Semiconductors manufacturing companies ban business with Russia

While the world was already dealing with the semiconductors crisis, the companies manufacturing the parts are banning the sales to Russia after the reports of its invasion in Ukraine came to light. Despite the announcements, the analysts have said that it should not much of an effect. The Russian military force continued to bombard the Ukrainian capital Kyiv on February 28, 2022. On the other hand the sanctions against Russia is growing on a global scale.

Pressure is also being made to exclude Russia from the SWIFT interbank messaging network. Even the Treasury Department is prohibiting to do business with the central bank in Russia. Meanwhile, the entire semiconductor industry has joined together for not trading with Russia after President Vladimir Putin ordered an invasion in Ukraine. On the other hand the analysts did not seem much concerned about the situation as they opined that Russia is a direct purchaser of semi-conductors themselves and cited a report from the Semiconductor Industry Association (SIA).

The SIA in a statement released last week said that Russia accounted for less than 0.1% of the global chip sales. While talking about the figures Russia accounted for less than $560 million in sales in 2021. Analyst Stacy Rasgon in a note said that Russia accounts for less than 2% of the global PC shipments, 1% server shipments, 2% handset and smartphone shipments and 2% of automotive shipments. Rasgon added that with the above figures they do not expect much impact on the number of end markets that are major drivers of semiconductor demand.

SIA also informed that Russia accounted for nearly $50.3 billion in front of the broader $4.47 trillion information communication technology market across the globe or just a little above 0.1%. After the invasion reports came out the U.S Commerce Department’s Bureau of Industry and Security had passed the board export controls against Russia. Intel Corp also confirmed that it is complying with the restrictions.

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