Chinese state-owned banks stop trading with Russia 'en masse'
Russian companies are facing increasing delays and charges in payments with trading partners in China, putting tens of billions of yuan worth of transactions on hold, Russian sources told Reuters.
Several Russian companies and government officials have reported delays in transactions in recent months, after Chinese banks stepped up compliance following Western threats of secondary sanctions on trade with Russia. The sources said the problem has intensified this month.
Chinese state banks are halting transactions with Russia “en masse” and payments worth billions of yuan are being suspended, a source close to the Russian government told Reuters, speaking under the term of anonymity.
China is Russia's largest trading partner, accounting for a third of Russia's foreign trade last year, and supplies items such as vital industrial equipment and consumer goods that help Russia cope with Western sanctions. It also provides a lucrative market for many Russian exports that China relies on, from oil and gas to agricultural products.
Threats
After the US Treasury Department in June threatened banks in China and other countries with secondary sanctions for doing business with Russia, Chinese banks began to take a very tough stance on transactions, a source from one of Russia's top e-commerce platforms said. , which sells a wide variety of consumer goods imported from China.
“At that time, all cross-border payments to China stopped. We found solutions, but it took about three weeks, which is a very long time, trading volumes dropped drastically during that time,” said the same source.
One working solution was to buy gold, to take it to Hong Kong and sell it there, depositing cash in a local bank account, he added.
Sources told Reuters that some Russian businesses use chains of middlemen in third countries to process their transactions and to bypass the compliance checks of Chinese banks. So transaction processing costs have risen to 6% of transaction payments, up from almost zero before, they said.
“For many small companies this means a complete shutdown,” said a source close to the Russian government. .
It is recalled that this week the White House national security adviser, Jake Sullivan, had meetings with the Chinese leadership in Beijing, including his meeting with the Chinese president, Xi Jinping, yesterday, Thursday. in a rare case of Chinese cooperation with the US government.
