Category: Бізнес

економічні і бізнесові новини

Energy Contingency Plan in Motion Amid Russia-Ukraine Crisis 

The Biden administration has been working with European countries and energy producers around the world on ways to supply fuel to Western European countries should Russian President Vladimir Putin slash oil and gas exports in retaliation for sanctions imposed for an invasion of Ukraine. 

“We’ve been working to identify additional volumes of non-Russian natural gas from various areas of the world from North Africa and the Middle East to Asia and the United States,” a senior administration official said in a briefing with reporters on Tuesday. 

The contingency plan is aimed to reassure European allies concerned about the impact of Russia weaponizing its energy supply. Moscow provides approximately 40% of Europe’s natural gas, and European energy stockpiles have been significantly lower in the past few months because of reduced Russian supplies. 

A second senior administration official underscored that oil and gas exports make up about half of Russia’s federal budget revenues, which means that Moscow is just as dependent on its energy revenue as Europe is on its supply. 

“If Russia decides to weaponize its supply of natural gas or crude oil, it wouldn’t be without consequences to the Russian economy,” the official said. 

White House press secretary Jen Psaki declined to confirm reporting that Qatar is one of the countries that the U.S. and European allies are turning to.

“Our approach is not about any one country or any individual entity,” she said while briefing reporters Tuesday, adding that the administration is engaging with major buyers and suppliers of liquefied natural gas to ensure flexibility in existing contracts to enable diversion to Europe if needed. 

President Joe Biden is set to meet with Amir Tamim bin Hamad Al Thani of Qatar at the White House on January 31. According to the White House, ensuring the stability of global energy supplies will be one of the topics discussed by the leaders. 

While having a contingency plan is important, analysts say it won’t be easy to substitute for existing infrastructure, particularly under the current global supply chain crisis. 

“Think of a gas pipeline as a faucet. … It’s super-efficient,” said Kristine Berzina, a senior fellow at The German Marshall Fund of the United States. Berzina told VOA that a contingency plan would be “more of a bucket than it is a faucet.” 

US-Europe unity 

On Monday, Biden said there was total unity among Western powers on the issue of Russia’s pressure on Ukraine. 

“I had a very, very, very good meeting — total unanimity with all the European leaders,” Biden told reporters shortly after a videoconference with European leaders on the escalating Russia-Ukraine conflict. 

Some analysts, however, say Biden maybe overplaying talk of unity. 

“In Europe, people are not as gung-ho and trigger-happy as they are here in the United States,” said Nina Khrushcheva, a professor of international affairs at The New School, in New York. 

For months, the U.S. and European allies have warned of swift and severe economic consequences if Putin invades Ukraine. But some European allies have been nervous about the impact on their economies, including on the supply of Russian natural gas — particularly during the winter months. 

Germany is especially reliant on Russian energy. Berlin has remained ambiguous about whether in the event of war it is prepared to shut down the just-completed Nord Stream 2 undersea pipeline, which will pump natural gas from Russia to Germany. 

“Despite all this conversation of the united West over Russia, it’s not as united,” Khrushcheva said. “And Putin knows that.” 

On Tuesday, Biden reiterated his position. “I made it clear to Putin early on if he went into Ukraine there would be consequences,” he said.

But analysts say that in moving forward with his harsh rhetoric on Russian sanctions, Biden needs to be mindful of the political calculation for European leaders. 

“The Western European population isn’t necessarily willing to suffer for Ukraine,” Berzina said. 

On Monday, the U.S. put 8,500 troops on heightened alert for possible deployment to Eastern Europe, amid escalating tensions in the crisis along the Russia-Ukraine border, where Putin has deployed 127,000 troops, according to U.S. and Ukrainian estimates. 

The Russian troop deployment is similar to Moscow’s move ahead of its 2014 annexation of Crimea, a peninsula on the Black Sea, which triggered a series of international sanctions against Moscow but ultimately failed to deter Putin’s land grab. 

“They have not only shown no signs of de-escalating — they are in fact adding more force capability,” Pentagon spokesman John Kirby said about the Russian military buildup during a press briefing on Monday. 

Both countries stepped up their military preparations Tuesday, with Moscow conducting a series of military exercises and Washington delivering a fresh shipment of weapons to Ukraine. 

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Explainer: What Post-unrest Reforms Is Kazakhstan Proposing?

Kazakhstan’s leader has trumpeted ambitious economic reforms following the worst unrest in the country of 19 million in three decades. The measures are aimed at reducing the state’s deep involvement in the economy, bridging the gap between the wealthy minority and the struggling majority — and eliminating triggers for further turmoil. 

Experts say the announced changes look good on paper, but they question whether the new government in the energy-rich former Soviet state will implement them. 

A look at the causes of discontent and the government’s promised reforms: 

What’s roiling Kazakhstan? 

On January 2, small protests broke out in an oil city in western Kazakhstan where residents were unhappy about a sudden spike in prices for liquified gas, which is widely used as automotive fuel. 

The demonstrations soon spread across the vast country, reflecting wider public discontent with steadily decreasing incomes, worsening living conditions and the authoritarian government. By January 5, the protests descended into violence, with armed groups storming government buildings and setting cars and buses on fire in Kazakhstan’s largest city, Almaty. 

To quell the violence, President Kassym-Jomart Tokayev requested help from a Russia-led security alliance, the Collective Security Treaty Organization. The bloc of six former Soviet states sent more than 2,000 troops. 

Authorities arrested thousands of people, and more than 220 — mostly civilians — were killed. About a week after the protests began, order was largely restored.

Why were gas prices such a sore point?

The price of gas soared to $0.27 (120 tenge) per liter, a significant increase in the country where, according to Tokayev’s own admission, half the population earns no more than $114 (50,000 tenge) a month. The spike came about as the government moved away from price controls as part of efforts to build a market economy. 

Analysts say the increase came as a complete surprise. 

“All these decisions were made without transparency. … People woke up to a new gas price that was 2½ times higher,” said Kassymkhan Kapparov, an economist in Kazakhstan and founder of the Ekonomist.Kz think tank. 

The western region of Kazakhstan where the protests started also produces oil and gas. Residents were outraged that the price increased while their salaries remained stagnant, said Rustam Burnashev of the Kazakh-German University in Almaty, an expert on regional security in Central Asia. 

“They were saying, ‘Guys, we’re producing it, and now we (have to) buy it at astronomical prices?’ They agree that gas prices (all over the world) grow, but in that case (they say) that our salaries should too,” Burnashev said. 

