Cork giant counts losses in Russia

 In Bi-lateral trade, Companies, News

The Portuguese cork giant Amorim is faced with the challenge of protecting the jobs of 30 employees in the Russian market and securing payments for orders that were made pre-invasion.

Corticeira Amorim has business in Russia, Bielorussia and Ukraine, all of which are affected by either the war, sanctions or both.
With a total block on exports to these countries, Amorim CEO António Rios Amorim told the online news source ECO that the company’s present priority was the job security of around 30 staff in the three countries, as well as trying to recover the “relevant” amounts for orders which had not been paid for by the time the war started in 24 February.
“We are trying to claw back the cash which is very important. The sale is only completed when the money has entered our account and that has yet to happen. The transfer channel has been blocked. Most of the transfers are difficult to achieve because nothing that comes from those countries right now is seen as welcome,” he said.
Bank compliance departments are having difficulty in following through financial transactions. Amorim is trying to see if it can get the money in order to maintain its financial solvency (in these markets). The company has not stated the amount owed.
All told Russia, Bielorussia and Ukraine represent 1.5% of the company’s turnover which for the first time exceeded €800 million in 2021 to €837 million in these markets.
António Amorim admits “business has been at a complete standstill for three weeks”. The orders include wine bottle corks, coverings and composite materials.
In Russia the company employee 30 people and has two distribution centres. Although Amorim is prepared to lose the business from the orders, he said it was difficult to get an overview of the situation since “things are changing on a daily basis”.