Russia Economy: Payment to China May Take 6 Months Most bounce back.

• It takes up to six months for trade payments from Russia to China to clear, Kommersant reported.
• Chinese banks are tightening compliance checks, fearing the fallout from Western sanctions.
• A second round of U.S. sanctions on financial institutions that help Russia have intensified since December.

Trade between Russia and China is becoming more difficult, with some payments between partners taking up to half a year. Commercial Business Daily reported on Monday.

About 80% of bank transfers made in Chinese yuan are returning without explanation after being halted for weeks.

Such returns could result in exchange rate or commission losses for Russian businesses, according to media outlets.

Kommersant’s report intensifies pressure on external parties dealing with Russian companies that continue to conduct their international business operations despite severe economic sanctions.

Earlier this month, several unnamed major Russian commodity exporters said Bloomberg Trade with China has become increasingly difficult as even direct payments made in Chinese yuan are frozen or delayed.

The trouble started when the US let in in December Secondary barriers Russia Targets Financial Institutions That Help Evade Sanctions

This has prompted global banks from China to the United Arab Emirates, Turkey and Austria to curtail transactions with Russia.

fee Problems escalated last month when the U.S. Treasury released a new package Comprehensive US sanctions Against Russia, Moscow, Russia’s main stock exchange, forced a halt to trading Dollar and Euro trading.

To get around stricter restrictions, some Russians who want to buy goods from Chinese companies must now go through middlemen — at an additional cost, according to Kommersant.

The US and its allies are punishing those who interact with Russia

The development comes 29 months after Russia’s full-scale invasion of Ukraine.

The West failed to force Russia to end its war Some Russian banks From the widely used SWIFT messaging system for payments early in the conflict. However, Russia and its trading partners have been able to circumvent the sanctions by using small banks and other payment systems or currencies other than the US dollar.

Continued business activities between the two countries recorded trade between Russia and China at $240 billion last year. In June, China’s yuan-denominated exports 4.76% YoY growth for Russia in June.

Beijing has neither condemned nor sanctioned Moscow’s full-scale invasion of Ukraine. The two countries are not formal allies, but a A long and complicated relationship is receiving Closer in recent years.

Even so, the US and its allies are tightening restrictions.

Earlier this month, a top Russian banker said sanctions-busting methods had to be turned into a „state secret” because they were being shut down so fast.

„Whatever action we take, we can see that the reaction is very quick,” said Andrey Kostin, CEO of VTB Bank, Russia’s second-largest lender.

Russia has said that Working with a group of countries To create a site that does not require dollars.

Some Russian businesses used cryptocurrencies to make settlements through Hong Kong, but through Central Asian intermediaries, Bloomberg reported last week.