How did Kazakhstan end up in this situation? 

Kazakhstan became independent when the Soviet Union collapsed in 1991. In the first post-independence years, the country saw rapid economic growth and rising prosperity. For almost three decades, it was dominated by Nursultan Nazarbayev, its last Communist Party leader at the time of independence. 

The country profited from its natural resources, most notably oil. Foreign investors were welcome, money flowed into state coffers, and social spending helped keep abject poverty low. But key sectors such as mining, telecommunications and banking were dominated by state-owned companies and a few figures connected to Nazarbayev, either politically or through family ties. 

As time went on, Nazarbayev increasingly monopolized the country’s politics, suppressing opposition and introducing a highly personalized form of rule as “Elbasy,” or “leader of the nation.” Nazarbayev resigned in 2019 but until recently remained head of the ruling Nur Otan party and chair of the Security Council. Tokayev, the chair of the upper house of parliament, was appointed president and renamed the capital of Astana to Nur-Sultan, to honor his predecessor. 

What are the issues behind the public discontent? 

Discontent among ordinary people goes way beyond gas prices. People are aware of the immense economic privilege of those around Nazarbayev and the country’s striking level of inequality, in which 162 people control more than half the country’s wealth.

Meanwhile, the average monthly wage is around $558 (243,000 tenge), according to government statistics, although the cost of living is relatively low compared with that of Western countries. 

A recent report by the Organized Crime and Corruption Reporting Project found that a charitable foundation created by Nazarbayev held assets worth $7.8 billion, including stakes in banking, shopping centers, logistics firms and food production. 

British authorities issued “unexplained-wealth orders” to Nazarbayev’s daughter and grandson, demanding the two reveal where they obtained funds for three London properties worth more than $108 million (80 million pounds). A judge threw out the orders. 

What approach is the current president taking?

Tokayev publicly acknowledged Kazakhstan’s rampant inequality and initially tried to quell the protests with a few concessions: He capped gas prices for 180 days, named a new Cabinet and ousted Nazarbayev from the National Security Council. 

The president outlined future reforms to “reset” the economy, remarking, “We need to define new ‘rules of play’ — fairer, more transparent and just.” 

Some of the ambitious measures he touted included reducing the government’s involvement in and oligarchs’ influence on business; reforming the Samruk-Kazyna sovereign wealth fund, which owns major companies; and ensuring fair competition, a better investment climate and the integrity of private property, in part by overhauling the country’s justice system. 

What chance of success do the proposed reforms have?

Kapparov, the economist, said important questions remain about the Samruk-Kazyna fund and its companies. 

“Will there be a privatization? On what scale? In which time frame?” he asked. “Will it be open to everyone, including foreign investors? These issues haven’t been mentioned.” 

The inner circle’s power and influence raise serious obstacles to any wide-ranging reform that would be required to privatize state companies and allow outside interests to compete in key sectors, said former World Bank official Simon Commander, now managing partner at emerging markets advisory firm Altura Partners. Tokayev’s speech, while interesting, is “certainly more radical than is likely to be possible. … Let’s hope he turns out to be a genuine reformer.” 

But he added: “I’m very skeptical. Their economic and political structure hems them in.” 

What about political reforms? 

During his years in office, Tokayev has also promised limited political reforms, including local elections. 

But the crackdown on protesters suggests authorities don’t intend to allow genuine political opposition, and without political reform, economic reform is difficult to imagine. 

Greeting discontent with more than 12,000 arrests “is a pretty good metric for how the regime thinks it needs to respond,” Commander said. 

 

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Biden Says He Is Open to Sanctioning Putin Personally if Russia Invades Ukraine

Russia says it is watching “with great concern” a U.S. move to put 8,500 troops on alert for possible deployment to Eastern Europe, amid fears a Russian invasion of Ukraine could be imminent. As VOA’s senior diplomatic correspondent Cindy Saine reports, diplomatic efforts continue as the U.S. and NATO boost their military deterrence.

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Capsized Boat Found Near Florida; 39 People Missing

The U.S. Coast Guard searched on Tuesday for 39 people missing for several days after a boat believed to be used for human smuggling capsized off Florida’s coast en route from the Bahamas. 

A good Samaritan called the Coast Guard early Tuesday after rescuing a man clinging to the boat 72 kilometers (45 miles) east of Fort Pierce, the maritime security agency reported on Twitter.

The man said he was with a group of 39 others who left the island of Bimini in the Bahamas on Saturday night. He said the boat capsized in severe weather and that no one was wearing life jackets. 

The Coast Guard is calling it a suspected human smuggling case. Officials said on Twitter that they are searching by air and sea over a roughly 218-kilometer (135-mile) area extending from Bimini to the Fort Pierce Inlet.

A cold front late Saturday brought rough weather to the Bimini area. Tommy Sewell, a local bonefishing guide, said there were 32 kph (20 mph) winds and fierce squalls of rain on Sunday into Monday.

Migrants have long used the islands of the Bahamas as a steppingstone to reach Florida and the United States. They typically try to take advantage of breaks in the weather to make the crossing, but the vessels are often dangerously overloaded and prone to capsizing. There have been thousands of deaths over the years. 

The Coast Guard patrols the waters around Haiti, the Dominican Republic, Cuba and the Bahamas.

For the most part, the migrants are from Haiti and Cuba, but the Royal Bahamas Defense Force has reported apprehending migrants from other parts of the world, including from Colombia and Ecuador earlier this month. 

On Friday, the Coast Guard found 88 Haitians in an overloaded sail freighter west of Great Inagua, Bahamas. 

“Navigating the Florida straits, Windward and Mona Passages … is extremely dangerous and can result in loss of life,” the Coast Guard said in a statement last weekend. 

Last July, the Coast Guard rescued 13 people after their boat capsized off Key West as Tropical Storm Elsa approached.

The survivors said they had left Cuba with 22 people aboard. Nine went missing in the water. 

 

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State Department Releases Annual Trafficking in Persons Report

The COVID-19 pandemic has exacerbated human trafficking, the U.S. State Department said in its annual Trafficking in Persons Report released Tuesday. 

“This year’s Trafficking in Persons Report sends a strong message to the world that global crises, such as the COVID-19 pandemic, climate change, and enduring discriminatory policies and practices, have a disproportionate effect on individuals already oppressed by other injustices,” U.S Secretary of State Antony Blinken said in the report’s introduction.

“These challenges further compound existing vulnerabilities to exploitation, including human trafficking,” he said. 

