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Crisis in technology due to the war in Ukraine

Una de las consecuencias de la guerra en Ucrania es la potencial crisis in technology que esta puede causar. Aunque no lo parezca, este conflicto puede cambiar por completo la world geopolitics. Esto debido al impacto que tiene en el mercado de las materias primas.

Desde que comenzó la guerra, más de 7,7 millones de personas se han visto en la obligación de buscar shelter en otros países de Europa. Mientras que 6,2 millones de ucranianos se han desplazado a otras zonas del país.

On the other hand, since Ukraine is responsible for producing 15% of the world's corn and 10% of the wheat, the blockade of its exports is generating a world food crisis que se acentúa a medida que pasa el tiempo.

However, until now very little has been said about the impact of the war on the technology industry a nivel global. A continuación, veremos los cambios que se están produciendo y cómo estos pueden cambiar el mapa tecnológico mundial a largo plazo.

Why the war in Ukraine can cause a crisis in technology?

The war in Ukraine has the potential to cause a crisis in technology a nivel mundial. Principalmente por el impacto que tiene en la distribución de algunas materias primas que son strategic for the industry.

It is no secret that, for years, countries like the US, China and Russia have been competing with each other to become the main technological power of the world. However, in order to achieve this, these countries need to secure their supply chain.

Si tomamos en cuenta que antes del conflicto Ucrania era el proveedor del 40% y Rusia del 30% de la producción mundial de litio, níquel y gas neón; podemos darnos cuenta de la importancia que tienen ambas regiones para la industria de los semiconductor and chip manufacturing.

Con ambos países envueltos en una guerra, una baja en la producción de la materia prima puede abrir las puertas a nuevos productores como China; y así convertirla en the largest supplier worldwide of these components.

Aumento de tensiones entre Taiwán y China

If we add to this the increase in tensions between Taiwan and China, the picture does not look good for Western countries. Some analysts say that China will have the capacity to triple the production of technological minerals in all of Europe and double that of the US by 2030, which means a dramatic change in the geopolitics of technology short term.

Due to this, the US government announced in early October a new series of sanctions against China that seek to completely stop the advance of the Asian country in dominating the semiconductor market.

These sanctions prohibit manufacturers from selling chips, semiconductors, and artificial intelligence to the Chinese government, in an effort to wipe out its semiconductor manufacturing industry.

The measures taken have caused massive resignations in Chinese technology companies and further accentuate the problems between China and Taiwan, who are the current leaders in the development and production of semiconductors worldwide.

The impact of war on sustainable energy development

Another market that is being affected by the conflict in Ukraine is the sustainable energy, where nickel and lithium are essential for the manufacture of batteries for electric cars.

Durante el mes de marzo, la Bolsa de metales de Londres se vio obligada a detener el comercio de níquel due to the volatility that its price was presenting, which increased more than 250% in just two days.

This market instability is mainly due to two reasons. On the one hand, the economic sanctions imposed on Russia have reduced its ability to supply the nickel market, which until then represented 7% of the total produced in the world, causing a reduction in supply.

Second, after the start of the war many investors closed their positions fearing a sudden drop and soon found it necessary to buy back in an attempt to minimize their losses. This sent the price of the metal skyrocketing in a few hours, due to the buying pressure exercised by the market itself.

Una vez más, esta situación termina beneficiando a China, quien es actualmente el leading producer of stainless steel del mundo. El segundo mineral clave en la transición a la energía sostenible es el litio, por lo que asegurar su producción garantizará un aumento en la demanda de coches eléctricos a corto plazo.

China currently leads this market and is taking strategic steps to secure its supply chain, such as construction of a lithium plant in the Argentine Republic which, according to plans, will begin production in 2023.

The ICT sector is also affected by the war

crisis-en-la-tecnología

Además de la escasez de minerales tecnológicos producida por la guerra en Ucrania, existen otros factores capaces de causar una crisis in technology. En primer lugar, los altos precios debido a la volatilidad del mercado han disparado la inflación a nivel mundial, causando una decline in demand for technology products.

As there is less demand, production also decreases and consequently labor recruitment qualified in this sector. Currently, it is estimated that more than 100 IT companies have subsidiaries in Russia and Ukraine and are finding it necessary to reevaluate your business plans in the medium and long term due to the difficulties they face due to the war.

Solo en octubre pasado, EE.UU a desatado su ofensiva al restringir tecnología a las empresas chinas. Sin duda la respuesta no se dejará esperar por parte del gigante Asiático quien busca reforzar su posición como superpotencia apoyado fuertemente por la tecnología.

EE.UU Lanza ofensiva total en la guerra tecnológica con China

These difficulties could extend for a time, accentuating the shortage of semiconductors and a significant increase in the price of different electronic components.

¿Ataques cibernéticos?

On the other hand, some analysts say that, due to the complexity of modern warfare, some key companies and institutions such as the financial sector, communications companies and public services could be targeted cyber attacks.

Gartner, an information technology research and consulting firm, has published a report pronosticando una caída del mercado de las PC’s. Según los expertos, el mercado de las PC’s de consumo disminuirá un 13,1% y el de las PC’s comerciales un 7,1% durante este año.

In the following table we can see how Gartner has classified the markets according to the type of device and its behavior in recent years.

Type of device% market growth 2021% market growth 2022
personal computers11,0%-9,5%
Tablets-0,8%-9,0%
Mobile phones5,0%-7,1%
Total Devices5,5%-7,6%

Otro impacto negativo de la guerra en el sector TI es el retraso que está causando en la technology expansion in remote areas of Latin America through the satellites of the OneWeb company.

Esta empresa tenía planeado el lanzamiento de 428 satélites con la ayuda de la Agencia Espacial Rusa desde el centro espacial de Baikonur. De los 428, aproximadamente el 65% ya fueron puestos en órbita y el lanzamiento del resto estaba planeado para este año.

Sin embargo, debido a las sanciones que impuso a Rusia la Unión Europea, OneWeb tuvo que lay off el proyecto. Retrasando así su expansión en América Latina.

A crisis in technology can change the world order

It is a fact that the war in Ukraine can cause a crisis in technology short term. However, the consequences of that crisis can last for a long time, even reaching change the order among the current powers of the world.

The food crisis, inflation and the scarcity of strategic raw materials are just a small sample of los estragos que puede causar una guerra, not to mention the latent threat of the use of nuclear weapons that have the potential to destroy the entire planet.

For now, we can only hope that the conflict is resolved as soon as possible and that it does not escalate to higher levels that represent a global threat to our civilization.

Experience has taught us over the years that war is the main enemy of the development and prosperity of nations. The only solution for the crisis that is causing the conflict is international integration and cooperation.

Hoy en día, nuestras prioridades deberían ser detener la guerra en Ucrania, ayudar a los países a frenar la inflación y unirnos contra la pandemia que estamos enfrentando. Si las naciones se unen y cooperan unas con otras, volveremos a tener la esperanza de un mundo mejor para nuestras futuras generaciones.

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I AM HECTOR PINCHEIRA | TECHNOLOGICAL EXPERT

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