Exclusive: China firms go 'underground' on Russia payments as banks pull back

U.S. Secretary of State Antony Blinken, after meeting China's top diplomat Wang Yi for five and a half hours in Beijing on Friday, said he had expressed "serious concern" that Beijing was "powering Russia's brutal war of aggression against Ukraine". Still, his visit, which included meeting President Xi Jinping, was the latest in a series of steps that have tempered the public acrimony that drove relations between the world's biggest economies to historic lows last year.

While officials have warned that the United States was ready to take action against Chinese financial institutions facilitating trade in goods with dual civilian and military applications and the U.S. preliminarily has discussed sanctions on some Chinese banks, a U.S. official told Reuters last week Washington does not yet have a plan to implement such measures.

The Chinese foreign ministry spokesperson said, "China does not accept any illegal, unilateral sanctions. Normal trade cooperation between China and Russia is not subject to disruption by any third party."
A State Department spokesperson, asked about Reuters findings that Chinese banks were curbing payments from Russia and the impact on some Chinese companies, said, "Fuelling Russia’s defence industrial base not only threatens Ukrainian security, it threatens European security.

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