In the report, Blinken calls for other countries to join the United States to improve “our collective efforts to comprehensively address human trafficking.” 

He said doing so requires mitigating “harmful practices and policies that cause socioeconomic or political vulnerabilities that traffickers often prey on.” 

The report said the COVID-19 pandemic has brought “unprecedented repercussions for human rights and economic development globally, including in human trafficking.” 

“Governments across the world diverted resources toward the pandemic, often at the expense of anti-trafficking efforts, resulting in decreased protection measures and service provision for victims, reduction of preventative efforts, and hindrances to investigations and prosecutions of traffickers,” the report said. 

The report explained that those involved in anti-trafficking efforts “found ways to adapt and forged new relationships to overcome the challenges.” It added that traffickers were also adept in altering their methods. 

Some specific cases mentioned in the report include examples in India and Nepal in which young poor girls left school to help support their families due to the pandemic’s economic impact. Some, the report said, were forced into marriage for money. 

The report cites incidents in the United States, the United Kingdom and Uruguay in which landlords forced female tenants who were economically hurt by the pandemic to have sex with them when the tenant could not pay rent. 

In Haiti, Niger and Mali, “gangs” working in camps for displaced people used lax security caused by the pandemic to force residents into sex-for-money acts. 

In Myanmar (formerly Burma), which has been roiled by COVID-19 and political unrest, the report said 94% of households saw a decline in income, leaving some members vulnerable to sex trafficking. 

“If there is one thing we have learned in the last year, it is that human trafficking does not stop during a pandemic,” Kari Johnstone, senior official and principal deputy director of the Office to Monitor and Combat Trafficking in Persons, said in the report’s introduction.

“The concurrence of the increased number of individuals at risk, traffickers’ ability to capitalize on competing crises, and the diversion of resources to pandemic response efforts has resulted in an ideal environment for human trafficking to flourish and evolve,” Johnstone said. 

 

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US Warns Russia Economic Sanctions Would Be Sharper Than in 2014

The United States warned Russia Tuesday that it would face faster and far more severe economic consequences if it invades Ukraine than it did when Moscow annexed Ukraine’s Crimean Peninsula in 2014.

“We are prepared to implement sanctions with massive consequences that were not considered in 2014,” a national security official told reporters in Washington. “That means the gradualism of the past is out. And this time, we’ll start at the top of the escalation ladder and stay there.”

The official, speaking anonymously, said the U.S. is “also prepared to impose novel export controls” to hobble the Russian economy.

“You can think of these export controls as trade restrictions in the service of broader U.S. national security interests,” the official said.

“We use them to prohibit the export of products from Russia,” the official said. “And given the reason they work is if you … step back and look at the global dominance of U.S.-origin software technology, the export control options we’re considering alongside our allies and partners would hit (Russian President Vladimir) Putin’s strategic ambitions to industrialize his economy quite hard, and it would impair areas that are of importance to him, whether it’s in artificial intelligence, quantum computing, or defense or aerospace or other key sectors.”

The U.S. and its allies imposed less severe economic sanctions against Moscow after its Crimean takeover, but they ultimately proved ineffective, and the peninsula remains under Russian control.

The U.S. is also working with energy producers around the world, another security official said, to supply fuel to Western European countries in the event Putin cuts off Russia’s flow of natural gas to the West.

One of the U.S. security officials echoed President Joe Biden in saying that the U.S. and its Western allies are “unified in our intention to impose massive consequences that would deliver a severe and immediate blow to Russia over time, make its economy even more brittle and undercut Putin’s aspirations to exert influence on the world stage.”

Tuesday’s White House warning came as Russia said it is watching “with great concern” as the U.S. on Monday put 8,500 troops on heightened alert for possible deployment to Eastern Europe. 

Kremlin spokesman Dmitry Peskov repeated to reporters Russian accusations that the United States is escalating tensions in the crisis along the Russia-Ukraine border, where Putin has deployed an estimated 127,000 troops. 

 

Biden met virtually Monday with key European leaders to discuss the ongoing threat of a Russian invasion of Ukraine.  

“I had a very, very, very good meeting — total unanimity with all the European leaders,” Biden told reporters after hosting a secure video call with allied leaders from Europe, the European Union and NATO.  

British Prime Minister Boris Johnson’s office released a statement that supported Biden’s summation, saying, “The leaders agreed on the importance of international unity in the face of growing Russian hostility.” 

Biden has not decided whether to move U.S. military equipment and personnel closer to Russia. But White House press secretary Jen Psaki said in advance of the meeting with the European officials that the United States has “always said we’d support allies on the eastern flank” abutting Russia.  

U.S. Defense Secretary Lloyd Austin placed 8,500 U.S. military personnel on “high alert” of being dispatched to Eastern Europe, where most of them could be activated as part of a NATO response force if Russia invades Ukraine.  

“It’s very clear the Russians have no intention right now of de-escalating,” Pentagon spokesperson John Kirby told reporters. “What this is about, though, is reassurance to our NATO allies.” 

Biden has ruled out sending troops to Ukraine if Russia invades the onetime Soviet republic but vowed to impose quick and severe economic sanctions on Moscow.  

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Putin ‘Playing Poker Rather Than Chess,’ Says Former UK Spy Chief

Why won’t Russia’s Vladimir Putin let Ukraine go? He might not be able to, according to a former head of Britain’s MI6 external intelligence agency, Alex Younger.  

In an interview Tuesday with the BBC, Younger said he cannot see how the Russian leader can back down as fears mount that Putin is poised to order a Russian invasion of Ukraine, a former Soviet republic.

Younger said the Russian president was “playing poker rather than chess” to create options for himself. But Younger added, “At the moment I cannot see a scenario where he can back down in a way that satisfies the expectations that he has created.”

He added, “It feels dangerous and it’s clearly getting more dangerous. It’s hard to see a safe landing zone given the expectations that President Putin has created.”

British officials Tuesday said elements of a “Russian military advance force” are already active inside Ukraine. “We are becoming aware of a significant number of individuals that are assessed to be associated with Russian military advance force operations and currently located in Ukraine,” said James Heappey, Britain’s armed forces minister.

His remarks coincided with Ukraine’s SBU security service saying in a statement it had broken up a group of saboteurs preparing a series of destabilizing attacks along Ukraine’s borders. The SBU said the saboteurs intended to target infrastructure “coordinated by Russian special services.”

