Signs China is wary of the trade ban

Beijing’s warning sign against Western trade ban

US Commerce Secretary Gina Raimondo on May 17 called this a warning sign by Beijing about violating trade bans. China’s laptop shipments to Russia fell 40% in March compared with February 2022, while smartphone exports fell by two-thirds, she cited available China trade data. most recent. Gina Raimondo also added that exports of telecommunications network equipment also decreased by 98%.

Whether China is willing to help Russia fend off sanctions remains an open question for Western policymakers. The export figures, previously reported by The Wall Street Journal, suggest that Beijing was initially at least reluctant to break the rules, perhaps out of fear of US retaliation, which could involve the restrict the sale of technology to Chinese companies. Most chip factories around the world, including those in China, use software or equipment designed in the United States, analysts say.

“I’m often asked, you know, do these export controls work? And I think the answer is an unfounded, unqualified yes,” Raimondo said. “I think they’re doing it because we have a strong coalition of countries around the world engaged in serious, clear enforcement.”

The United States and 37 other countries instituted trade restrictions to cripple Russia’s high-tech and military economy after it invaded. Ukraine. The regulations prohibit the sale of computer chips, telecommunications equipment, lasers, avionics and marine technology to many Russian buyers.

Many European companies have voluntarily stopped exporting to Russia, although some items are not affected by the ban

There are signs that the restrictions are also undermining Russia’s ability to produce at least some military equipment. The export bans are not intended to completely prevent the sale of consumer goods such as smartphones and laptops to Russia. However, commercial lawyers say, some companies have stopped shipping electronic products to Russia, even though those particular individual items are not in violation of the ban.

“Many companies have taken the initiative to stop exporting to Russia on their own,” said Kevin Wolf, a former senior US Department of Commerce official who is now a partner at Akin Gump Strauss Hauer & Feld.

This shows that the treatment of Western technology companies is different from that of the previous US regulation that banned the export of technology to Huawei, a Chinese telecommunications manufacturer, and other Chinese companies. Another country that the United States accuses of threatening national security. In that case, the computer chip makers and other Chinese companies have asked their lawyers to study the rules to determine what items are still allowed.

“Foreign aggression and trauma have more impact on policy-based decisions of European companies than what they do,” says Wolf. [trong trường hợp của Huawei] described as a broad national security threat.” Typically, a range of major tech companies — in the United States, South Korea and even China — have said they will either stop sales or suspended business in Russia when the war broke out.

Even China’s DJI, the world’s largest maker of commercial drones, said in April it was suspending operations in Ukraine and Russia, becoming the first major Chinese company to publicly announce it. announced to leave the market after a war that the Chinese government refused to condemn.

Apple in March said it was suspending all product sales in Russia. A few days later, Samsung also suspended all product sales, including smartphones and computer chips. This is worth mentioning because China’s Apple, Samsung and Xiaomi were the top three smartphone companies in Russia in the first quarter by shipments, according to the latest figures from International Data Corp (IDC). Meanwhile, Xiaomi did not immediately respond to a request for comment on its sales to Russian buyers.

Huawei, one of the world’s largest manufacturers of telecommunications networking equipment, declined to say whether it would reduce sales to Russia, despite the near-total decline in equipment sales such as So in March suggests that could have happened.

Huaweil spokesman Glenn Schloss said in an email: “Our hearts go out to those who are suffering as a result of this conflict. We are assessing the impact of relevant policies. of Huawei is to comply with the applicable laws and regulations of the countries and regions in which we operate.”

And Nabila Popal, director of global device market research at IDC, said some tech companies don’t sell directly in Russia anymore. Exports to Russia from various countries have plummeted. U.S. shipments in export-controlled technology categories fell 86%. According to Nabila Popal, South Korea’s exports to Russia fell by 62% and Finland by 60%.