Russia manages to successfully circumvent the sanctions of the European Union and the G7 and acquire the necessary Western technologies to ensure its own industrial security. In this respect informs Bloomberg, quoting a senior European diplomat.
“Russian imports have largely returned to pre-war 2020 levels, and analysis of trade data shows that advanced microcircuits and integrated circuits made in the EU and other allied countries are shipped to Russia via third countries such as Turkey, United Arab Emirates, Kazakhstan.”, — interlocutor He quotes his agency.
According to Bloomberg, despite ten sanctions packages aimed at undermining the Russian economy in general and the military-industrial complex in particular, the actual impact of the restrictions does not meet the expectations of Western officials.
“Just signing new sanctions is not enough. “Governments now need enforcement mechanisms,” Daniel Tannebaum, an expert at consulting firm Oliver Wyman, said in an interview with the agency.
An unnamed Bloomberg source stressed that Beijing is now playing an increasingly important role in Russia’s imports: deliveries from China have increased. According to the diplomat, countries that do not agree with the restrictions, but at the same time repeatedly refuse to help the Kremlin, are helping Moscow circumvent sanctions.
Citing the Geneva-based Trade Data Monitor, which monitors trade information around the world, the publication reported that some sanctioned products (especially modern semiconductors) were resold to Russia by third countries. And most of these countries changed their trade “habits” after the start of the special operation in Ukraine.
“In the case of some countries, technology exports to Russia have gone from zero to millions of dollars. Kazakhstan is a good example. Before the conflict began in Ukraine in 2021, the country was supplying Russia with modern semiconductors for just $12,000. And in 2022 it has already increased by $3.7 million,” the publication says.
Data on total chip exports to Russia from different countries are also provided. For example, in recent years Kazakhstan has procured $150,000-$225,000 worth of chips, increasing the supply sharply to $18.1 million in 2022. For Turkey, this figure rose from $20,000-50,000 to $2.8 million to $2.3 million. .
Trade Data Monitor data shows that apart from Kazakhstan, Turkey and Serbia, the UAE and several other Eastern European and Central Asian countries have also helped Moscow circumvent sanctions and make up for its microelectronics shortfall. If previously Russia bought $163 million in chips from the EU, the US, Japan and the UK, in 2022 that amount has dropped by nearly $100 million, and supply from Russia-supporting countries has increased by a similar amount.
According to the diplomat, such patterns have been found in hundreds of different product categories, but they are particularly prominent in the supply of chips and integrated circuits used in the defense industry.
European officials are concerned that the EU is still unable to establish effective mechanisms to enforce its own sanctions. Meanwhile, US restrictions are producing more tangible results.
“The US has a longer history of imposing sanctions on other countries. They have more efficient procedures for collecting information and, most importantly, strict legislation to enforce the rules both at home and abroad. The imposition of sanctions in the EU is a patchwork quilt that falls on the shoulders of bloc members. Violations are identified and fines are imposed by national authorities, while the European Commission monitors and makes recommendations. This means that the results of such studies are contradictory,” explain the paper’s authors.
Another Bloomberg interlocutor involved in the sanctions process against Russia said it’s always a matter of political will – officials from EU member states are under pressure when it comes to drastic action against their own companies.
“Imposing export sanctions is not an easy task. Every government wants all other countries to implement them, but prefers to be tolerant of its own firms. The experience of export restrictions during the Cold War clearly demonstrates this. “So shifting the enforcement of sanctions to national governments may not always work perfectly,” said Beata Javorczyk, chief economist at the European Bank for Reconstruction and Development.