What are the warnings to China of the US sanctions on Mikron, Russia's largest chip maker?
US sanctions Mikron
The conflict between Russia and Ukraine has been going on for more than a month, and the two countries are fighting fiercely on the Ukrainian mainland. But on the other side, a war without gunpowder is going on, that is, the competition in the field of technology. On March 31, the United States imposed new sanctions on Russia, including the Joint Stock Company Mikron, Russia's largest chip maker, microelectronics maker and exporter.

U.S. Treasury Department official website

U.S. Treasury Secretary Janet Yellen said the U.S. will continue to impose sanctions on Russia from all angles until the conflict between Russia and Ukraine is over. This round of sanctions, which includes 21 entities and 13 individuals, not only freezes all U.S. assets of these targets, but also prohibits Americans from dealing with them.

A technological offensive and defensive battle without gunpowder smoke

With the development of science and technology, the form of warfare has also begun to undergo a huge change, from military warfare in the past to today's all-round warfare, including financial, political, military, technology, network and other aspects, compared to direct military conflicts , finance, technology, Internet, etc. seem to be more "civilized", but also more "cruel".

The U.S. Treasury Department sanctioned Russian cyber and technology-related entities and individuals this time, and the reason given was to “prevent Russia from evading sanctions and procuring key Western technologies.”

Source: U.S. Treasury Department

Among the entities included AO NII-Vektor, a software and communications technology company based in St. Petersburg, Russia, which the U.S. noted provides technical analysis and reports for the production phase of Russia's Liana constellation satellites. The Liana constellation satellites may be used to track ships, aircraft and ground vehicles, so the United States believes that AO NII-Vektor should be sanctioned.

There is also T-Platforms, a Moscow-based company operating in the field of computer hardware, a developer of original computing equipment for the Russian supercomputer industry and the country's leading mass information technology market. Others such as the Russian Molecular Electronics Research Institute (MERI), a research institute that manufactures computers, search and navigation equipment, and conducts research and development.
Notably, Mikron is also included in the sanctions list by the United States. Mikron is Russia's largest microelectronics manufacturer and exporter, responsible for exporting more than 50% of Russian microelectronics, the company also produces integrated circuits, electronic components, and is Russia's largest chip maker.

Mikron obtained the technology transfer from ST in 2006 and has the technical ability to produce 0.18μm chips. By 2013, it has been able to realize the R&D and mass production of the 65nm manufacturing process. Mikron is also the only local company in Russia capable of mass production of the 65nm process. enterprise.

At the same time, the United States not only sanctioned these Russian technology companies, but also stated that if there are any entities in which one or more of the sanctioned persons directly or indirectly, individually or cumulatively own more than 50%, they will also be sanctioned, unless they obtain a foreign asset management office. Authorization of general or specific licenses issued, or exemptions.

This round also imposes direct sanctions on related entities in Russia. Previously, the United States has joined its allies to ban Intel, TSMC, Hewlett-Packard, Ericsson and other US and non-US chip and hardware manufacturers, as well as basic software such as Oracle, SAP, and GitHub. The company ceases business activities in Russia.

Russia certainly won’t sit still, as from March 31, the Russian government banned all state agencies and semi-government entities from purchasing foreign software for critical infrastructure projects without authorization. And from January 1, 2025, any government agency or user will be completely banned from using foreign software in critical information infrastructure projects.

It is foreseeable that when the technological offensive and defensive battle between the two sides is not over yet, Kate Bedingfield, director of the White House Communications Office, said recently that the U.S. Department of Commerce will add 120 Russian and Belarusian entities to its sanctions in the next few days. The list is aimed at countering the strength of Russia's defense, aerospace and maritime sectors.

Impact on Russia

The Internet and technology sanctions against Russia obviously have a huge impact on its domestic consumer market. For example, mobile phones, smart home devices, and social networks have all been impacted by sanctions. From a broader perspective, the overall impact on Russia is not as big as imagined.

Although a number of global chip giants including Intel, AMD, Nvidia, Samsung, GF, TSMC, Qualcomm, and ARM have participated in the sanctions against Russia, in fact, Russia has very little demand for foreign chips.

ImportGenius data shows that the amount of chips imported by Russia in 2021 is expected to be 100 million US dollars, accounting for only 0.02% of global semiconductors. Data released by the Semiconductor Industry Association (SIA) in 2021 shows that Russian semiconductor purchases account for less than 0.1% of global semiconductor purchases.
And among these chips imported from Russia, 40% come from Germany, but German chip manufacturers have not yet participated in the sanctions against Russia, such as Infineon.

Even if Russia is completely unable to import chips from abroad, it does not matter. As mentioned above, Russia's Mikron already has the mass production capacity of the 65nm process, which can fully meet the daily chip needs, not to mention military chips.

And before the electronics enthusiasts in "Why "high-tech is not strong" Russia, can destroy the Ukrainian Navy and Air Force in one hour? ” mentioned in the article that Russia has given full play to its technical advantages in electronic tubes, using radio frequency circuits and analog circuits to replace some key chips.

For example, when implementing IF coherent accumulation, different from other ideas that use FPGA devices, Russia uses other excited crystal oscillators instead of FPGAs to achieve this function, which also gives Russia a stronger ability to deal with semiconductor blockades. .

Not only hardware, but also software, Russia has established a certain capability of independent substitution. For example, in the fields of database and other technologies, the open-source columnar database ClickHouse of Russian Yandex Company is very popular all over the world. It is reported that the speed of this database processing data is 100-1000 times faster than that of traditional databases.

It needs to be admitted that the blockade of these companies will inevitably drag down Russia's technological development and affect Russia's economy to a certain extent, but it will also make Russia more determined to move towards the path of domestic substitution, because they have no choice this time. .

Warning to China

Now that the sanctions against Russia are getting more and more severe, as China, which has also been sanctioned by the so-called list of the United States, what kind of warnings can it get?

First of all, it needs to be clear that international semiconductor giants such as Intel, AMD, NVIDIA, Samsung, GF, etc. dare to impose sanctions on Russia, on the one hand, because the United States is tough, forcing them to give up their customers; on the other hand, because The Russian market is not large. In addition to the small import volume of chips, Russia's purchase of major electronic products such as computers and smartphones is very small, accounting for 2% of global shipments, and servers only 1%.

But China is different. China imports more than 300 billion US dollars of semiconductor chips from the world every year, and many of the imported and exported electronic products and equipment account for more than half of the world's share. For many major semiconductor manufacturers, the importance of the Chinese market is self-evident. Sanctions will only hurt one thousand enemies and eight hundred.

Of course, the Western sanctions against Russian high-tech companies are also a major warning to China. Only their own companies can be trusted, and only self-controllable technologies can truly help themselves.

However, it should be noted that domestic technological innovation should be an iteration of technological innovation brought about by demand, rather than repeating the creation of wheels for domestic substitution.

For example, Huawei's HarmonyOS was not born to replace Android from the very beginning, but mainly to challenge the underlying technical solutions under the Internet of Everything. Therefore, even without considering the factors of domestic substitution, many home appliance brands choose operating systems. HarmonyOS also has more advantages.

The same is true for chips. Guided by market demand, based on the actual situation, the products can be made to their own advantages. Under the factor of abandoning domestic substitution, the market can also choose to use their own products, which can be considered as a real domestic substitution.

And if domestic technology enterprises want to develop, they should also abandon the thinking of low-price competition, occupy the market through technical strength, rather than simply rely on price to compete, encourage research and development, support innovation, and treat talents well, is the long-term development of enterprises. .