Shanghai Cooperation Organization Shifts from US Dollar to Member CurrenciesThe Chinese government has voiced its opposition to the recent US sanctions on several national companies for alleged collaboration with Russia. However, these companies, mostly involved in the electronics industry, were allegedly used as intermediaries to purchase US technology and deliver it to Russia, bypassing sanctions imposed by the Office of Foreign Assets Control (OFAC) on Russian entities.
China’s Commerce Ministry denounces US ‘long-arm jurisdiction’
China’s Commerce Ministry released a statement condemning the US move as an overreach and a “typical form of long-arm jurisdiction” that seriously undermines the legitimate rights and interests of these companies and threatens the security and stability of the global supply chain. China called on the US to “correct this wrongdoing” and pledged to defend the rights and interests of its businesses.
This is not the first instance of Chinese companies facing sanctions for allegedly assisting other countries in evading existing sanctions. In March, several Chinese firms were sanctioned for working with Iranian companies that supported the Russian war effort. Another group of Chinese companies was also sanctioned for creating a shadow banking system for Iranian firms.
Concerns over US-China relations
These sanctions have raised concerns among experts about the potential impact on the already strained US-China relationship, particularly in light of ongoing tensions surrounding Taiwan. Former US Treasury Secretary Hank Paulson warned that “the US-China relationship is on the brink” and current government policies are not helping to ease the situation.
President Joe Biden has also recently extended a series of sanctions against Russian military and industrial companies.
In a recent Financial Times interview, Paulson discussed the consequences of these policies, stating, “If America goes too far in curtailing trade and investment with China and we go far beyond what our allies and partners want to do, the result will be to isolate the US.”
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