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20 Jan, 2022 10:53

US warns it may ban chip exports to Russia

The White House has warned US chipmakers it may curb exports to Russia if tensions between Moscow and Kiev escalate
US warns it may ban chip exports to Russia

In a phone call last Friday, White House National Security Council (NSC) officials Peter Harrell and Tarun Chhabra reportedly told representatives of the Semiconductor Industry Association (SIA) to get ready for immediate actions in the chip sector if Russia invades Ukraine.

Following the phone call, the SIA director wrote in an email to the board seen by Reuters that “the [US] administration is actively considering any and all options,” including potentially blocking Russia’s access to global electronic supplies.

The NSC relayed in blunt and stark terms the gravity of the situation they are currently grappling with in Ukraine, noting that this is an extraordinary situation and potentially the worst cross border invasion to take place since World War II,” the message reportedly read.

According to the email, the range of potential measures could include broad financial sanctions and export restrictions like those currently in place for Iran and North Korea, as well as for Chinese telecoms giant Huawei. The latter is tied directly with the chip industry. Under the so-called Foreign Direct Product Rule, the US can block Huawei from receiving shipments of chips, computers, and other electronic equipment made anywhere in the world if they were produced using US technology. The same fate may now await Russian tech firms.

White House spokeswoman Jen Psaki declined to confirm the phone call, but she said Washington has been “very clear that if Russia further invades Ukraine, the United States is looking at a range of options – with allies and partners – to deliver severe costs to the Russian economy.”

The SIA reportedly had a conference call with its members on Tuesday to discuss the conversation with the NSC. SIA government affairs official Jimmy Goodrich told Reuters that the proposed export control measures could land the industry “in uncharted waters.”

 “We are still trying to assess what the ripple effect may be to global supply chains,” Goodrich said.

Washington is mulling ways to deter Moscow’s supposed plans to invade neighboring Ukraine, after reports emerged that Russian troops were massed on its western border. Moscow has repeatedly denied having any plans whatsoever for a military offensive, with Kremlin Press Secretary Dmitry Peskov stating recently that the movement of a country’s armed forces on its own territory is an internal matter and of no concern to anyone else.

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