China’s state-owned banks are widely halting transactions with the Russian Federation, and payments are being delayed, Reuters said.
Negotiation problems with Chinese partners worsened in Russia in August, Reuters reports.
Some Russian companies are facing long delays and rising costs to settle payments to trading partners in China, leaving transactions worth tens of billions of yuan in limbo.
Russian companies and officials pointed to delays in transactions for months after Chinese banks tightened enforcement following Western threats to impose a second round of sanctions for dealings with Russia.
China’s state-owned banks have cut deals with Russia en masse, and billions of yuan in payments have been delayed.
Transaction processing costs have risen to 6% of transaction payments, up from almost zero previously.
A working theory is to buy gold, take it to Hong Kong and sell it there, depositing the cash in a local bank account.
China is Russia’s largest trading partner, accounting for a third of Russia’s foreign trade last year and supplying goods such as essential industrial equipment and consumer goods that help Russia cope with Western sanctions .
It also provides a useful market for many of Russia’s exports that rely on China, from oil and gas to agricultural products.
We remind you that the state-owned VTB Bank, the only state-owned bank in the Russian Federation with a full-fledged branch in China, has decided to raise fees for yuan transactions.
Source: korrespondent
I’m Liza Grey, an experienced news writer and author at the Buna Times. I specialize in writing about economic issues, with a focus on uncovering stories that have a positive impact on society. With over seven years of experience in the news industry, I am highly knowledgeable about current events and the ways in which they affect our daily lives.