China is quietly making life harder for Russia in these 4 ways
From CNN's Laura He
China is quietly distancing itself from Russia's sanction-hit economy.
The two states proclaimed last month that their friendship had "no limits." But that was before Russia launched its war in Ukraine.
Here are some measures Beijing has taken in the past few weeks to distance itself from the isolated and crumbling Russian economy.
Letting the ruble drop: China's currency, the yuan, doesn't trade completely freely, moving instead within bands set by officials at the People's Bank of China (PBOC). Last week, they doubled the size of the ruble trading range, allowing the Russian currency to fall faster. The ruble has already lost more than 20% of its value against both the dollar and euro since the start of the war in Ukraine. By allowing the Russian currency to fall against the yuan, Beijing isn't doing Moscow any favors.
Sitting on reserves: The most significant help China could offer Russia is through the $90 billion worth of reserves Moscow holds in yuan, wrote Alicia García-Herrero, chief economist for Asia Pacific at Natixis, in a research report on Tuesday. Sanctions have frozen about $315 billion worth of Russia's reserves — or roughly half the total — as Western countries have banned dealing with the Russian central bank. Russia's finance minister Anton Siluanov said this week that the country wanted to use yuan reserves after Moscow was blocked from accessing US dollars and euros, according to Russia's state media. The PBOC has so far not made any comment about its position regarding these reserves.
Withholding aircraft parts: Sanctions imposed by the US and the European Union mean the world's two major aircraft makers, Boeing (BA) and Airbus (EADSF), are no longer able to supply spare parts or provide maintenance support for Russian airlines. The same is true of jet engine makers. Earlier this month, a top Russian official said that China has refused to send aircraft parts to Russia as Moscow looks for alternative supplies.
Freezing infrastructure investment: The World Bank has halted all its programs in Russia and Belarus following the invasion of Ukraine. It hadn't approved any new loans or investments to Russia since 2014, and none to Belarus since 2020. More surprisingly, perhaps, is the decision by the Beijing-based Asian Infrastructure Investment Bank to do the same. In a statement earlier this month, it said it was suspending all its activities related to Russia and Belarus "as the war in Ukraine unfolds." The move was "in the best interests" of the bank, it added.
https://amp.cnn.com/cnn/europe/live-news/ukraine-russia-putin-news-03-17-22/index.html
From CNN's Laura He
China is quietly distancing itself from Russia's sanction-hit economy.
The two states proclaimed last month that their friendship had "no limits." But that was before Russia launched its war in Ukraine.
Here are some measures Beijing has taken in the past few weeks to distance itself from the isolated and crumbling Russian economy.
Letting the ruble drop: China's currency, the yuan, doesn't trade completely freely, moving instead within bands set by officials at the People's Bank of China (PBOC). Last week, they doubled the size of the ruble trading range, allowing the Russian currency to fall faster. The ruble has already lost more than 20% of its value against both the dollar and euro since the start of the war in Ukraine. By allowing the Russian currency to fall against the yuan, Beijing isn't doing Moscow any favors.
Sitting on reserves: The most significant help China could offer Russia is through the $90 billion worth of reserves Moscow holds in yuan, wrote Alicia García-Herrero, chief economist for Asia Pacific at Natixis, in a research report on Tuesday. Sanctions have frozen about $315 billion worth of Russia's reserves — or roughly half the total — as Western countries have banned dealing with the Russian central bank. Russia's finance minister Anton Siluanov said this week that the country wanted to use yuan reserves after Moscow was blocked from accessing US dollars and euros, according to Russia's state media. The PBOC has so far not made any comment about its position regarding these reserves.
Withholding aircraft parts: Sanctions imposed by the US and the European Union mean the world's two major aircraft makers, Boeing (BA) and Airbus (EADSF), are no longer able to supply spare parts or provide maintenance support for Russian airlines. The same is true of jet engine makers. Earlier this month, a top Russian official said that China has refused to send aircraft parts to Russia as Moscow looks for alternative supplies.
Freezing infrastructure investment: The World Bank has halted all its programs in Russia and Belarus following the invasion of Ukraine. It hadn't approved any new loans or investments to Russia since 2014, and none to Belarus since 2020. More surprisingly, perhaps, is the decision by the Beijing-based Asian Infrastructure Investment Bank to do the same. In a statement earlier this month, it said it was suspending all its activities related to Russia and Belarus "as the war in Ukraine unfolds." The move was "in the best interests" of the bank, it added.
https://amp.cnn.com/cnn/europe/live-news/ukraine-russia-putin-news-03-17-22/index.html