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Putin, Vladimir

US Export Controls Target Russia's Access to Global Chip Supplies

Strategic Insights

— 2 min read

The US has announced far-reaching export controls to isolate Russia from the world's technology economy, targeting its military capabilities and economic interests. The measures, part of a wave of US and western sanctions in retaliation for Russia's invasion of Ukraine, aim to cut Russia off from high-end semiconductors and other critical technology imports. The move is a significant escalation of the US's use of its technological superiority to counter Russia's global ambitions.

Key Takeaways:

  • The US export controls target Russia's access to global chip supplies, aiming to isolate the country from the world's technology economy.
  • The measures are designed to have an impact on government and industrial groups, rather than ordinary consumers, said Kevin Wolf, a former senior commerce department official.
  • The US has honed its ability to cut companies off from semiconductors by using its export control powers on the Chinese telecoms company Huawei during the administration of Donald Trump.
  • Taiwan Semiconductor Manufacturing Company, the world's largest contract chipmaker, has pledged full compliance with the new export controls.
  • The US restrictions would also affect the Russian technology sector more broadly, pushing Russia further back in emerging tech, according to Jim Lewis of the Center for Strategic and International Studies.
  • Huawei could monopolize the Russian telecom equipment market, with Artyom Lukin, an associate professor at Far Eastern Federal University, predicting that Chinese companies might help Russia circumvent the export controls.
  • China's largest chipmaker, SMIC, is itself under US sanctions and has lost access to equipment needed to build production lines at the most advanced process technology level.
  • A senior White House official rejected the idea that China would help Russia to circumvent US sanctions, stating that China alone cannot supply all of Russia's critical needs for the military.
  • Martin Chorzempa of the Washington-based Peterson Institute think-tank said it is unimaginable that Russia would be capable of producing advanced chips.

Statistics:

  • The new export controls target a list of 49 military entities, effectively denying Russia access to high-end semiconductors and other technology imports critical to its military advancement.
  • China accounts for only 16 percent of global capacity in chip production.
  • Russia boasts one of the world's best supercomputers, which relies on hardware made by US-based Advanced Micro Devices and Nvidia.

Sources:

  • "US aims to isolate Russia from global tech economy." (The Financial Times, 11 Jun 2022)
  • "Huawei, a trial run." (Christopher Timura, a trade lawyer at Washington's Gibson Dunn)
  • "China's largest chipmaker under US sanctions." (The Wall Street Journal, 27 Mar 2021)
  • "US restrictions on technology exports to Russia." (A senior White House official)
  • "China's thriving technology ecosystem." (Martin Chorzempa of the Washington-based Peterson Institute think-tank)

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