The other consequences depend very much on the will and ability of China to refuse or circumvent international sanctions. Within “modest” Chinese exports to Russia (68 billion US dollars, or “only” twelve times French sales, etc.), communication and digital equipment represent the largest item. However, the United States has enacted export bans in the field of semiconductors, and the recent case of Huawei shows to what extent, in certain fields, Chinese production remains dependent on patents or components, including third countries (and Taiwan) whose flows the United States can control. In the medium term, the civil aviation sector is also concerned. After the C919, China has started a project with Russia for the C929, a larger aircraft for which the engines are to be developed with Aviadvigatel, from the Russian group United Engine Corporation (UEC). On the one hand, Russian weaknesses in this area would have involved associating one of the Western engine manufacturers; on the other hand, where would such a plane be sold if the sanctions are maintained, and where would it fly to?
These examples show that complete decoupling in these areas with the United States presupposes, beyond the Sino-Russian market, that the two countries are technologically successful, and that their products are accepted by significant third-party markets. . They are still far from it, while military cooperation does not pose the same problems.
The other big unknown, of course, concerns financial flows. Let’s start with a very strong convergence of Chinese and Russian policies: both have maintained (China) or acquired (Russia) a balanced budget, and while Russia acquired 640 billion dollars of foreign exchange reserves on the rent energy, Xi’s China has moderated its appetite for domestic debt. The creation of alternative international payment systems to SWIFT (even if the Chinese system depends considerably on it), increased control over Russian oligarchs and large Chinese entrepreneurs, the one-way use of places offshore and their opacity…: all of this is common to both regimes.
But the very rise of China implies greater interdependence. Chinese banks have sometimes had to essentially apply American sanctions (case of North Korea, with indirect American sanctions against establishments in Macau), sometimes been spared by the United States (case of the removal of oil Iranian, presumably settled in yuan and trade credits for Iranian imports). This time, the problem is much bigger, the ban on flows with the Russian central bank coming as a surprise. Of course, there are short-term loopholes: in particular, 60 billion dollars of deposits in China by the BCR of reserves in yuan. Russia should not be prevented from mobilizing them to pay for its own imports or recover liquidity in rubles, as long as the price of the yuan and the Chinese trade surpluses are otherwise ascending: one can even conceive that Russian sales will suit the central bank China by avoiding interventions to limit this increase. We observe in the short term an offensive of the system UnionPay and Chinese banks in Russia on credit cards: this will no doubt also serve to increase sales of Chinese e-commerce in Russia, and more broadly that of consumer goods. But with what resources on the side of Russian consumers, if the ruble continues to fall?
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