The Cascading Effects of Chip Starvation to Russia

The US and its allies like Japan, South Korea, Taiwan and the Netherlands enjoy an elevated status in the global high-tech sphere. Much of the world’s production capacity and intellectual property (IP) related to micro-electronic and semiconductors chips are concentrated in the territory of the US and its allies. This strategic high-tech dominance ensures that the US can inflict major costs on adversarial countries like Russia and China and their economies. It is clear that the recently imposed sanctions and export controls on Russia and the resultant chip starvation will have increasingly detrimental effects on the Russian economy. With no hope to import chips legally, Moscow may turn to gray imports and smuggling.