We Wanted to Beat Them One-by-One: Some Chinese Exports Help Russian Military

BEIJING -- Chinese exports to Russia of microchips and other electronic components and raw materials, some with military applications, have increased since Russia was sanctioned in February, complicating efforts by the U.S. and Western allies to isolate the country's economy and cripple its military.

Chip shipments from China to Russia more than doubled to about $50 million in the first five months of 2022 compared with a year earlier, Chinese customs data show, while exports of other components such as printed circuits had double-digit percentage growth. Export volumes of aluminum oxide, which is used to make the metal aluminum, an important material in weapons production and aerospace, are 400 times higher than last year.

The rise in reported export values may partly be explained by inflation. But the data shows that many Chinese tech sellers have continued to do business with Russia despite U.S. scrutiny.

The Chinese exports, while just a sliver of the country's overall exports, are a source of concern for U.S. officials. The Commerce Department added five Chinese electronics companies to a trade blacklist last month for allegedly helping Russia's defense industry.

"Our government and our national leadership has been very clear from February 24th on that China should not provide material, economic and military support for Russia," Nicholas Burns, the U.S. ambassador to China, said last week.

The Commerce Department said in a written response that while it didn't believe China had sought to systematically evade U.S. export controls on Russia, the department was closely monitoring trade between the countries and "will not hesitate to employ our full legal and regulatory tools against parties that provide support to the Russian military."

The China-Russia trade in chips and other components with potential military applications involves both small, private outfits and sprawling state-owned enterprises. Incomplete data and complex networks of subsidiaries and middlemen make it hard to trace all the activity.

Chinese officials have said the country isn't selling weapons to Russia. And overall exports from China to Russia have fallen this year as many Chinese companies fear running afoul of the U.S.

China's support, broadly speaking, is critical to Moscow. Oil and gas revenues make up a sizable chunk of Russia's economy. As European nations such as Germany seek to draw down Russian energy purchases, Russian President Vladimir Putin has stressed the importance of selling far more energy to China and others in Asia in the future.

China is also gaining leverage in its relationship with Russia. While China historically has relied on Russia, and before that the Soviet Union, for many advanced technologies, that is gradually changing as China closes the technology gap and emerges as a defense exporter in its own right.

Chinese leader Xi Jinping has repeatedly reaffirmed Beijing's support for Russia, saying the two countries share a friendship with "no limits."

A shared dissatisfaction with the U.S.-led post-World War II international system has gradually driven the countries together during Mr. Xi's decade in power, despite a long history of strategic mistrust.

Researchers at C4ADS, a Washington-based nonprofit organization that tracks security threats, have been looking at trade between Russian defense firms and China Poly Group, a conglomerate controlled by China's central government. Poly's subsidiaries include a key Chinese weapons producer and exporter of small arms, missile technology and, more recently, antidrone laser technology.

Between 2014 and January 2022, C4ADS researcher Naomi Garcia identified 281 previously undisclosed shipments of so-called dual-use goods, which have both civilian and military uses, from Poly subsidiaries to Russian defense organizations, she wrote in a report released on Friday.

In one of the most recent shipments, in late January, according to the research, Poly Technologies sent antenna parts to sanctioned Russian defense company Almaz-Antey. Ms. Garcia said she hasn't discovered Poly shipments to Russian defense firms since late February.

Russian customs records reviewed by C4ADS say the antenna parts were specifically to be used in a radar that is part of Russia's advanced S-400 surface-to-air missile system.

"Poly Technologies is undeniably facilitating the Russian government's acquisition of missile-system parts," Ms. Garcia said.

Poly Technologies was sanctioned by the State Department in January for engaging in proliferation of missile technologies. A State Department spokesperson said the sanctions were related to the company's transferring of ballistic-missile technology to another country, but didn't name which country.

Poly didn't reply to a faxed request for comment and an official in its press office hung up when asked about its work with Russia. Almaz-Antey, Russia's Ministry of Economic Development and Ministry of Industry and Trade, didn't respond to a request for comment.

Beyond radar components and semiconductors, Chinese exporters also have helped fill a gap in basic materials that Russia is restricted from sourcing elsewhere.

In March, Australia prohibited the export of aluminum oxide and several other related products, citing their use in weapons development. Since then, Chinese exports of aluminum oxide to Russia have surged, hitting 153,000 metric tons in May, according to Chinese customs records, compared with 227 metric tons a year earlier.

