Blog: Businesses feel force of Egypt troubles
Michelle Russell | 31 January 2011
As widespread political protests continue against Egypt's president, Hosni Mubarak, local businesses are beginning to feel the impact.
Several major companies have curtailed operations in the country. Meanwhile, on a macro level, analysts warned that Egypt's economic growth has already been damaged by the protests, which entered their seventh day today (31 January).
Moody's cut its rating on Egypt by one notch, warning that Egypt's public finances could suffer if authorities respond to the crisis by raising wages or increasing subsidies on food and fuel, the Guardian wrote today.
just-drinks reported this morning that Heineken has suspended beer and soft drinks operations in Egypt with the temporary closure of six facilities, including two breweries, two soft drinks plants, a maltings and a winery.
The brewer last night flew ex-patriot employees out of the country amid escalating tension between protesters and security forces. Soft drinks giant PepsiCo also confirmed today that it is flying its own ex-pat employees out of the country.
“PepsiCo’s first priority is the safety of our employees and their families,” the firm said in a statement. “We are continually evaluating our operations and making adjustments based on local conditions with employee safety in mind. Employees who are not residents of Egypt but who happen to be there at this time are being assisted by the company to return to their home countries as soon as feasible."
Other known companies to be affected by the protests include chemicals company Akzo Nobel, consumer products giant Unilever, Japanese auto company Nissan Motor and US-based General Motors. AP Moller-Maersk, meanwhile, has suspended its port terminal operations.
According to the BBC today, there is US$25bn of foreign investment in Egypt, around half of which is made up of shares in companies based in the country. If protests continue, economics could play a significant role in forcing a settlement.
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- The End of the Road for International Beer Brands?
- Comment - Another One Bites Bacardi's Dust
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- Pernod Ricard's FY Performance by Region, Brand
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- Mast-Jägermeister targets UK off-trade boost
- Pernod bemoans tough FY as sales, profits drop
- ASA bans Jägermeister TV ad
- Bacardi announces CFO switch
- SABMiller exec to become CFO at Beam Suntory