China Deals Hammer Blow to Russia's War Effort

Beijing has reportedly banned the supply of military-grade processors to Russia produced by Chinese company Loongson, in a potential setback to Moscow's war effort in Ukraine.

Sanctions imposed since the start of Vladimir Putin's invasion have driven out many western companies from Russia and forced Moscow to look for new suppliers for crucial electronic components, including those for its weapons.

Russian manufacturers had been testing Chinese-made processors to replace those produced by companies like Intel, which had suspended deliveries, the Russian business newspaper Kommersant reported.

But a source from Russia's ministry of digital development told the outlet that the Chinese government had banned the sale and export of the processors due to their strategic importance for China's own military.

While Russian companies "were not very dependent on Chinese processors" they had "hoped to switch to Loongson solutions," the source told the newspaper.

Another source told the paper that the Chinese government had banned the export of Loongson processors to all countries, including Russia. "The best chipsets in China are used in the military-industrial complex, which is the main reason why they are not available for foreign markets," they said.

Marina Miron, a research fellow from the Defense Studies Department at King's College London (KCL) said any export ban by China will further affect Russia's ability to compete in the technological sector, forcing it to look for alternatives and increase its domestic capacity to produce microchips.

"That said, this move was not specifically designed to target Russia. Rather this ban concerns much broader targets," she told Newsweek, adding that it should not cause any significant breakdown of Russia's technological capacity.

"Although Russia did not integrate the Loongson processors into its ecosystem, it will still have to look for alternatives to fill the gap until Russia reaches the necessary production capacity," she said.

Microchips have been an issue for Russia since the first set of sanctions imposed for its annexation of Crimea in 2014. These have impacted its military-industrial complex and caused a lag in its production of high-precision weapons.

"This ban is not likely to cause any more severe disruptions, given that Russia has been suffering from this shortage for almost a decade, leading to adaptation," Miron said.

Miron noted that Russia still has companies like MCST that produce Elbrus processors, which were made in Taiwan, but production was shifted to its plant in Zelenograd after the war started.

"So, there is an indication that Russian tech companies will try to keep manufacturing abroad, and if that is not possible, they will try to bring the expertise back home," she said.

Vitaly Mankevich, chair of the Russian-Asian Union of Industrialists and Entrepreneurs (RASPP) told Kommersant there was no official Chinese government statement regarding the Loongson ban and that in any case, Beijing would not draw attention to sales to Russia. However, he added there were still ways to purchase such products, "including through third parties, smaller companies."

Chinse president Xi Jinping is Putin's most important ally and has stayed neutral on Russia's invasion of Ukraine. Despite its status as Russia's major trading partner, Beijing has so far respected sanctions such as export controls at Russia's military and has not tried to sell military hardware or components.

In March, U.S. Commerce Secretary Gina Raimondo warned that Chinese companies that defied U.S. restrictions against exporting to Russia would be cut off from American equipment and software they need to make their products.

Newsweek reached out to Loongson, the Chinese foreign ministry, and Russia's digital development ministry for comment.