Unlike state-owned conglomerate Poly, the Chinese companies that were blacklisted most recently by the Commerce Department are small, private hardware distributors run out of Hong Kong and China's southern province of Guangdong.

Maria Shagina, an expert on Russia sanctions at the International Institute for Strategic Studies in Berlin, said the latest action against the Chinese companies appeared to be intended to show that U.S. threats were credible, particularly considering how smaller companies may be better able to circumvent export controls than bigger ones.” [1]

1. Some Chinese Exports Help Russian Military
Spegele, Brian. 
Wall Street Journal, Eastern edition; New York, N.Y. [New York, N.Y]. 16 July 2022: A.1.

Oi, ateina didelė recesija, nes vėl persistengėme su sankcijomis: G20 finansų ministrams nepavyko susitarti dėl Rusijos naftos kainos ribojimo

„20 išsivysčiusių šalių grupės finansų ministrai šeštadienį baigė savo susitikimą Indonezijoje nesutarę dėl JAV pasiūlymo apriboti Rusijos naftos kainą.

 

    JAV iždo sekretorė Janet Yellen atvyko į susirinkimą, kad sustiprintų paramą nepilnam planui. Ji sakė, kad pasiūlymas galėtų būti galinga priemonė, siekiant sušvelninti ekonomines sankcijų Rusijai pasekmes ir apriboti Rusijos galimybes pasipelnyti iš sparčiai didėjančių energijos sąnaudų. Septynių Vakarų valstybių grupės lyderiai praėjusį mėnesį iš esmės susitarė svarstyti planą sumažinti pasaulines naftos kainas įvedant nuolaidą Rusijos naftai, tačiau detalės, kaip toks mechanizmas veiks, lieka neaiškios.

 

    Iždo departamento pranešime teigiama, kad renginio kuluaruose vykusiuose susitikimuose ponia Yellen „pabrėžė bendradarbiavimo svarbą nustatant Rusijos naftos kainų viršutinę ribą, siekiant apriboti pajamas Rusijai ir apriboti sankcijų Rusijai poveikį energetikos kainoms“.

 

    Kai kurių šalių, įskaitant Indiją ir Kiniją, parama arba nesikišimas šio didesnio susitikimo Indonezijoje metu būtų labai svarbus planui pasiekti numatytą poveikį.

 

    Ponia Yellen ir kai kurie kiti ministrai susitikime suvertė kaltę dėl pasaulinio maisto trūkumo ir kylančių energijos kainų tiesiogiai Rusijai. Ukrainos finansų ministras Serhijus Marčenko savo kolegoms virtualioje kalboje sakė, kad sankcijos Rusijai „jau apsunkino, nestabilų ir neramesnį gyvenimą beveik kiekvienoje iš jūsų šalių“.

 

    Praėjusią savaitę vykęs 20 užsienio reikalų ministrų grupės susitikimas taip pat baigėsi be įprasto komunikato, kai iš susirinkusiųjų tarpo pasišalino Rusijos užsienio reikalų ministras Sergejus V. Lavrovas. Finansų ministrų susitikime dalyvavo ir Rusijos atstovai.

 

    Jungtinės Valstijos įvedė draudimą nedideliam Rusijos naftos kiekiui, kurį jos importuoja. Didesnis Rusijos naftos tiekimo šokas įvyks metų pabaigoje, kai tikimasi, kad Europos Sąjunga laipsniškai įves panašų draudimą, kartu su draudimu draudėjams teikti draudimą laivams, gabenantiems Rusijos naftą visame pasaulyje.

 

    Kainos viršutinė riba sudarytų draudimo sankcijų išimtį ir leistų rusišką naftą parduoti su didelėmis nuolaidomis šalims, kurios neįvedė embargo.

 

    Jungtinės Valstijos baiminasi, kad, įsigaliojus Europos draudimui, didelio kiekio naftos pašalinimas iš pasaulinės rinkos gali smogti pasaulio ekonomikai.

