The 46th US President, Joe Biden, in a live address has announced action to hold Russia accountable for the ongoing invasion of Ukraine. During his speech, Biden declared that the US was “blocking Russia’s access to technology such as semiconductors to undermine its economic strength and weaken its military for years to come.”
The US is banning the sale of any chips developed from American technology to Russia. While the US has only a small base of semiconductor manufacturing, its companies are leaders in semiconductor design and chip patents, which many foreign manufacturers rely on to design their own chips.
To recall, the US had previously used similar sanctions to block Chinese tech major Huawei Technologies, the largest smartphone and telecommunications equipment supplier at the time, majorly disrupting its business. .
The US Semiconductor Industry Association (SIA) CEO, John Nefer, said in an earlier statement that the ban on selling semiconductors to Russia would not greatly affect global suppliers, as “Russia is not a significant direct consumer of semiconductors.” He further added that the country accounts for only 0.1 per cent of global chip purchases.
Keep in mind, however, that Russia and Ukraine are major suppliers of neon gas and palladium, both of which are key ingredients used during the chip manufacturing process. Back in 2014 when Russia first invaded Ukraine, chipmakers began to diversify into neon sourcing as the price of neon went up by 600 percent due to the war. As of now, a lot of chip makers are ready to switch suppliers, which will reduce the impact on neon supplies.
In the short term, these sanctions may not affect Russia, as it draws about 70 percent of its chip supplies from its ally China, which is likely to ignore what the US is saying. However, the Chinese chip manufacturing market is currently not as well equipped and can only produce relatively low-end chipsets.
Breaking post: US imposes sanctions on semiconductor supplies to Russia First appeared on BGR India.
