U.S. prepares for Huawei-style sanctions… AI/Smartphone Exports Are Closed

WP Report… Prohibition of export of products using technology in the U.S. to apply the rules for overseas direct production

In the event of Russia’s invasion of Ukraine, the U.S. government is said to be considering sanctions similar to those applied to Chinese company Huawei to stifle Russia’s key industries.

The Washington Post (WP) cited multiple officials on the 24th (local time), citing that the Joe Biden administration is using artificial intelligence and quantum computing to damage a strategic industry that Vladimir Putin is working on if the Ukraine conflict becomes a reality. It was reported that a plan to regulate the export of related products is being prepared.

According to the article, if sanctions are extended, exports of smartphones, tablets and video game consoles could also be banned.

To this end, officials said the US government is considering applying the same ‘Foreign Direct Product Rule’ that was fatal to Chinese company Huawei.

The WP pointed out that if applied, a huge setback is inevitable as the rule on direct overseas production can not only prohibit the export of domestic products produced using US software or technology, but also pressure the export of products produced using it in third countries.

In particular, it is impossible not to use American software or technology in the production of semiconductors, a key component of all electronic devices, so the ripple effect is bound to be enormous.

In fact, as sanctions under the rules for overseas direct production intensified, Huawei’s sales last year plummeted by 30%.

The U.S. government is said to be discussing a regulation to block the export of key parts in the civil aviation, shipping, and high-tech sectors that Russia is focusing on, along with its European and Asian allies.

However, such export sanctions may act as a formidable headwind for the European and US economies in that they will suspend trade with Russia, and may have the effect of encouraging some third-country companies to develop production methods other than US technology. The WP pointed out that

The fact that similar types of sanctions were not imposed on the entire industrial sector or country beyond the corporate level such as Huawei is also a big factor in this aspect.

Analysts, however, have come up with an analysis that the impact on the Russian economy will be enormous if President Biden’s already publicly mentioned financial sanctions and export controls are combined.

“If the goal is to inflict severe and overwhelming costs on the Russian economy, the combined effect of financial and export sanctions is staggering,” said Kevin Wolf, who was in charge of export controls at the Department of Commerce.

The Biden administration is also considering a measure to ban the export of electronic products, airplane parts, communication devices and software to Russia, similar to what it had in Iran, Cuba, Syria, and North Korea, but it was not effective because there were not many direct exports from US companies. pointed out to be limited.

Meanwhile, the Biden administration ordered the evacuation of the families of embassy employees in Ukraine the day before and raised the travel alert for Russia to the highest level, level 4 (no travel).

This is a procedure normally followed by the US government in areas where there is a high risk of invasion, foreign media pointed out.

The U.S. government is also weighing on deploying thousands of U.S. troops to the Baltic States and Poland, but is not considering sending troops to Ukraine.

/yunhap news