Last week, the Pentagon accused Russia of preparing false flag attacks. “It has pre-positioned a group of operatives to conduct what we call a false flag operation, an operation designed to look like an attack on them or Russian-speaking people in Ukraine as an excuse to go in,” Pentagon spokesman John Kirby told reporters in Washington.

Russian officials deny any plans to invade Ukraine, despite their building up military forces along their neighbor’s borders, where Ukraine’s defense ministry estimates 127,000 troops have been deployed. Kremlin spokesman Dmitry Peskov has dismissed accusations that Russia plans to stage an offensive, describing the charges as “hysteria.”

But as tensions soar in eastern Europe, some Western diplomats and analysts fear the geopolitical confrontation is approaching a point where it might be impossible to avoid conflict and Putin may have backed himself into a position where he has no off-ramp, if he is not to lose face.

Putin has long appeared set on challenging the outcome of the Cold War and eager to re-establish a Russian sphere of influence in eastern Europe. Maintaining influence over Ukraine and halting the country from joining NATO are crucial elements of that project.

“Vladimir Putin sees the current security architecture as both unacceptable and dangerous to Russia. It is unacceptable because it manifests a series of tightening military, political, and economic relationships between Ukraine and the West, and Putin sees the West as fundamentally hostile to Russia,” according to Liana Fix and Michael Kimmage of the German Marshall Fund, a Washington-based research group.

“What Putin wants is to unwind the tightening military, political, and economic relationships between Ukraine and the West. He realizes that this aim cannot be accomplished through persuasion alone,” they add.

Ukraine’s drift toward the West has long frustrated the Russian leader. In 2008, Putin told then-U.S. President George W. Bush, “You have to understand, George, that Ukraine is not even a country.” He has not shifted his view since. After annexing Crimea, and as separatist agitation encouraged by the Kremlin in eastern Ukraine intensified, Putin said, “Russians and Ukrainians are one people. Kyiv is the mother of Russian cities. Ancient Russia is our common source, and we cannot live without each other.”  

Last year the Russian leader wrote a 5,000-word tract, titled, “On the Historical Unity of Russians and Ukrainians” in which he argued Ukraine can only be sovereign in partnership with Russia and has been weakened by the West’s efforts to undermine Slav unity. One historian described the essay as a “call to arms.”

The rallying cry predates that essay, though. Back in November 2014 in Donetsk, newly arrived pro-Moscow fighters from Russia’s Caucasus region, mainly Chechens and Ossetians, were in no doubt as to why they were in Ukraine’s Donbas region, recently seized by a rag-tag collection of insurrectionists, separatists and unemployed youngsters.

As far as they were concerned, they were defending Mother Russia from NATO and reclaiming Ukraine. A bearded 28-year-old ethnic Ossetian, a bear of a man with a gnarled left ear and veteran of Russia’s 2008 five-day war against Georgia, told this correspondent, “Two of my grandparents were killed here in Ukraine during the Second World War fighting against the fascists, and I have to finish their work.”

He and his Ossetian comrades, seasoned combat fighters, claimed to be on leave from the Russian military. They said the Maidan uprising that toppled Ukrainian President Viktor Yanukovych, an ally of President Putin, nearly a decade ago, was the handiwork of NATO, the Americans and Europeans and all part of a plot against Russia.

“NATO bullied us in Georgia and now they are doing the same again here, and we have to stop them. This is the land of my ancestors, and I have to participate. If you don’t stop fascists, they grow, and when we have finished here in the Donbas, we will then go to Kyiv.”

The march on Kyiv never happened and the conflict remained limited to the Donbas, claiming from its outset more than 15,000 lives. Some fear Putin, who famously dubbed the collapse of the Soviet empire “the greatest geopolitical catastrophe of the century,” might seriously be weighing an assault on Ukraine’s capital.

The Chechens, Ossetians and ethnic Russians arrived in large numbers in late 2014 to stiffen and organize local separatists and help them organize a pushback against a Ukrainian counter-offensive. They were parroting what they had heard from the Kremlin since Putin first took office in 1999, but which has led to a crescendo since 2008 that Russia is besieged by determined adversaries and was robbed when the Soviet Union collapsed, with the biggest theft being Ukraine.

That view, though, glides past the history of the breakup of the Soviet Union. It collapsed itself in the wake of a failed KGB coup to unseat Soviet leader Mikhail Gorbachev when Russia’s Boris Yeltsin and his counterparts in Ukraine and Belarus announced after meeting in December 1991: “the USSR as a subject of international law and geopolitical reality has ceased to exist.”

Western leaders had no hand in the dissolution of the Soviet Union, say authoritative historians, and it prompted the alarm of Western leaders, who worried about what would happen to the Soviet nuclear arsenal, which was spread out across Russia, Ukraine and Belarus.

Nonetheless, Putin “looks more determined than ever” to turn the clock back, says Frederick Kempe, president of the Atlantic Council, a U.S.-based research group. He sees Putin as an opportunist testing the West but with a clear direction.

“The problem isn’t the nature of Putin’s next move but rather the troubling trajectory behind it, one that has included Russia’s 2008 invasion of Georgia, its 2014 annexation of Crimea,” he says.

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COVID Cases Surge Among US Children as Omicron Sweeps America

In mid-January the average number of daily new COVID cases in the U.S. fluctuated between 750,000 and 800,000, according to the CDC COVID Data Tracker. Children under five remain one of the most vulnerable groups since they cannot be vaccinated yet. In the first week of January, over half a million young children were diagnosed with COVID-19, an 80% increase compared to late December 2021. Mariia Prus has the story, narrated by Anna Rice. Video editor – Kim Weeks.

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Delay in Creating New US Cybersecurity Board Prompts Concern

It’s a key part of President Joe Biden’s plans to fight major ransomware attacks and digital espionage campaigns: creating a board of experts that would investigate major incidents to see what went wrong and try to prevent the problems from happening again — much like a transportation safety board does with plane crashes.

But eight months after Biden signed an executive order creating the Cyber Safety Review Board it still hasn’t been set up. That means critical tasks haven’t been completed, including an investigation of the massive SolarWinds espionage campaign first discovered more than a year ago. Russian hackers stole data from several federal agencies and private companies.

Some supporters of the new board say the delay could hurt national security and comes amid growing concerns of a potential conflict with Russia over Ukraine that could involve nation-state cyberattacks. The FBI and other federal agencies recently released an advisory — aimed particularly at critical infrastructure like utilities — on Russian state hackers’ methods and techniques.

