The Biden administration is in talks with economic powerhouses in Asia to gain their support for severe sanctions and export control packages against Russia as tensions mount over Russian troops deploying to breakaway regions in eastern Ukraine.
Washington has so far received support from Singapore, Japan, and Taiwan for plans to implement restrictive export controls on Russia, three U.S. sources tell Foreign Policy, part of a broader sanctions package aimed at crushing Russia’s economy and technology sectors should the Kremlin move forward with plans to launch a full-fledged invasion of Ukraine.
The three Asian countries are major producers of semiconductors, computer chips, and other high-end technological exports that Russia is reliant on.
These latest developments, described to Foreign Policy by three people who are familiar with the matter, demonstrate the global ripple effect of implementing massive sanctions programs targeting Moscow. The knock-on impacts of any economic reprisals against Russia would extend well beyond Europe’s borders.
The plan follows a relatively new playbook in the world of economic warfare, one that U.S. officials most recently used to target a Chinese telecommunications giant, Huawei.
The Foreign Direct Product Rule, as the policy is known, extends U.S. jurisdiction over products made with U.S. software or technology, even if those products are made abroad by foreign companies without other ties to the United States.
If implemented, it could hit many sectors of Russia’s economy in a way traditional sanctions might not—blocking Russia from importing technology critical to its oil and gas sectors; maritime, defense, and civil aviation industries; and even the import of cars, smartphones, and other consumer electronics.
“All semiconductors on the planet are made with U.S. software or tools in part, so this will catch any destined to Russia,” Kevin Wolf, a former senior Commerce Department official now at the Akin Gump law firm, told Foreign Policy in an email. “Unlike sanctions, jurisdiction attaches to the item—and the nationality of the companies involved is irrelevant.”
The embassies of Japan and Singapore and the diplomatic office of Taiwan in Washington did not respond to a request for comment. The State Department and National Security Council did not respond to requests for comment.
Russian President Vladimir Putin on Monday declared his country would recognize breakaway regions in eastern Ukraine held by Russian-backed separatists and announced the deployment of what he described as Russian peacekeepers to the so-called Donetsk and Luhansk People’s Republics.
The United States and European Union immediately condemned the move and said those involved in the decision would be sanctioned.
The White House announced on Monday it would block U.S. trade with the breakaway Ukrainian regions and prepare sanctions against people operating in those areas.
Those are separate from the sanctions package the United States is preparing should Russia launch a full-fledged invasion of Ukraine. Senior White House officials said the Biden administration would unveil more sanctions on Tuesday, spurred in part by its allies in Congress urging a harsher response.
Critics of the administration, including Republican lawmakers, argue President Joe Biden should have moved forward with tougher sanctions before Putin’s move on the breakaway Ukrainian regions.
They also characterized the initial sanctions against those separatist regions as weak and largely symbolic, given there is virtually no trade between them and the United States.
