The Russian president said that Russia is facing a serious crisis in the tech industry. International sanctions weigh on this sector in the country, which is very dependent on the West in its demand for components.
Vladimir Putin cannot hide it, Russia has to deal with problems” colossal in the high-tech industry. The Russian head of state gave a speech on July 18, 2022, duringa meeting of the presidential council where he discussed the consequences of international sanctions. ” This is a huge challenge for our country the autocrat said, accusing Western countries of deliberately blocking Russia’s access to high-tech products.
” Realizing the colossal amount of difficulties we face, we are looking for new solutions. It is clear that we cannot develop in isolation from the whole world, but that will not be the case – it is impossible to erect huge barriers in the modern world. added the Russian president.
The European Union, the United States and Japan have imposed severe economic and diplomatic sanctions on Russia following its invasion of Ukraine on February 24. The West aims to stifle the military-industrial sector by limiting access to advanced technologies and essential components, such as microprocessors. Tech giants have also joined the movement, like Apple, Microsoft, Intel, Samsung and Qualcomm, which have each suspended their activities in Russia, or even left the country, leaving local companies without any national alternative.
A brain drain
The Kremlin relies on China for its tech supplies, but Beijing must first manage a global microchip supply crisis. Thus, telecom groups and cloud companies are the first victims of sanctions against Russia, recalls the British media the Financial Times. The European Union collectively accounts for more than half of Russia’s imports of high-tech goods, mostly in the aerospace and biotechnology sector, which are also suffering according to Think Tank Bruegel.
Another concern for Vladimir Putin is the brain drain. Between 50,000 and 70,000 Russian IT professionals left the country as early as March, according to the Russian Electronic Communications Association. The director of the association, Sergey Plugotarenko, explains that this exodus is due to the fact that Russian tech workers have lost access to the platforms on which they earn their living. 100,000additional technicians could leave the country, he adds.
The Kremlin is betting on food and energy blackmail to get out of these sanctions, by blocking Ukrainian ports intended to deliver wheat or slowing down the sending of gas to the most dependent European countries.
The Institute of International Finance said last month that Russia’s economy would shrink by 15% this year under Western sanctions, erasing 15 years of economic gains.