“We will never get ahead of these threats if it takes us nearly a year to simply organize a group to investigate major breaches like SolarWinds,” said Sen. Mark Warner, a Virginia Democrat who leads the Senate Intelligence Committee. “Such a delay is detrimental to our national security and I urge the administration to expedite its process.”

Biden’s order, signed in May, gives the board 90 days to investigate the SolarWinds hack once it’s established. But there’s no timeline for creating the board itself, a job designated to Department of Homeland Security Secretary Alejandro Mayorkas.

In response to questions from The Associated Press, DHS said in a statement it was far along in setting it up and anticipated a “near-term announcement,” but did not address why the process has taken so long.

Scott Shackelford, the cybersecurity program chair at Indiana University and an advocate for creating a cyber review board, said having a rigorous study about what happened in a past hack like SolarWinds is a way of helping prevent similar attacks.

“It sure is taking, my goodness, quite a while to get it going,” Shackelford said. “It’s certainly past time where we could see some positive benefits from having it stood up.”

The Biden administration has made improving cybersecurity a top priority and taken steps to bolster defenses, but this is not the first time lawmakers have been unhappy with the pace of progress. Last year several lawmakers complained it took the administration too long to name a national cyber director, a new position created by Congress.

The SolarWinds hack exploited vulnerabilities in the software supply-chain system and went undetected for most of 2020 despite compromises at a broad swath of federal agencies and dozens of companies, primarily telecommunications and information technology providers. The hacking campaign is named SolarWinds after the U.S. software company whose product was exploited in the first-stage infection of that effort.

The hack highlighted the Russians’ skill at getting to high-level targets. The AP previously reported that SolarWinds hackers had gained access to emails belonging to the then-acting Homeland Security Secretary Chad Wolf.

The Biden administration has kept many of the details about the cyberespionage campaign hidden.

 

The Justice Department, for instance, said in July that 27 U.S. attorney offices around the country had at least one employee’s email account compromised during the hacking campaign. It did not provide details about what kind of information was taken and what impact such a hack may have had on ongoing cases.

The New York-based staff of the DOJ Antitrust Division also had files stolen by the SolarWinds hackers, according to one former senior official briefed on the hack who was not authorized to speak about it publicly and requested anonymity. That breach has not previously been reported. The Antitrust Division investigates private companies and has access to highly sensitive corporate data.

The federal government has undertaken reviews of the SolarWinds hack. The Government Accountability Office issued a report this month on the SolarWinds hack and another major hacking incident that found there was sometimes a slow and difficult process for sharing information between government agencies and the private sector, The National Security Council also conducted a review of the SolarWinds hack last year, according to the GAO report.

But having the new board conduct an independent, thorough examination of the SolarWinds hack could identify inconspicuous security gaps and issues that others may have missed, said Christopher Hart, a former National Transportation Safety Board chairman who has advocated for the creation of a cyber review board.

“Most of the crashes that the NTSB really goes after … are ones that are a surprise even to the security experts,” Hart said. “They weren’t really obvious things, they were things that really took some deep digging to figure out what went wrong.”

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London Police Investigating Lockdown Parties at British PM’s Offices 

London police said Tuesday they were investigating Downing Street lockdown parties in 2020 to determine if U.K. government officials violated coronavirus restrictions, putting further pressure on Prime Minister Boris Johnson. 

The Metropolitan Police Service has launched an inquiry into “a number of events” at Downing Street because they met the force’s criteria for investigating the “most serious and flagrant” breaches of COVID-19 rules, Commissioner Cressida Dick told the London Assembly, the capital’s local government council. 

Johnson is facing calls to resign amid revelations that he and his staff attended a series of parties during the spring and winter of 2020 when most social gatherings were banned throughout England, forcing average citizens to miss weddings, funerals and birthdays as friends and relatives died alone in hospitals. The gatherings are already being investigated by a senior civil servant Sue Gray whose report, expected this week, will be crucial in determining whether Johnson can remain in power. 

The Cabinet Office said Gray’s investigation would continue. But it wasn’t immediately clear whether Gray would have to delay the announcement of her findings because of the police investigation. 

Johnson has apologized for attending a party in the garden of his Downing Street offices in May 2020, but said he had considered it a work gathering that fell within the social distancing rules in place at the time. 

In the latest revelation, ITV News reported late Monday that Johnson attended a birthday party in his Downing Street office and later hosted friends at his official residence upstairs in June 2020. His office denied that the gathering violated lockdown regulations, saying that the prime minister hosted a small number of family members outdoors, which was in line with rules at the time. 

London Mayor Sadiq Khan welcomed the police investigation. 

“The public rightly expect the police to uphold the law without fear or favor, no matter who that involves, and I have been clear that members of the public must be able to expect the highest standards from everyone, including the Prime Minister and those around him,” Khan said in a statement. “No one is above the law. There cannot be one rule for the government and another for everyone else.” 

Police have previously faced criticism for suggesting that they wouldn’t investigate the “partygate” scandal because they don’t routinely investigate historical breaches of coronavirus regulations. 

But Dick told the assembly that an investigation was warranted in this case because there is evidence that those involved knew or should have known that what they were doing was illegal, not investigating would “significantly undermine the legitimacy of the law,” and there seems to be no reasonable defense for the conduct. 

“So in those cases, where those criteria were met, the guidelines suggested that we should potentially investigate further and end up giving people tickets,” she said. 

Fixed penalty notices at the time carried a maximum fine of 10,000 pounds (nearly $13,500).

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Report: Anti-corruption Fight Is Stalled, COVID Not Helping

Most countries have made little to no progress in bringing down corruption levels over the past decade, and authorities’ response to the COVID-19 pandemic in many places has weighed on accountability, a closely watched study by an anti-graft organization found Tuesday.

Transparency International’s 2021 Corruption Perceptions Index, which measures the perception of public sector corruption according to experts and business people, found that “increasingly, rights and checks and balances are being undermined not only in countries with systemic corruption and weak institutions, but also among established democracies.”

Among other issues over the past year, it cited the use of Pegasus software, which has been linked to snooping on human rights activists, journalists and politicians across the globe.

The report said the pandemic has “been used in many countries as an excuse to curtail basic freedoms and sidestep important checks and balances.”

In Western Europe, the best-scoring region overall, the pandemic has given countries “an excuse for complacency in anti-corruption efforts as accountability and transparency measures are neglected or even rolled back,” Transparency said. In some Asian countries, it said, COVID-19 “also has been used as an excuse to suppress criticism.” It pointed to increased digital surveillance in some nations and authoritarian approaches in others.

