On the day Russian Foreign Minister Sergei Lavrov arrived in Beijing to discuss problems with processing Russian payments, U.S. Treasury Secretary Janet Yellen openly warned Chinese banks: helping Russia circumvent sanctions is not an option. Although U.S. officials in closed-door talks are making considerable efforts to persuade countries actively working with Russia to comply with the restrictions, here the person with the “least hawkish stance” among the senior representatives of the Joe Biden administration went on the “attack”, Bloomberg writes.
During her four-day visit, Yellen discussed economic issues with her Chinese counterparts, but on the last day “directly threatened sanctions”, the agency notes. At a press conference at the U.S. ambassador’s residence, Yellen said: “I emphasized that companies, including those in the PRC, should not provide material support to a war-mongering Russia and that they would face serious consequences if they did so. Any banks that conduct significant transactions that provide military or dual-use goods to Russia’s defense industry expose themselves to the risk of U.S. sanctions”.
Although China is nominally neutral on the war in Ukraine, it has capitalized on Russia’s isolation and the severing of economic ties between Russia and Western countries. Trade turnover between China and Russia rose to $240.1 billion in 2023, up 26.3% from 2022, according to China’s General Administration of Customs. Chinese exports, meanwhile, rose 46.9%, nearly reaching $111 billion.
China has become one of the main centers for supplying Russia with sanctioned products. But in December, the U.S. Treasury Department gained the ability to impose secondary sanctions against banks that help make payments for products that could be used for weapons production. After that, banks in China and other countries, including Turkey, Kazakhstan and a number of CIS countries, became much stricter in their dealings with Russian importers.
A survey conducted among the latest by The Moscow Times found that Chinese banks have begun to comply with sanctions against Russia even more than necessary. They can go weeks without making payments and ask for documents on contacts, purchase purposes and assurances that the end buyer is not linked to the Russian army or military-industrial complex. “According to statistics from the Russian bank we work with, no more than 25 percent of payments have gone to China since March 1”, said the owner of an export-import company.
