On Friday, August 23, the United States further expanded sanctions on the international supply chain related to Russia, imposing sanctions on nearly 400 entities and individuals supporting Russia’s invasion of Ukraine. This includes 42 Chinese companies that U.S. officials believe are helping Moscow evade Western sanctions.
On the eve of Ukraine’s Independence Day on Saturday, August 24, the U.S. Treasury and the State Department announced the sanctions targeting entities and individuals in Russia and beyond, including in Asia, Europe, and the Middle East, whose products and services are believed to enable Russia to sustain the war and circumvent sanctions.
Wally Adeyemo, Deputy Secretary of the U.S. Treasury, stated in a press release on Friday that “Russia has turned its economy into a tool to serve the Kremlin’s military-industrial complex. Today’s action by the Treasury Department continues to fulfill the commitments made by President Biden and the Group of Seven (G7) partners to disrupt the supply chains and payment channels of Russian military bases.”
Adeyemo emphasized the need for companies, financial institutions, and governments worldwide to ensure they are not supporting Russia’s military supply chain.
Previously, Washington had strongly criticized China for providing military assistance to Russia, warning that Beijing may face further sanctions from the U.S. and other NATO countries.
According to a statement from the U.S. Treasury, the sanctions on Friday included Chinese companies supplying machine tools and microelectronics to Russia, such as a Chinese export-import company affiliated with Dalian Machine Tool Group, which provided dual-use products worth $4 million to Russian companies.
Additionally, several companies in Hong Kong and China supplied sanctioned Russian companies with products like electronic integrated circuits.
The Biden administration added 123 entities to the U.S. Entity List, which includes 63 Russian companies, 42 Chinese companies, and 18 companies from other countries suspected of supporting the Russian military.
Entities listed must obtain difficult-to-obtain licenses before U.S. suppliers can ship goods to them. Some of the sanctioned companies were also given a special designation requiring foreign suppliers to obtain U.S. permission before shipping to them.
The Chinese authorities have consistently denied providing weapons and equipment to Russia for the war in Ukraine, defending their so-called normal trade with Russia.
U.S. Secretary of State Antony Blinken had previously accused China of “playing both sides,” stating that 70% of the machine tools imported by Russian defense industry facilities are from China, and 90% of microelectronic products are also from China.
The Treasury’s sanctions also targeted multiple transnational networks involved in procuring ammunition and other goods for Russia, aiding Russian oligarchs and others in circumventing sanctions, laundering money for sanctioned Russian gold companies, and supporting Russia’s military industrial base through the purchase of advanced machinery and electronic components.
Almost all of these transnational networks involved the participation of Chinese companies.
The Treasury also focused on Russian financial technology companies providing essential software and IT solutions to the Russian financial industry.
Ukrainian President Zelensky expressed gratitude on social media for the United States’ “additional strong sanctions,” stating that the nearly 400 targets in the new U.S. sanctions plan will further weaken Russia’s capacity to launch aggressive wars.
National Security Advisor Jake Sullivan is set to visit Beijing from August 27 to 29 for his fifth meeting with Chinese Foreign Minister Wang Yi. According to a White House briefing on Friday, Sullivan is expected to once again express the U.S.’ serious concerns to Chinese authorities regarding their support for Russia’s defense industry and issues in the South China Sea.