 

    Analitikai apskaičiavo, kad dėl tokio pasiūlos išsekimo naftos kainos gali siekti 200 dolerių už barelį ar daugiau, o tai reiškia, kad amerikiečiai už benziną mokės 7 dolerių už galoną. Pasaulinis augimas gali katastrofiškai smukti, nes vartotojai ir įmonės sumažins išlaidas, reaguodami į aukštesnes degalų kainas, o centriniai bankai jau dabar kelia palūkanų normas, siekdami sutramdyti infliaciją ir dar labiau padidinti skolinimosi išlaidas."

 

Oops, here comes the Great Recession because we went overboard with sanctions again: G20 finance ministers fail to reach an agreement to cap the price of Russian oil.

"Finance ministers from the Group of 20 industrialized nations ended their meeting in Indonesia on Saturday without an agreement on a U.S. proposal to cap the price of Russian oil.

U.S. Treasury Secretary Janet Yellen had gone to the gathering to solidify support for the incomplete plan. She said the proposal could be a powerful tool to mitigate the economic fallout of the sanctions on Russia and curtail Russia’s ability to profit from soaring energy costs. The leaders of the Group of 7 nations had agreed last month in principle to consider the plan to tamp down global oil prices by imposing a discount on Russian oil, but the details of how such a mechanism would work remains unclear.

The Treasury Department said in a statement that in meetings on the sidelines of the event, Ms. Yellen “highlighted the importance of cooperation on a price cap on Russian oil in order to restrict revenue to Russia and limit the impact of sanctions on Russia on energy prices.”

The support, or noninterference of, some of the countries at the larger meeting in Indonesia, including India and China, would be instrumental in the plan having its intended effect.

Ms. Yellen and other ministers at the meeting placed the blame for global food insecurity and spiraling energy prices squarely on Russia. Ukraine’s finance minister, Serhiy Marchenko, told his counterparts in a virtual address that sanctions on Russia had “already made life in almost every one of your countries more difficult, more unstable and turbulent.”

Last week’s meeting of the Group of 20 foreign ministers also ended without a customary communiqué, after Russia’s foreign minister, Sergey V. Lavrov, walked out of the gathering. Russian representatives also attended the finance ministers’ meeting.

The United States has imposed a ban on the small amount of Russian oil that it imports. A bigger shock to Russian oil supply will occur at the end of the year, when the European Union is expected to phase in a similar ban, coupled with a prohibition on insurers providing coverage to ships that transport Russian oil around the world.

The price cap would create an exception to the insurance sanctions, allowing Russian oil to be sold at deep discounts to countries that have not put embargoes in place.

The United States is fearful that once the European ban takes effect, the removal of large quantities of oil from the global market could deal a severe blow to the world economy.

Analysts have calculated that such a depletion in supply could send oil prices to $200 a barrel or more, translating to Americans paying $7 a gallon for gasoline. Global growth could slam into reverse as consumers and businesses pull back spending in response to higher fuel prices and central banks, which are already raising interest rates in an effort to tame inflation, increasing borrowing costs even more."

Kodėl Lietuvos valdančiųjų elgesys branduolinių galių konfrontacijoje yra idiotiškas: baimė, kurios JAV lyderiai neturėtų bandyti įveikti

  „Rašinyje „Vakarams reikia ginklavimosi lenktynių“ (pranešimas, liepos 7 d.) Julija Latynina rašo: „Vakarai turi sukurti tikslius ginklus, galinčius išnaikinti Rusijos branduolines šachtas – ir leisti ponui Putinui suprasti, kad Vakarai nebijo juos panaudoti." 

 

Tačiau yra rimta priežastis baimintis dėl tokio veiksmo: Rusijos branduolinės pajėgos, kaip ir Amerikos, nėra vien tik šachtose. Bet koks bandymas nusitaikyti į Rusijos šachtas, net ir sėkmingas, išlaisvintų šimtus, jei ne tūkstančius branduolinių ginklų, nukreiptų prieš Ameriką (ir Lietuvą (K.)).

 

     JAV nerodo silpnumo, kai svarsto apie Rusijos branduolinius ginklus. Tai susiję su faktais, nepaisant to, ar tie faktai mums patinka.

Jackas Lecheltas

Leesburg, Va." [1]

1. A Fear That U.S. Leaders Should Not Try to Overcome
Wall Street Journal, Eastern edition; New York, N.Y. [New York, N.Y]. 13 July 2022: A.16.

