An intergovernmental group created by China is studying Russia's experience in circumventing Western sanctions in response to the Kremlin's criminal war against Ukraine.
Points of attention
- China's intergovernmental group is studying Russia's experience in circumventing Western sanctions to prepare for possible conflicts, especially with Taiwan.
- Lessons from Russia emphasize the importance of diversifying reserves and building a separate financial system, guiding China's strategic approach.
- The economic similarities between Russia and China may lead to innovative cooperation strategies in the face of sanctions and restrictions.
- China closely monitors the impact of sanctions on Russia's economy and engages in non-public research to mitigate potential sanctions, particularly in scenarios of aggression.
- China's focus on protecting its significant gold and foreign exchange reserves drives efforts to separate from dollar assets, drawing insights and strategy from Russia's experience.
What is known about China's intentions to use Russia's experience in circumventing sanctions
It is noted that after the start of the war against Ukraine launched by the aggressor country, this group studies the impact of sanctions on the Russian economy and regularly reports on this to the country's leadership.
In this way, the Chinese leadership wants to develop its own measures to mitigate possible sanctions, especially in the case of aggression against Taiwan.
In particular, officials from the People's Republic of China regularly visit Moscow and hold meetings with representatives of the Central Bank, the Ministry of Finance and other departments of the aggressor country.
Non-public Chinese research is evidence of a new large-scale economic war, which began after the criminal invasion of the occupation army of the Russian Federation in Ukraine.
Analysts expect that the confrontation in the economic sphere will only intensify during the presidency of the Republican Donald Trump.
Persons close to the leadership of China noted in a comment to journalists that the activity of the research group does not mean that the country is ready for confrontation.
Which is causing concern in China
They claim that the country's leadership is preparing for extreme scenarios of an armed conflict and its economic consequences.
China is said to be very concerned about its own gold and foreign exchange reserves, which are the largest in the world at $3.3 trillion.
Russia's asset freezes by Western partners are prompting Beijing to more actively seek ways to separate its reserves from dollar-denominated assets such as US Treasuries.
One of the main lessons for China from the Russian experience is the importance of preparation, analysts say. Before the war, Russia tried to diversify its currency reserves, de-dollarize the economy and build an internal financial system. Although its success was mixed, these steps helped to protect the Russian economy and buy time for adaptation.
Another lesson for China is the value and limits of coalitions. The US, UK, EU and other allies worked in unison to exclude Russia's biggest banks from the Swift financial network and impose a ceiling on oil prices, while Russia responded by strengthening ties with China, Iran and North Korea.
Russia has also found a route through the former Soviet republics to purchase banned Western goods — from luxury cars to military dual-use goods such as microchips — as part of the so-called "Eurasian bypass."
