The US government has taken its biggest step so far in holding individual Chinese companies accountable for their involvement in the Russian war effort – and Beijing is furious.
US Sanctions Announced
Last week the Biden administration announced an extensive list of sanctions targeting firms that have continued to supply products and services that have contributed to the Russian war effort in Ukraine – and one particular government is furious.
400 Entities Named
Of the nearly 400 entities and individuals named on Friday, dozens are Chinese companies that the US has accused of supporting the invasion.
Beijing Responds
Beijing swiftly responded to the sanctions list on Sunday. China’s Ministry of Commerce released a statement emphasizing the government’s firm opposition, describing Beijing as “strongly dissatisfied” with the administration’s decision.
Using the “Long-Arm Jurisdiction”
“The U.S. actions are typical examples of unilateral sanctions and ‘long-arm jurisdiction,’ which undermine international trade order and rules, hinder normal international economic and trade exchanges and affect the security and stability of global industrial and supply chains,” a ministry spokesperson wrote.
Urging the US to End Sanctions
“China urges the U.S. to immediately stop its erroneous practices and will take necessary measures to resolutely safeguard the legitimate rights and interests of Chinese enterprises,” it continued.
Repeated Warnings
Since the invasion of Ukraine in 2022, the US has repeatedly warned China about its continued trade relations with China and the impact it has had on the Russian war machine.
Russia’s Ally
China, which is both a political and economic ally of Russia, has responded by denying any support for the war effort and painting itself as a neutral party.
Largest Action Taken
Friday’s sanctions list is the most direct action the US has taken against Russian-affiliated Chinese businesses since the war in Ukraine began.
Companies Involved
It includes sanctions on two major tool suppliers, six electrical component suppliers, and more. Some companies also supplied parts for the Russian company Special Technology Center, which specializes in making surveillance drones.
Hoping to Hit Them Where It Hurts
The Biden administration hopes to weaken Moscow’s war arsenal by targeting the companies that support its supply chain and defense base.
Dual-Use Goods
In particular, companies that produce dual-use goods such as microelectronics and computer numerical control items sell them to Russia, where they can then be used for military applications.
Other Industries
Other companies affected are in adjacent industries including energy production, bulletproof glass and armor manufacturing, air transport, and more.
No US Trade Without Licenses
Under these sanctions, all named entities will be unable to trade with US firms without a special license. These licenses are exceptionally difficult to obtain.
An Ongoing Concern
“We remain concerned by the magnitude of dual-use goods exports from the PRC to Russia,” the State Department’s statement reads.
Enabling Russia’s Defense Production Cycle
“Imports from the PRC are filling critical gaps in Russia’s defense production cycle,” the statement continued. “Thereby enabling it to produce weapons, ramp up defense production, and bolster its military-industrial base.”
Other Countries Involved
And it isn’t just the PRC (People’s Republic of China). Aside from China, these latest US sanctions named 60 technology and defense companies based in Russia, as well as a slate of firms in Turkey, France, the United Arab Emirates, Kyrgyzstan, and Kazakhstan.
“It Doesn’t Matter” Which Country
“The fact that nearly half of these parties are located in countries outside Russia should serve as a stark reminder: it doesn’t matter whether you’re in the People’s Republic of China or Türkiye,” said Assistant Secretary of Commerce for Export Enforcement Matthew Axelrod in a separate statement.
Common High-Priority List Items
“If you send Common High Priority List items (or a range of other items) to Russia, you risk being added to the BIS Entity List,” he added.
Hundreds of Sanctions So Far
While it is the US’ most sweeping action against Chinese companies so far, it is just the latest of hundreds of sanctions added to the Entity List targeting the Russian war effort, marking more than 1000 so far.
In the Wake of the G7 Summit
Friday’s announcement is the first step following President Joe Biden’s commitment to raise the cost of the Russian war machine this year and cripple its supply chains, which he announced at a G7 Summit in Apulia, Italy, in June.
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