US Annoyed with China: Sanctions Two Companies for Shipping 17,000 Chips to Russia – A Compelling Conflict

When Russia’s invasion of China began, Putin’s nation was swiftly banned and sanctioned by most countries and companies. This led to hardware companies like Intel and AMD ceasing to sell their processors and graphics there. Even though Russia is still sanctioned and China is restricted by the United States, chips continue to be sent to Russia through Hong Kong.

Since the start of the war, Russia has had difficulty accessing electronic products but has managed to persevere. We have seen them use domestically produced chips to make up for the lack of semiconductors, such as the Baikal CPUs, which utilize outdated manufacturing processes and lack the power of well-known brands.

Despite sanctions, Russia manages to obtain Chinese chips through Hong Kong

Russia has also been purchasing CPUs from China, such as Loongson, due to the Asian giant allowing their export again. Putin’s nation continues to find alternatives and overcome imposed sanctions. Now it’s revealed that Russia is obtaining chips despite both Russia and China being sanctioned by the United States. These chips have been sent via Hong Kong.

These chips come from major companies like Texas Instruments and Analog Devices and are used for military and other purposes. Russia is thus taking advantage of this exchange during the war. This information comes from non-profit research organization C4ADS.

Chip shipments to Russia increased by 32% this year

Both Texas Instruments and Analog Devices stated that they had not sold the chips directly to Hong Kong and had stopped doing business with Russia since 2022 because of the war. Despite these claims, Russia continues to receive Chinese chips through Hong Kong. Over 200 Russian companies received 17,000 Texas Instruments chips between January and May 2023, worth 25 million dollars. These shipments were made through two Hong Kong companies, which were sanctioned in October.

The chips were primarily shipped to NPP Itelma, a manufacturer of electronic devices for vehicles, which received 3 million dollars’ worth of chips. This company was sanctioned by the United States last September. The second-largest recipient is VMK, which received chips worth 2.3 million dollars and was also sanctioned in September. Texas Instruments argues that it opposes the use of its chips for the Russian military and their shipment to the country.

For companies of this caliber, the sale and shipment of chips to Russia do not yield significant profits considering their annual sales of 18,000 million dollars. The combination of Hong Kong companies and Russian bank accounts is believed to have enabled the illicit shipment to the country. Adding up all chip shipments, including from the United States and Europe, the value is much higher. Over 500 Russian companies have received chips worth a total of 528 million dollars, a 32% increase compared to 400 million in 2022. Companies like Intel barely contributed, as there was only one shipment from them, worth less than 330 dollars.

The United States is unhappy with China and sanctions two of its companies for sending 17,000 chips to Russia, as first reported by El Chapuzas Informático.