Why Actions of Lithuanian Leaders in Confrontation of Nuclear Powers Are Idiotic: A Fear That U.S. Leaders Should Not Try to Overcome

"In "The West Needs an Arms Race" (op-ed, July 7), Yulia Latynina writes, "The West must build precision weapons that can take out Russia's nuclear silos -- and let Mr. Putin know that they aren't afraid to use them." But there's good reason to fear such an action: Russia's nuclear forces, like America's, are not solely placed in silos. Any attempt to target Russian silos, even if successful, would unleash hundreds, if not thousands, of nuclear weapons at America (and at Lithuania (K.)).

The U.S. isn't displaying weakness when it considers Russia's nukes. It is dealing with the facts, regardless of whether we like those facts.

Jack Lechelt

Leesburg, Va." [1]

1. A Fear That U.S. Leaders Should Not Try to Overcome
Wall Street Journal, Eastern edition; New York, N.Y. [New York, N.Y]. 13 July 2022: A.16.

„Microsoft“ atakuoja, gindamasis nuo kaltinimų monopolistiniu elgesiu debesijos srityje

„Microsoft Corp. pradėjo kampaniją Europoje, siekdama sukurti sąjungininkus ir nuginkluoti kritikus, nes vienoje didžiausių jos rinkų priežiūros institucijos jai skiria daugiau dėmesio.

 

    Konkurentai kaltina programinės įrangos gigantą, piktnaudžiaujant savo, kaip antros pagal dydį debesų kompanijos pasaulyje po Amazon.com Inc., padėtimi, siekiant aplenkti Europos įmones. „Microsoft“ į tai atsako, naudodamas privilegijas ir įtikinėjimą, o kai kuriais atvejais stengiasi siekti tikros pažangos.

 

    Vokietijos debesų kompiuterijos bendrovei „Nextcloud GmbH“ pateikus antimonopolinį skundą prieš „Microsoft“ Europos Komisijai, JAV milžinės „Nextcloud“ advokatas buvo pateikęs pasiūlymą, sakė „Nextcloud GmbH“ generalinis direktorius Frankas Karlitschekas.

 

    „Nextcloud“ apkaltino „Microsoft“ konkurencijos slopinimu, verčiant klientus naudoti konkuruojančią debesų programinę įrangą, susiejant ją su „Windows“ operacine sistema.

 

    Vokietijos bendrovė taip pat sudarė Europos įmonių konsorciumą, susirūpinusį „Microsoft“. „Microsoft“ teisininkas paklausė „Nextcloud“, ar įmonės galėtų kaip nors bendradarbiauti ir pasiūlė naudą, įskaitant „Nextcloud“ logotipo reklamavimą „Microsoft“ rinkodaros medžiagoje, jei Vokietijos įmonė atsisakytų skundų, sakė p. Karlitschekas.

 

    Uvertiūra nepavyko. p. Karlitschekas atsisakė.

 

    „Jis iš esmės mums siūlė sausainį“, – sakė jis. "Tai ne apie logotipo turėjimą kažkur ar greitą sandorį. Mums tai neįdomu. Esame susirūpinę dėl bendros antimonopolinės padėties."

 

    „Microsoft“ prezidentas Bradas Smithas teigė, kad bendrovė tik bando įsiklausyti į Europos įmonių nerimą keliančias problemas ir jas spręsti.

 

    „Negalite tapti sąjungininkais, kol nenustojate būti priešininkais, ir negalite nustoti būti priešininkais, kol neišspręsime susirūpinimo, kurį jie teisėtai iškėlė“, – sakė ponas Smithas.

 

    Europos Sąjunga atsidūrė pasaulinės milžiniškų technologijų įmonių kontrolės bangos priešakyje, įskaitant tai, kaip jos konkuruoja ir kaip tvarko duomenis. „Microsoft“ ir plačiau debesų kompiuterijos verslas nebuvo pagrindiniai naujųjų taisyklių tikslai. 

 

Bendrovės lobizmas žymi naują svarbią kovą tarp vyriausybių ir technologijų įmonių.

 

    Nors „Microsoft“ neturi didžiausios debesų rinkos dalies, jos debesų verslas sulaukia dėmesio Europoje, iš dalies dėl konkurentų teiginių, kad ji naudojasi savo dominavimu su „Windows“ operacine sistema ir „Office“ produktyvumo programomis, kad suteiktų jai nesąžiningą pranašumą, skatinant klientus naudotis kitomis debesijos paslaugomis.

