Potential Sanction Scan: Are your customers present in Russia or Belarus?

Russia sanctions directly apply to more than 16,500 companies worldwide

Reading Time 8 minutes | Written by Anne de Geus | March 8, 2022

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What is the impact of the economic measures on Belgian trade?

Brussels - The sanctions declared by the Office of Foreign Assets Control against Russia initially affect some 16,500 companies worldwide, spread across 21 countries. That's according to business data specialist Altares Dun & Bradstreet after analyzing the corporate structures of Russia's largest companies and holding companies. These companies are all operating under the flags of the seven largest Russian financial institutions and the 13 Russian companies, who are initially targeted by the sanctions.

According to David Verheecke, Managing Director Benelux at Altares Dun & Bradstreet, the volume shows the huge impact of the various sanctions on other international companies: "First of all, of course, what is happening in Ukraine is terrible and our first thoughts go out to all those involved there. However, the consequences also affect the entire world trade; more than 7.5 million direct and indirect supplier relationships with these companies are visible worldwide. Thus, we see that as many as 374,000 companies worldwide depend on Russian suppliers in the first or second line of logistics. For Ukraine, these are some 241,000 companies.”

How dependent is Belgium

When Altares Dun & Bradstreet zooms in on the figures, it sees the impact on Belgian trade: 2156 companies trade directly or through-via with Russia and Ukraine. 61 Belgian companies even have crucial suppliers in Russia, meaning that business operations depend on supplies from those companies.

Altares Dun & Bradstreet figures say that 25 countries worldwide depend "to a large extent" on wheat and meslin from Russia and Ukraine. Many nations also depend on the two superpowers for coal (24 countries) and gas (16 countries). In addition, there are other general impacts that organizations will experience in their business operations, customer relationships and supply chain because of the economic sanctions:

Expensive (raw) materials

If the conflict continues for a long time or escalates, raw materials such as gas, oil and metal in particular will become much more expensive. Europe will then have to get these from elsewhere. This brings with it additional costs, which companies have to pass on to their end customers. So prices are rising all along the supply chain, adding to inflation. Belgium, by the way, buys about 20 percent of its oil and gas from Russia. For the Netherlands, it is about 25 percent.

More need for research

Bedrijven moeten bekijken wie hun klanten en leveranciers zijn en of toekomstige betalingen in de toekomst stroever zullen verlopen. Bij verdere escalatie van het conflict is het denkbaar dat handel met Rusland compleet onmogelijk is: organisaties moeten dan een plan B hebben om (snel) aan hun grondstoffen te kunnen komen. Incidentally, this applies not only to direct suppliers, so companies would be well advised to know whether their suppliers directly or indirectly dependent on Russia or Ukraine.

Slowing economic recovery

Worldwide organizations are doing their best to recover after more than two years of corona. The conflict in Ukraine is slowing this recovery. Delayed or changed trade routes and inflation can put organizations in trouble and shrink the GDP of many countries. Again, this makes exploring alternatives more important for organizations: they need to look at how they can be more flexible now and in the future, in order to minimize the impact of a possible future crisis like this.

David Verheecke: “It is crucial that organizations understand the family trees of their customers and suppliers. Doing business with organizations involved in this conflict is a sensitive issue but also a practical dilemma. As a company you therefore cannot escape doing research into where your products and raw materials come from and where your money goes. Only in this way can you find alternatives that will help your organization recover after this crisis..”

About Altares Dun & Bradstreet

Altares Dun & Bradstreet is the Benelux market leader in the collection, processing and delivery of business enterprise data. As a business data specialist and partner of the global Dun & Bradstreet (NYSE:DNB) network, they offer their clients access to data from more than 400 million companies in 220 countries. Altares Dun & Bradstreet's data cloud solutions deliver insights that enable clients to mitigate risk, increase revenue, reduce costs, and thus improve business performance.

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Anne de Geus

Marketing Campaign Officer

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