UK suppliers send $150m of key equipment to the Russians

Despite a dramatic curtailment in trade between the two countries since the invasion of Ukraine, British technology, including drones, is still finding its way to Russia’s military.

A Russian soldier patrols at the Mariupol drama theatre, hit by an air strike in 2022. British technology is still finding its way to Russia’s military nearly two years after the full-scale invasion of Ukraine began. Picture: AFP

British suppliers exported critical components, including semiconductors and drones, worth more than $150 million to Russia in the first ten months of last year. About $23 million worth of the goods were supplied to Russia directly from UK warehouses.

The figures represent a dramatic curtailment in trade between Russia and the UK compared with 2022 when critical components worth about $107 million were exported. But British technology is still finding its way to Russia’s military, often indirectly through third parties, nearly two years after the full-scale invasion of Ukraine began.

The figures were produced by the Kyiv School of Economics and the Yermak-McFaul international working group on Russian sanctions, which based its research on dismantled Russian weapons found in Ukraine, including a Kinzhal hypersonic missile, and data from other sources.

Overall, 28 components of UK origin were found in Russian weapons, compared with more than 2,000 of American origin. Many of the components, while not necessarily covered by sanctions, are essential for Russian weapons and cannot be produced by the country.

A Ukrainian drone hunting team show the media a part of an allegedly downed Russian drone, in the outskirts of Kyiv, on November 30, 2023, Picture: AFP

The European Commission, along with the United States, the UK and Japan, produces a list of common high- priority items that, while not necessarily sanctioned, are critical to the Russian military. The Kyiv School of Economics uses a similar list, identifying components in the automotive, computer and navigation sectors, among others, that are also used by Russia.

Most of the UK goods supplied to Russia were semiconductor and computer components but about $2.3 million worth of “computer numerical control” (CNC) machines produced in the UK also found their way to Russia last year. The high-precision devices are particularly useful for defence manufacturing and have become a major concern for Ukraine’s allies.

In November the US imposed sweeping sanctions on all significant Russian importers of CNC tools, including some that had moved less than $300,000 of equipment since the full-scale invasion in February 2022.

Other companies also increased their exposure to Russia last year, either through more exports from the UK or from overseas production facilities.

They include FTDI, a UK semiconductor manufacturer that The Times revealed had produced chips that were found in an abandoned Russian tank in Brovary, about 19 kilometres northeast of Kyiv, in March 2022, just weeks after the invasion began. About $2.3 million of FTDI components were imported into Russia last year, compared with $770,000 in 2022. Fred Dart, FTDI’s founder, said: “We take seriously any reports relating to the supply of our products into Russia. We are highly confident that none of FTDI’s products have been supplied into Russia in breach of any applicable sanctions and FTDI does not support any use of our products to violate human rights. As we have previously stated, FTDI continues to adhere to applicable UK government sanctions and export control laws and our future business plans take those restrictions into account.”

Ukrainian servicemen work on a tank abandoned by Russian troops during their retreat in the north of the Kharkiv region. Chips made by a UK semiconductor manufacturer were found in a tank abandoned near Kyiv. Picture: AFP

Many products made or designed in the UK find their way indirectly to Russia, often via Chinese, Hong Kong and Turkish firms. Of the 15 biggest foreign suppliers of UK critical items to Russia, three have been sanctioned by the US. However, there are also several UK-based suppliers that have shipped millions of dollars of components directly to Russia.

Mykines, a British business registered to a terrace house in Enfield, north London, has arranged the sale of about $1.8 billion of electronics into Russia since President Putin’s invasion of Ukraine, according to the Financial Times. The business exported $56 million in critical components to Russia in the first ten months of last year, according to the KSE Institute at the Kyiv School of Economics.

Machinery Trading & Service, a UK supplier of parts for the mining and building industry, supplied equipment worth $15.7 million to Russia, the second-highest value of any UK supplier. The business appears to have been transferred to a Ukrainian living in Moldova, Iryna Voronina, just a couple of months after the war in Ukraine began. Mykines and Machine Trading Service were approached for comment.

Olena Bilousova, senior research lead at the KSE Institute, said: “Despite having seen a positive shift in reducing direct trade with Russia, the total figure remains substantial, at $171 million. Indirect trade by British companies has surged by 78 per cent in monetary terms in the tenth month of 2023 compared to the same period in 2022.

“While sanctions enforcement has not yet reached maximum effectiveness, and practices [and] procedures are being developed at the national level, companies need to not only follow existing rules but also honestly work on strengthening their compliance systems to better manage the flow of their goods.”

The UK government said: “We have implemented the most severe package of economic sanctions ever imposed on a major economy. We also recently announced the creation of a new Office of Trade Sanctions Implementation to strengthen our enforcement of sanctions. Any non-compliance with these tough sanctions is a serious offence.”

The Times