 

    Kai kurie lobistai Europoje taip pat gali turėti įtakos tam, kaip reguliuotojai žiūri į „Microsoft“, kai jie svarsto, ar patvirtinti 75 mlrd. dolerių vertės vaizdo žaidimų bendrovės „Activision Blizzard Inc.“ sandorį. Daugelyje rinkų bendrovei reikalingas reguliavimo patvirtinimas, o tai gali turėti įtakos bet kokie antimonopoliniai pareiškimai. Didžiosios Britanijos antimonopolinė reguliavimo institucija praėjusią savaitę pradėjo tyrimą, ar perėmimas gali sumažinti konkurenciją.

 

    Ponas Smithas sakė, kad „Activision“ įsigijimas yra viena iš priežasčių, nulėmusių Europos žavesio puolimą. „Turime išlaikyti visuomenės pasitikėjimą, kad augsime atsakingai“, – sakė jis.

 

    Europos įstatymų leidėjai praėjusią savaitę patvirtino plačias skaitmenines taisykles, kurios nustatys konkurencijos taisykles kelioms didelėms JAV įmonėms, įskaitant „Microsoft“. 

 

Kitas svarstomas ES reglamentas galėtų paskatinti debesijos paslaugų teikėjus, kad klientai galėtų lengviau perkelti duomenis iš vienos platformos į kitą.

 

    Pagrindiniai „Microsoft“ debesų konkurentai – „Amazon“ ir „Alphabet Inc.“ „Google“ – taip pat susiduria su reguliavimo priešpriešiniais vėjais Europoje. Skirtingai nei „Microsoft“ pastaraisiais metais, abi bendrovės buvo apkaltintos tariamais antimonopoliniais pažeidimais, susijusiais su jų ne debesų verslu.

 

    Susipažinimas su reguliavimo institucijomis, konkurentais ir kitomis suinteresuotosiomis šalimis yra daugelio pagrindinių technologijų įmonių verslo dalis. „Microsoft“ sprendė naujausius iššūkius Europoje taip pat, kaip tvarko JAV reglamentus – iš anksto susisiekė su politikos formuotojais ir kartais bendradarbiauja su kritikais.

 

    Nors „Microsoft“ neskirsto pardavimų pagal geografiją, analitikas Bradas Rebackas iš „Stifel Financial Corp.“ apskaičiavo, kad „Microsoft“ apie 35 % pardavimų uždirba iš Europos regiono.

 

    „Microsoft“ eskalavimas Europoje sukėlė problemų kai kurioms įmonėms. Praėjusių metų pabaigoje „Microsoft“ sudarė sutartį su viešųjų ryšių milžine „Burson Cohn & Wolfe“, kad atliktų papildomus darbus Europoje. „Slack Technologies LLC“ bendradarbiavo su įmone, siekdama paremti jos pačios bandymus kovoti su „Microsoft“ Europoje, pateikdama 2020 m. antimonopolinį pareiškimą. Po to, kai „Microsoft“ pasamdė BCW papildomam darbui, įmonė atsisakė „Slack“, kaip kliento dėl interesų konflikto ir supykdė „Slack“ vadovus, sakė žmonės, susipažinę su „Slack“ pastangomis Europoje.

 

    BCW atstovė sakė, kad verslo konfliktai gali kilti, keičiantis jos klientų tikslams.

 

    Nepaisant pastangų, „Microsoft“ ir toliau susiduria su pasipriešinimu.

 

    Praėjusią vasarą prancūzų firma OVHcloud ir kitos  Europos bendrovės pateikė skundą prieš „Microsoft“, teigdamos, kad produktų licencijavimo būdas stumia vartotojus link „Microsoft“ Azure debesies.

 

     Europos Komisijos atstovė sakė gavusi skundų prieš „Microsoft“ ir juos nagrinėja.“ [1]

1. Microsoft on Offensive Over Cloud Scrutiny
Tilley, Aaron; Kim Mackrael. 
Wall Street Journal, Eastern edition; New York, N.Y. [New York, N.Y]. 13 July 2022: B.1.

Microsoft on Offensive Over Cloud Scrutiny

"Microsoft Corp. has embarked on a campaign in Europe to create allies and disarm critics as it comes under greater scrutiny in one of its largest markets.

