Russia and China find workarounds for payments despite US sanctions

Vladimir Putin's visit to China last month helped provide both countries with payment alternatives to circumvent sanctions.

Reuters reports.

Following Putin's visit, specially authorized banks were established in China's border regions to allow Russian firms to open non-resident accounts.

This step became more important after sanctions were imposed on the Shanghai branch of Russia's VTB Bank.

This led to a narrowing of the opportunities for Russian-Chinese trade, as it was the only branch of the Russian bank in China.

In 2023, trade between Russia and China grew to a record $240 billion. But maintaining this important flow for the Kremlin depends on ensuring uninterrupted payments.

The workaround, which involves smaller regional banks that may not yet be subject to U.S. sanctions, demonstrates how Moscow and Beijing are being forced to take increasingly complex steps to ensure that bilateral payments continue.

Author - Olena Madiak, 22/06/2024