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Absolut vodka's exports to Russia suspended

Absolut vodka's exports to Russia suspended
A logo is seen on a bottle of the Ricard aniseed-flavoured beverage displayed during French drinks maker Pernod Ricard news conference to announce the company annual results in Paris, France, on Aug 29, 2018.
PHOTO: Reuters

LONDON/PARIS - French spirits group Pernod Ricard said it is suspending exports entirely of its premium vodka Absolut to Russia, having previously reduced sales following Moscow's invasion of Ukraine.

Last week, several media outlets reported that Absolut was "supplying products in an amount that can support local employees and give local entities economic sustainability," citing a Pernod spokesperson.

The reports sparked criticism in Sweden, where the vodka is made.

Pernod said in a statement emailed to Reuters that as a result it has taken the decision to suspend Absolut supplies entirely due to a "duty of care towards our employees and partners."

"We cannot expose them to massive criticism in all forms. Therefore, The Absolut Company has decided to stop the export of its brand to Russia," it said.

Like many Western consumer goods companies, Pernod Ricard cut back heavily on products it sells in Russia last year, having previously derived around 3 per cent of its sales there.

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By limiting supply, Pernod had been able to shield its local team from accusations of criminal liability, it said, citing "intentional bankruptcy".

Some Western firms departing Russia have been wary of allowing production to stop, or letting factories go idle, due to concern they would be seen as deliberately running their businesses into bankruptcy.

However, Western brands' efforts to extricate themselves from the Russian market have been complicated by Moscow's attempts to protect consumers from isolation by the West.

On Friday, Russia published a list of goods from foreign carmakers, technology companies and consumer brands that the government has included in a so-called "parallel imports" scheme.

"For clarity, this will unfortunately not prevent Absolut from falling into the hands of the 'parallel market', which has strongly increased in recent months and over which we have no control," Pernod said.

Pernod is still supplying a limited supply of other brands in Russia and declined to comment on why it had not stopped doing so.

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