China Helps Russia Evade Sanctions (January 2023)

This WSJ article is one illustration of, and an interesting perspective on, how hard it is to isolate a country through sanctions, even when multilateral. Major economies not aligned with those imposing sanctions can be a fly in the ointment when it comes to the sanctions’ effectiveness.

“Russia last year increased its imports of semiconductors and microchips by around 34%, with China emerging as the major source. That has helped Russia increase its overall import of chips to $2.45 billion in 2022 from $1.82 billion in 2021, despite Western sanctions targeting that trade.  Russia and China have spent years forging stronger economic ties, including a $55 billion gas pipeline and Russia’s increased usage of China’s yuan.”

“As some of Russia’s traditional suppliers of high-tech goods, such as Germany, the Netherlands and South Korea scaled back their shipments, imports from China more than doubled. In the March to September period, the value of Chinese semiconductor exports to Russia jumped from $200 million in 2021 to over $500 million last year.”

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