The Biden administration is threatening to cut off Russia’s semiconductor supply as part of its planned sanctions against Moscow if it invades Ukraine, which the Russians insist won’t happen.
According to a report from Axios, the plan would not only cut off Russia from US-made chips but also from any chips made with US equipment, tools, software, or designs.
Such an export control imposed by the federal government could have a major impact on the US chip industry since it could drive foreign chip-makers to seek alternatives from non-US companies.
“One of the concerns from industry has been this is really opening up Pandora’s box, in a manner of speaking, of the use of extraterritorial controls as a policy means,” an industry source told Axios. “That potentially signifies quite a broadening out of US export control reach, and the willingness of the administration to view this as a policy option.”
If the US did impose the chip ban on Russia, Moscow could look to Beijing for help, since it’s unlikely that China would follow the restriction. US sanctions and other pressure against Russia and China have naturally brought the two powers closer together.
The chip ban would be a part of the Biden administration’s plan to impose economic pain on Russia, which would hurt ordinary citizens. But the US narrative that Russia is planning an invasion is falling apart as even Ukraine is now downplaying the threat. Some hawks in Washington want President Biden to implement new sanctions now, but the president has said he would only impose them if Russia invades.
Another “sanction” that isn’t going to work and have nothing but blow back on the EU and US economies. “Shooting yourself in the foot” takes on new meaning.
I’m with Pres. Biden on this: only imposing sanctions if Russia actually invades… Give the hawks some granola bars and let them chew on that…
If Russia actually invades it will be because the US instigated them into doing so. Biden/US shouldn’t be sanctioning anybody, should admit to instigating the coup, drop out of NATO and we can all live happily ever after.
I agree, it’s just that I think Russia is smarter than that… I like the happily ever after part…
They’re insipid.
It is opening Pandora box. Purchasing around the
Ok globe will never been the sane. Every purchasing decision will be made with an understanding that their exports could be destroyed should they buy US components — down to a lowly bolt — and US decides to sanction Country X.
In the example of chips market impacts short term are good from US perspective, Taiwan plant could no longer service its Chinese customers, even Chinese dedigned chips. Taiwan plant facing the loss of income was more ameniable to opening a plant in US. China and Russia have capacities to produce older versions, the workhorses of chip industry. Buying those in Western markets was always part and parcel of give and take comparative advantage trade balance,
Russia and China both shoped chips anong other things from the West , as they were cost effective, and they focused in newer technoligy. Now they need to ramp up production. Of course both have the means to ptoduce newer density chips, but were not in a hurry. Those are not meant for faster video games but for 5th industrial revilutiin. There are many components needed for this transition — and did not rush.
Just like Harminy operating system surprised Washingtom as it came in use shortly after Android banned. Bottom line, — there was still no need for a multifaceted Harmony until intenet of things get into mainstream industrial demand.
But — it was there when the ban came. Higher end chiios will be the same story. Both countries have the technology, it is a question of productiin ramp up.
This will probably be the topic between Putin and Xi.
It is also NOT true that this crisis is getting Chuna and Russia closer, Already in 1999 they signed an agreement on bringing about
“a new, and more just global worlld order”.
This agreement signed in 1999 after US bombing of Serbia become a founding document of Shanghai Cooperation Organizattion in 2000.
Clinton has laid bare US future policies, the key influencers have been put in place, and are just circulating in between various foundations and givernment posts.
We are having now the third Clinton dynasty administration. And they intend to focus on Russia, as it is their one true obseession. As another hight priest of Clunton ideoligy Thimas Friedman put it — it is Russia that ruined US-China relatiinship!
To translate from the Russophobic language — Russia’s deceitful DNA caused China to stop being our factory and cheap labor force. Russia gave China confidence,
Russia is dangerous as FOREVER will not accept Western dominance. Chinese eventually will.
The supremacism that reeks from
US official government policy has bern injected into mainstream by a fringe, tight knit circle with hundreds years old historic grudge. It is hard to believe it possible.
There is no earthly reason for US to be pokung at Russia for decades now.
They are itching to impement now!
Be careful what you wish for, it will come true, and bring unnintended rewards.
Look at how well all those sanctions and manuvers to ruin Turkey’s funances and crash lira is doing? I read a dozen of articles at least explaining how stupid Erdogan is, how he is hurting people. inflation, currency plunge — just waiting for the happy ending, people rebelling, a loathsome dictator ousted. What happened? Strange things happened when in the face of inflation, interest rates went down. Why? Because Turkey’s exports skyrocketing. Why? Turkey imlorts seni-finished products, parts from China and sells finished products to Europe, So Europe is importing even more from China then officially on books. For Turkey it means that average person with any kund of property has bern shielded from inflation as salaries are picking up, while the cost of indebtedness has gone down. There are similar arrangements with Russia. Because if low interest rate abd inflation real estate has remained attractive. But jt works only if the incomes rise and employment is steady.
Will the consumer be affected by the ban on chips? Our politicians actually think that all chips needed for your general consumer eletronucs are the highest end chips that only some equipment can make. However most chips in use today sre workhorses of the industry. And those manufacturers have bern already remiving any American parts or instruments they have built into their production lines. They may be eliminating everything down to US made screws. Russia snd China can produce chips for everyday use. The habit of shoping in US was just a convenience of buying from good suppliers thst can deliver fast. Domestic expansion made no sense. But that can change — and sadly for Americam producers — once their customers become self sufficient they do not come back.
Before you know it, there will be plants in Turkey, Kazahdtan or Uzbekistan making chips at lower labor costs.
It is a real Pandora’s box.