US prepares sanctions against Chinese banks for helping Russia

The United States is preparing draft sanctions that could cut off some Chinese banks from the global financial system in order to stop Beijing's support for the Russian military-industrial complex.

This was reported by the Wall Street Journal, citing informed sources.

According to U.S. officials, sanctions against Chinese banks are an escalation option in case diplomatic measures fail to persuade Beijing to limit exports to Russia.

Cutting off banks from access to the dollar is often used as a last resort, as such sanctions often lead to bankruptcy.

This would also pose a particular risk to China amid a slow economic recovery and growing debt. The article does not specify which banks may be sanctioned.

Until now, Washington has been reluctant to impose sanctions on large Chinese banks, as analysts have long considered this option a "nuclear option" because of the effect it could have on the global economy and US-China relations.

Author - Olena Madiak, 23/04/2024