Due to tensions between Russia and Ukraine, South Korea is threatened with export restrictions

Due to tensions between Russia and Ukraine, South Korea is threatened with export restrictions

South Korea - Rising geopolitical tensions between Russia and Ukraine have caught South Korea's attention.

South Korea is wary of export restrictions to Russia, imposed by the United States. The White House National Security Council has asked the semiconductor industry association, a chip lobby group in the United States (US) to prepare for possible action against Russia if it attacks Ukraine.

Joe Biden's government may curb Russia's access to global consumer electronics using US chips and order technology companies to shut down exports to Russia immediately. This is in line with the consideration of the US Commerce Department which reportedly banned the export of mobile phones, laptops, computers, refrigerators, and washing machines to Russia.

Some of these products have US chips or software and are made by non-US manufacturers, including South Korea. Brands Samsung and LG could be subject to US sanctions given that they not only sell but also manufacture electronics. Samsung and LG strongly dominate the Russian television market.

Samsung is also considered one of the leading brands in the Russian smartphone market, apart from the iPhone and Xiaomi. Samsung runs a TV factory in Kaluga, a city 160 km southwest of Moscow.

The Samsung factory meets local demand for TV sets with a capacity of 3 million per year. Meanwhile, LG operates in Ruza, Greater Moscow. However, experts say it is too early to be afraid of the impact of the conflict. Russia recently deployed 100,000 troops along the Ukrainian border.

Han Tae-hee, a professor of semiconductor systems engineering at Sungkyunkwan University in Seoul, said restraint might be one of the options being considered regardless of how intense the geopolitical conflict is.

"It is unrealistic to say that the US can actually take action, given Europe's dependence on Russia in terms of natural gas supplies as well as Russia's military power," he was quoted as saying by Zonajakarta.com from The Korea Herald.

A Samsung spokesman said if the export restrictions materialized it would have little impact on the company. A spokesman for LG said it was closely monitoring developments surrounding the Russia-Ukraine conflict.

"Some Korean consumer electronics use US chips," said Noh Geun-chang, senior analyst at Hyundai Motor Securities. "Chips for artificial satellites or aerospace technology are likely to be subject to export restrictions," he added

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