The report ranks countries on a scale from a “highly corrupt” 0 to a “very clean” 100. Denmark, New Zealand and Finland tied for first place with 88 points each; the first two were unchanged, while Finland gained three points. Norway, Singapore, Sweden, Switzerland, the Netherlands, Luxembourg and Germany completed the top 10. The U.K. was 11th with 78.

The United States, which slipped over recent years to hit 67 points in 2020, held that score this time but slipped a couple of places to 27th. Transparency said it dropped out of the top 25 for the first time “as it faces continuous attacks on free and fair elections and an opaque campaign finance system.”

Canada, which slid three points to 74 and two places to 13th, “is seeing increased risks of bribery and corruption in business,” the group said. It added that the publication of the Pandora Papers showed Canada as “a hub for illicit financial flows, fueling transnational corruption across the region and the world.”

The index rates 180 countries and territories. South Sudan was bottom with 11 points; Somalia, with which it shared last place in 2020, tied this time with Syria for second-to-last with 13. Venezuela followed with 14 — then Yemen, North Korea and Afghanistan tied with 16 apiece.

Transparency said the control of corruption has stagnated or worsened in 86% of the countries it surveyed in the last 10 years. In that time, 23 countries — including the U.S., Canada, Hungary and Poland — have declined significantly in its index, while 25 have improved significantly. They include Estonia, the Seychelles and Armenia.

Compiled since 1995, the index is calculated using 13 different data sources that provide perceptions of public sector corruption from business people and country experts. Sources include the World Bank, the World Economic Forum and private risk and consulting companies.

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Slovenian Trade Group Reports Chinese Backlash after PM Praises Taiwan

A Slovenian business group has said its members are facing a Chinese backlash days after Prime Minister Janez Jansa publicly discussed his hopes for closer ties with Taiwan during an interview. It marks the latest case of China refusing to tolerate dissent on the issue of Taiwan’s autonomy.  

On January 17, Jansa told Indian media that he hoped Taiwan and Slovenia could open mutual representative offices. He also praised Taiwan’s COVID-19 response and said Taiwan should determine its relationship with China independently. Opening offices in Taiwan would bring Slovenia in line with the rest of the European Union, as it is one of only a handful of countries — including Bulgaria, Croatia, Estonia, Malta, and Romania — without a Taiwanese mission.    

Swift criticism against Jansa came from the Chinese government describing his remarks as “dangerous.” China considers Taiwan a province and treats any discussion of its disputed political status as taboo. 

Moreover, within days of the interview, the Slovenian-Chinese Business Council said Chinese partners were already “terminating contracts and exiting the agreed investments,” according to the Slovenian Press Agency. The business group and its parent organization, the CCIS- Ljubljana Chamber of Commerce and Industry, did not immediately respond to VOA’s email inquiries. 

The statement has also drawn fire both from Slovenia’s opposition and businesses with links to China. In an email response to VOA, Sasa Istenic, the director of the Taiwan Study Center at the University of Ljubljana, said his remarks “were his personal position not in tune with the National Assembly and could severely harm Slovenia’s economic cooperation with China.”   

Business groups in Slovenia fear they could suffer the same fate as Lithuania, which is now under a Chinese trade embargo in retaliation for pursuing closer ties with Taiwan, Istenic said.

“The Chinese market remains important for Slovenian companies and [the] Slovenian government has certainly been paying attention to China’s retaliation measures directed toward Lithuania,” Istenic said. “We have yet to see how far China is willing to go in preventing the EU member states from upgrading their relationships with Taiwan.”    

The EU maintains the “One China Policy” which recognizes Taiwan as part of the Chinese nation, and has traditionally had a less tumultuous relationship with Beijing than has the United States. But dissent is growing within the EU and some countries in Central and Eastern Europe have also found that promises of Chinese investment have not panned out as previously hoped, according to a 2021 report by the Central and Eastern Europe Center for Asian Studies.    

China’s growing strength in the Asia-Pacific region has also alarmed both the EU and NATO. The COVID-19 pandemic, combined with Beijing’s human rights violations in Xinjiang, Hong Kong and Tibet, have raised questions about its suitability as a close partner.

These concerns have given Taiwan a wedge to improve its relationship with some countries in Europe such as the Czech Republic, Slovakia, and, most notably, Lithuania.   

Lithuania and Taiwan have grown closer during the pandemic, swapping donations of vaccines and emergency protective gear. But, in April, Lithuania exited the Cooperation between China and Central and Eastern European Countries trade initiative, a group formed in 2012 to improve trade and investment and known colloquially as the “16+1.”    

In November, Taiwan opened a controversially named “Taiwan representative office” in Lithuania. The office angered Beijing as it broke with the tradition of Taiwan using more politically neutral names like “Taipei Economic and Cultural Office” or “Taipei Representative Office” that did not suggest it was an independent political entity.    

Aware of the economic cost of its closer ties, Taiwan has worked to offset some of the newfound economic pressure on Lithuania by pledging a combined $1.2 billion in investment across several sectors including industries like semiconductors, biotechnology and lasers.    

“[This] investment is meant to shape Taiwan’s image as a reliable partner and viable democratic alternative to China, so there is both a financial and a political dimension to these financial proposals for investment,” said Zsuzsa Anna Ferenczy, postdoctoral researcher in Taiwan and former political adviser in the European Parliament, over email.  

Access to Taiwan’s advanced technology sector could also be an attractive pull for other European countries, including Slovenia, whose automotive manufacturing and metallurgical industries rely on industrial robots. 

Una Aleksandra Berzina-Cerenkova, a China scholar and head of the Asia program at the Latvian Institute of International Affairs, said Slovenia’s plan to potentially upgrade ties with Taiwan is a sign that Europe has not lost interest in democracy despite coercive measures from Beijing.    

“It seemed that there was a bit of a loss of momentum when the Lithuania example was not being followed by others in terms of withdrawing from the 16+1 and then turning towards Taiwan,” said Berzina-Cerenkova by phone.  

“But we actually see that Lithuania is leading … against the backdrop of attracting all the heat to itself. The other Central and Eastern European countries are actually also exploring opportunities, and trying to ride this train of momentum in their relations with Taiwan, because Taiwan, of course, is an interesting partner.”    

Some sectors in Slovenia could have a lot more to lose, however, than Lithuania. While cumulative Chinese investment in Lithuania was just 82 million euros in 2020, according to the Central and Eastern Europe Center for Asian Studies, investment in Slovenia was valued at a far greater 1.5 billion euros over the same period. Much of that investment is represented by a single acquisition of a video game developer, the report said.   

