Chinese IT companies are “quietly pulling back from doing business in Russia under pressure from US sanctions and suppliers,” despite calls by Beijing for companies to resist overseas pressure, WSJ reports.
Several major companies are decreasing shipments to Russia, including PC giant Lenovo and smartphone and gadget maker Xiaomi.
These two companies have actually stopped deliveries to Russia, even though they refrained from making public statements about the war or their gradual withdrawal from Russia.China’s exports to Russia in March as a whole fell by 27% compared to February, with supply of laptops decreasing by more than 40%, smartphones — by two thirds, base stations – by 98%, according to data from the Chinese customs cited by WSJ.
The Chinese are under pressure from American suppliers of semiconductors, who are prohibited by sanctions from selling products to Russia. The Chinese cannot refuse, and they “can be understood,” says Steve Brazier, CEO of technology research firm Canalys: the loss of chips from the United States “will be a disaster for them.”
In late March, Huawei stopped concluding new contracts for the supply of network equipment and gadgets to Russia, and in April sent employees of the local office on vacation. The company, which accounts for 30-40% of all base stations operating in the Russian Federation, “was almost the first to suspend orders after the sanctions.”
More recently, UnionPay refused to work with the sanctioned banks. Sber, VTB, Otkritie and Alfa-Bank were refused to issue cards that could become the last “window” into the world for their customers.
Total exports from China to Russia in March amounted to just $3.8 billion, down 30%-50% from the previous months, according to official statistics.
Problems with payments are one of the reasons, a banker from a large Russian state bank points out: Chinese banks are not inclined to ignore American and European sanctions because they are afraid of falling under secondary measures.
Sources: WSJ, The Moscow Times