Competitors accuse the software giant of abusing its position as the world's second-largest cloud company after Amazon.com Inc. to outflank European companies. Microsoft is responding with a mixture of perks and persuasion -- and in some cases struggling to make headway.

After German cloud-computing company Nextcloud GmbH filed an antitrust complaint against Microsoft with the European Commission, a lawyer for the U.S. giant called Nextcloud with an offer, said its chief executive, Frank Karlitschek.

Nextcloud had accused Microsoft of suppressing competition by pushing customers to use its rival cloud software by bundling it with its Windows operating system.

The German company had also formed a consortium of European companies concerned about Microsoft. The Microsoft lawyer asked Nextcloud if the companies could work together in some way, offering benefits -- including promoting Nextcloud's logo in Microsoft's marketing material -- if the German company dropped the complaints, said Mr. Karlitschek.

The overture didn't succeed. Mr. Karlitschek refused.

"He was basically offering us a cookie," he said. "It isn't about having a logo somewhere or doing a quick deal. We're not interested in that. We are concerned about the overall antitrust situation."

Microsoft President Brad Smith said the company is just attempting to listen to and address issues European companies are worried about.

"You can't become allies until you stop being adversaries, and can't stop being adversaries until we address the concerns that they legitimately have raised," Mr. Smith said.

The European Union has been at the forefront of a global wave of increased scrutiny of giant technology companies, including how they compete and how they handle data. Microsoft and more broadly the cloud-computing business haven't been the top targets for the new regulations. The company's lobbying marks an important new front in the emerging battle between governments and tech companies.

Even though Microsoft doesn't have the largest cloud market share, its cloud business is getting attention in Europe, in part because of rivals' claims that it is using its dominance with its Windows operating system and Office productivity apps to give it an unfair edge in pushing customers to use its other cloud services.

Its interactions on cloud concerns could also impact how regulators see Microsoft when they consider whether to approve its $75 billion deal for videogaming company Activision Blizzard Inc., some lobbyists in Europe said. The company needs regulatory approval in many markets, a process that could be impacted by any antitrust claims. Britain's antitrust regulator last week opened a probe into whether the takeover might reduce competition.

Mr. Smith said the Activision acquisition is one of the reasons behind its European charm offensive. "We have to sustain public confidence that we will grow in a responsible way," he said.

European lawmakers last week approved sweeping digital regulations that will impose competition rules on several large U.S.-based companies including Microsoft. Another EU regulation under consideration could push cloud providers to make it easier for customers to move data from one platform to another.

Microsoft's main cloud rivals -- Amazon and Alphabet Inc.'s Google -- also face regulatory headwinds in Europe. Unlike Microsoft in recent years, both companies have been charged with alleged antitrust violations related to their non-cloud businesses.

Getting to know regulators, competitors and other stakeholders is part of doing business for most major tech companies. Microsoft has dealt with the most recent challenges in Europe the same way it handles regulations in the U.S. -- pre-emptively reaching out to policy makers and sometimes co-opting critics.

While Microsoft doesn't break out sales by geography, analyst Brad Reback of Stifel Financial Corp. estimates Microsoft earns around 35% of its sales from the European region.

Microsoft's escalation in Europe has created problems for some companies. Late last year, Microsoft contracted public relations giant Burson Cohn & Wolfe to do additional work in Europe. Slack Technologies LLC had been working with the firm to back its own attempts to fight Microsoft in Europe through a 2020 antitrust filing. After Microsoft hired BCW for the additional work, the firm dropped Slack as a client due to a conflict of interest, infuriating Slack executives, said people familiar with Slack's efforts in Europe.

A BCW spokeswoman said business conflicts may emerge as its clients' goals change.

Despite its efforts, Microsoft continues to face resistance.

Last summer, French firm OVHcloud and other European companies filed a complaint against Microsoft, saying the way it licenses products pushes users toward Microsoft's Azure cloud.

A spokeswoman for the European Commission said it had received complaints against Microsoft and is assessing them." [1]

1. Microsoft on Offensive Over Cloud Scrutiny
Tilley, Aaron; Kim Mackrael. 
Wall Street Journal, Eastern edition; New York, N.Y. [New York, N.Y]. 13 July 2022: B.1.