Other countries in the EU may need more support to weather the Chinese economic backlash if they choose to strengthen ties with Taiwan. So far, said Ferenczy, that support has taken the form of statements of support and resolutions in the EU Parliament, but she said more is needed. 

“The EU’s toolbox is limited. It is in the process of drafting its anti-coercion instrument designed to reinforce its resilience. It will be key to ensure the instrument works effectively in order to make a difference in terms of pushing back against China’s coercion,” Ferenczy said. “So, whether Brussels will stand with Lithuania and jointly push back against such messaging all the way, is key for the EU’s credibility and its ambition to be able to defend its interests.” 

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White House Girds for Possible Russia Action in Ukraine

Washington has put 8,500 military personnel on heightened alert for possible deployment to Europe and will evacuate some embassy personnel from Ukraine, as tensions rise between Russia and NATO countries over Russian President Vladimir Putin’s continued mobilization of troops near the Ukrainian border. VOA White House correspondent Anita Powell reports from Washington.

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Guinea, Vanuatu Have UN Vote Restored After Paying Dues 

Guinea and Vanuatu had their ability to vote at the United Nations restored on Monday, having been denied the right at the beginning of the month over their failure to pay their dues to the world body, a UN spokeswoman said. 

“The General Assembly took note that Guinea, Iran and Vanuatu have made the payments necessary to reduce their arrears below the amounts specified in Article 19 of the Charter,” U.N. spokeswoman Paulina Kubiak said. 

“This means that they can resume voting in the General Assembly,” she said. 

Under Article 19, any country can have their voting rights in the General Assembly suspended if their payment arrears are equal to or greater than the contribution due for the past two full years. 

The payment Friday of more than $18 million by Iran, via an account in Seoul and most likely with the approval of the United States, which has imposed heavy financial sanctions on Tehran, had been announced at the end of last week by UN sources and confirmed by South Korea.

For their part, Guinea had to pay at least $40,000 and Vanuatu at least $194 to recover their right to vote.

Kubiak later added three other countries that lost their U.N. voting rights in early January had also recovered them after paying the minimum arrears required last week. 

Those countries were Sudan, which had to pay about $300,000, Antigua and Barbuda, which owed some $37,000 and Congo-Brazzaville, with around $73,000 in arrears, said the spokeswoman. 

On the other hand, Venezuela, which is facing a minimum payment of nearly $40 million, and Papua New Guinea, which must pay just over $13,000, remain deprived of the right to vote, according to the U.N.

They are the only two countries out of the 193 members of the United Nations that will not be able to participate in votes this year.

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Biden Administration Considers Technology Sanctions if Russia Invades Ukraine

In the months since Russia began massing troops on the border of Ukraine, the Biden administration has, on multiple occasions, warned that any further aggression by Moscow toward its neighbor would be met with unprecedented levels of sanctions. Now, the White House appears to be dropping some specific hints about what those sanctions might look like. 

 

According to multiple confirmed media reports, the administration has begun laying the groundwork for a ban on the sale of high-technology products containing U.S.-made components or software to Russia.

 

The plan echoes steps the Trump administration took against the Chinese telecommunications giant Huawei in 2020, barring vendors from selling the company semiconductors it needed to produce mobile telephone handsets. The ban had devastating consequences for Huawei’s business. Once the world leader in smartphone sales, it has fallen to 10th overall since the ban was put in place. 

 

The extent to which the administration intends to cut off Russian supplies of high-tech gear is unclear, and that’s probably intentional, experts said. 

 

“As with any sort of major event, or crisis, or potential invasion, government leaders want options … from strongest to weakest and everything in the middle, in terms of actions that can be taken,” Kevin Wolf, a former assistant secretary of Commerce for export administration in the department’s Bureau of Industry and Security, told VOA. 

 

Wolf, now a partner with the law firm Akin Gump in Washington, said that the administration is unlikely to signal exactly what action it will take unless Russia forces its hand by trying to take over more of Ukraine’s territory.

 

In 2014, in an earlier invasion, Russia took control of Crimea, a region of Ukraine, and continues to support local militias that control parts of the country’s Donbass region. 

 

Extraterritorial reach 

The U.S. appears to be considering the application of a new doctrine, the foreign direct product rule, to Russia. First put forward under the Trump administration, the rule would make it illegal under U.S. law for any entity in the world to sell high-technology equipment to Russia if that equipment was made or tested using U.S. technology. 

 

Theoretically, that could apply to virtually any product in the world that contains semiconductors, given the prevalence of U.S. technology and software involved in the devices’ manufacturing process. 

 

The rule relies on the implicit threat that companies that rely on U.S. technology or software to produce their products — even if the physical components of the products themselves originate outside the U.S. — could find themselves cut off from crucial licenses or equipment if they refuse to honor the U.S. export ban. 

 

The extreme reach of the rule, into the business dealings of non-U.S. firms, makes it politically fraught, according to Jim Lewis, senior vice president and director of the Strategic Technologies Program at the Center for Strategic and International Studies. 

 

However, speaking with VOA, Lewis said, “Using force against Ukraine really justifies it.” 

 

‘No more iPhones for Russia’ 

The U.S. has a wide range of options when it comes to blocking the transfer of technology to Russia, both in terms of the entities within Russia that the sanctions affect and the companies outside Russia that would be subject to them. (The U.S. already has export controls in place that target Russia’s defense sector, so anything the Biden administration applies would be in addition to those existing sanctions.) 

 

At the more targeted end of the spectrum, the administration could identify specific companies, making it illegal to sell U.S. technology to them. More broadly, the U.S. could impose sectorwide restrictions, barring the export of technology to, for example, the Russian civil aviation industry.

 

At the far end of the spectrum would be a flat-out ban on the sale of all U.S.-related technology to Russia.

 

“If they go for the maximum approach, that means no more iPhones for Russia,” said Lewis, of CSIS. 

 

Pushing Moscow toward China? 

If the U.S. does move forward with extensive technological sanctions against Russia, it will be difficult for Moscow to fill the gap with domestic production, said Jeffrey Edmonds, a senior analyst at the security think tank CNA. 

“Russia has always been fairly weak when it comes to things like microchips, microelectronics and electronics in general,” Edmonds told VOA. “That’s coupled with the fact that Russia has a very weak entrepreneurial system, in that most of the technology companies in that whole sector are really run by government-sponsored organizations that are highly inefficient and subject to high levels of corruption.” 

