Biden sanctions Russian tech companies, including country’s biggest chipmaker

A new round of sanctions was imposed by the Biden administration on Russia, with a focus on technology companies that support the Russian war effort in Ukraine. The largest chipmaker in Russia is among the companies that have been blacklisted.

The Treasury Secretary said in the press release that they would continue to target the war machine of Putin.

Many of the chips used by Mikron are used in identification cards. The company makes power management chips. In addition to supplying technology for Russian military operations, the US says Mikron is responsible for a majority of Russia's chip exports. Russia needs hard currency to pay for imports and hobbling the company could help starve it.

NII-Vektor works on Russian satellites. T-Platforms makes original computing equipment for the mass information technology market.

The Treasury Department stated that sanctions can be imposed on any individual or entity that is determined to operate or have operated in any of the sectors.

The Russian government is trying to evade the sanctions by setting up front companies. The US released a list of 21 entities that it believed were acting as fronts for Russian companies or the Russian government.

Russia's technology sector has been affected by war-related sanctions. An article this week stated that Russia's version of Google has had to cut ties with Western companies. The sanctions will make it difficult for Yandex to get enough hardware. The market value of the company has fallen from over $30 billion to under $6 billion.

According to the Associated Press, as many as 70,000 Russian technology workers have left Russia since the beginning of the invasion of Ukraine. Putin reacted to the exodus of tech professionals by approving legislation to eliminate income taxes between now and 2024 for individuals who work for information technology companies.

The head of a Russian trade group warned that as many as 100,000 more tech workers might leave the country in April if conditions don't improve.

Tim Lee worked at Ars for three years. Full Stack Economics is an email newsletter about the economy, technology, and public policy. You can subscribe to his newsletter here.