The US now expects Chinese tech companies to comply with its newly announced trade sanctions against Russia, which aim to cut off its military’s access to sensitive technologies including semiconductors.
But why should China, which has been an isolated voice of opposition to increasingly harsh sanctions, comply? The answer, for the country’s high-tech businesses at least, is fear of losing access to US tech themselves.
The go-to software for chip design comes from the US Machinery, equipment, many of the backbone essentials that feed into a comprehensive silicon supply chain are provided by American suppliers. The global chipmaking apparatus would crumble overnight without US participation.
Witness the example of Huawei Technologies, once China’s equivalent of Apple, which designed its own mobile chips and beat the iPhone maker to significant firsts in mobile photography. The company’s smartphone business was effectively starved out of existence when the US deemed it a national security risk and imposed sanctions that were the mirror image of what Russia is subject to now.
Tech advancements without chips are impossible and so is getting the chips you need without US assent. It puts Chinese tech companies in a very awkward position: having to appease US demands to preserve access to essential tech at the same time as their government publicly snarls at the very idea of imposing trade restrictions.
“China doesn’t approve of resorting to sanctions to try to resolve problems,“ Foreign Ministry spokesman Wang Wenbin said at a regular press briefing in Beijing. He added that nations “should not harm the legitimate rights and interests of the Chinese side.”
So long as everyone plays ball, both US demands and the legitimate interests of Chinese companies can be satisfied. China’s exports to Russia are insignificant to its economy whereas they’re the bulk of Russian electronics imports. So we can expect the sanctions to prove effective.