 

The result could be to push Moscow toward China, which has already been working to create a domestic manufacturing base that, in the future, might be able to provide Russia with homegrown equipment that would render U.S. sanctions ineffective. 

 

In an email exchange with VOA, research analysts Megan Hogan and Abigail Dahlman, at the Peterson Institute for International Economics, pointed out that United Nations data indicate that Russia already imports some 68% of its consumer IT products from China. 

 

“In the short term, the application of the (foreign direct product) rule will provide the Chinese government with further evidence of Western powers, particularly the U.S., meddling in Eastern affairs, validating the Chinese government’s … anti-foreign sanctions measures and further straining U.S.-China relations,” Hogan and Dahlman wrote. “Chinese tech companies will likely be forced to choose between access to the U.S. market and access to the Chinese market, with penalties associated with either decision.” 

 

They continued, “In the long term, the U.S. risks expediting China’s development of its own domestic semiconductor industry. China’s largest chip manufacturer, SMIC (Semiconductor Manufacturing International Corporation), is currently years behind its competitors in terms of its manufacturing technology and capacity. While China is already making moves to improve its domestic semiconductor manufacturing (as is the U.S.), U.S. technology sanctions on Russia are likely to expedite the process at the cost of the American semiconductor industry.” 

 

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Biden Administration Considers Technology Sanctions if Russia Invades Ukraine

In the months since Russia began massing troops on the border of Ukraine, the Biden administration has, on multiple occasions, warned that any further aggression by Moscow toward its neighbor would be met with unprecedented levels of sanctions. Now, the White House appears to be dropping some specific hints about what those sanctions might look like. 

 

According to multiple confirmed media reports, the administration has begun laying the groundwork for a ban on the sale of high-technology products containing U.S.-made components or software to Russia.

 

The plan echoes steps the Trump administration took against the Chinese telecommunications giant Huawei in 2020, barring vendors from selling the company semiconductors it needed to produce mobile telephone handsets. The ban had devastating consequences for Huawei’s business. Once the world leader in smartphone sales, it has fallen to 10th overall since the ban was put in place. 

 

The extent to which the administration intends to cut off Russian supplies of high-tech gear is unclear, and that’s probably intentional, experts said. 

 

“As with any sort of major event, or crisis, or potential invasion, government leaders want options … from strongest to weakest and everything in the middle, in terms of actions that can be taken,” Kevin Wolf, a former assistant secretary of Commerce for export administration in the department’s Bureau of Industry and Security, told VOA. 

 

Wolf, now a partner with the law firm Akin Gump in Washington, said that the administration is unlikely to signal exactly what action it will take unless Russia forces its hand by trying to take over more of Ukraine’s territory.

 

In 2014, in an earlier invasion, Russia took control of Crimea, a region of Ukraine, and continues to support local militias that control parts of the country’s Donbass region. 

 

Extraterritorial reach 

The U.S. appears to be considering the application of a new doctrine, the foreign direct product rule, to Russia. First put forward under the Trump administration, the rule would make it illegal under U.S. law for any entity in the world to sell high-technology equipment to Russia if that equipment was made or tested using U.S. technology. 

 

Theoretically, that could apply to virtually any product in the world that contains semiconductors, given the prevalence of U.S. technology and software involved in the devices’ manufacturing process. 

 

The rule relies on the implicit threat that companies that rely on U.S. technology or software to produce their products — even if the physical components of the products themselves originate outside the U.S. — could find themselves cut off from crucial licenses or equipment if they refuse to honor the U.S. export ban. 

 

The extreme reach of the rule, into the business dealings of non-U.S. firms, makes it politically fraught, according to Jim Lewis, senior vice president and director of the Strategic Technologies Program at the Center for Strategic and International Studies. 

 

However, speaking with VOA, Lewis said, “Using force against Ukraine really justifies it.” 

 

‘No more iPhones for Russia’ 

The U.S. has a wide range of options when it comes to blocking the transfer of technology to Russia, both in terms of the entities within Russia that the sanctions affect and the companies outside Russia that would be subject to them. (The U.S. already has export controls in place that target Russia’s defense sector, so anything the Biden administration applies would be in addition to those existing sanctions.) 

 

At the more targeted end of the spectrum, the administration could identify specific companies, making it illegal to sell U.S. technology to them. More broadly, the U.S. could impose sectorwide restrictions, barring the export of technology to, for example, the Russian civil aviation industry.

 

At the far end of the spectrum would be a flat-out ban on the sale of all U.S.-related technology to Russia.

 

“If they go for the maximum approach, that means no more iPhones for Russia,” said Lewis, of CSIS. 

 

Pushing Moscow toward China? 

If the U.S. does move forward with extensive technological sanctions against Russia, it will be difficult for Moscow to fill the gap with domestic production, said Jeffrey Edmonds, a senior analyst at the security think tank CNA. 

“Russia has always been fairly weak when it comes to things like microchips, microelectronics and electronics in general,” Edmonds told VOA. “That’s coupled with the fact that Russia has a very weak entrepreneurial system, in that most of the technology companies in that whole sector are really run by government-sponsored organizations that are highly inefficient and subject to high levels of corruption.” 

 

The result could be to push Moscow toward China, which has already been working to create a domestic manufacturing base that, in the future, might be able to provide Russia with homegrown equipment that would render U.S. sanctions ineffective. 

 

In an email exchange with VOA, research analysts Megan Hogan and Abigail Dahlman, at the Peterson Institute for International Economics, pointed out that United Nations data indicate that Russia already imports some 68% of its consumer IT products from China. 

 

“In the short term, the application of the (foreign direct product) rule will provide the Chinese government with further evidence of Western powers, particularly the U.S., meddling in Eastern affairs, validating the Chinese government’s … anti-foreign sanctions measures and further straining U.S.-China relations,” Hogan and Dahlman wrote. “Chinese tech companies will likely be forced to choose between access to the U.S. market and access to the Chinese market, with penalties associated with either decision.” 

 

They continued, “In the long term, the U.S. risks expediting China’s development of its own domestic semiconductor industry. China’s largest chip manufacturer, SMIC (Semiconductor Manufacturing International Corporation), is currently years behind its competitors in terms of its manufacturing technology and capacity. While China is already making moves to improve its domestic semiconductor manufacturing (as is the U.S.), U.S. technology sanctions on Russia are likely to expedite the process at the cost of the American semiconductor industry.” 

 

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