Chinese companies that aid Russia could be shut down, commerce secretary warns.

Commerce Secretary Gina Raymondo on Tuesday sternly warned Chinese companies that they could circumvent US sanctions on exports to Russia, saying the United States would cut them off from American equipment and software needed to make their products.

The Biden administration could “essentially shut down” Semiconductor Manufacturing International Corporation or any Chinese company that continues to supply chips and other advanced technology to Russia in defiance of U.S. sanctions, Ms. Raymondo said in an interview with The New York Times.

The United States, the European Union and other governments have issued extensive sanctions and export restrictions in response to the Russian invasion of Ukraine. Export restrictions prohibit the sale of certain high-tech products, including advanced semiconductors, to Russia and Belarus.

US export restrictions apply not only to American companies, but to companies anywhere in the world that use American software or technology to manufacture their products, including many Chinese companies.

China and Russia have strengthened their trade ties in recent years, and the Chinese government has expressed little solidarity with the Russian government despite the aggression. But China does not have the capacity to build the world’s most advanced semiconductor, Ms. Raymondo said, and Chinese companies that continue to supply Russia will face severe penalties.

Russia will “urgently urge other countries to put an end to our sanctions and export restrictions,” she said. Raymondo said. But if the United States finds out that a company like Semiconductor Manufacturing International Corporation in Shanghai is selling its chips to Russia, “we must shut down SMIC because we prevent them from using our equipment and our software.”, She said.

“It is in their own interest not to give this stuff to Russia. So they are not doing it out of their own good. It would be disastrous for China’s ability to produce these chips.”, Ms. Raymondo added.

The new export controls, which were issued in coordination with the European Union, Australia, Japan, South Korea and other allies, are designed to prevent the flow of advanced technologies into Russia to degrade the Russian military and certain strategic areas that President Vladimir V. Putin maintains control over Russia.

The United States took similar action against Chinese telecom firm Huawei in 2020, cutting off global supplies of chips and other electronics made with US technology. The move crippled Huawei’s successful mobile and broadband businesses.

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