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.