The U.S. is considering imposing sanctions on Chinese firms suspected of fueling Russia's full-scale war against Ukraine, CNBC reported on Feb. 19, citing U.S. Congress members.
This comes shortly after the EU proposed to include similar measures in its 13th sanctions package, making it the first time the European bloc considered directly targeting entities in mainland China.
While there is no evidence of Beijing's direct military support to Russia, local companies are suspected of helping Moscow avoid sanctions imposed by Kyiv's partners, supplying Moscow with sanctioned goods.
"China has to understand that the same kinds of sanctions which are beginning to really take hold in Russia and are affecting Russian productivity, economic performance and quality of life, can also be applied to China," Senator Gerald Connolly, member of the U.S. House Committee on Foreign Relations, told CNBC on Feb. 19 at the Munich Security Conference.
"And frankly, China has a lot more to lose than Russia."
The Chinese Foreign Ministry responded to the plans, saying Chinese companies have the right to conduct business with whomever they wish.
According to Connolly, imposing sanctions against China would "really hit home" as the country's "economic performance right now is already weak."
China currently faces economic challenges aggravated by post-COVID-19 recovery and real estate crisis. The International Monetary Fund projected China's economic growth would drop to 4.6% this year, down from its 5.2% growth in 2023 and fall further to 3.4% by 2028.
A U.S. intelligence report declassified in July 2023 said that China has exported dual-use technologies, semiconductors, and other supplies and materials that Russia uses in its war efforts in Ukraine. Beijing said its trade with Russia constitutes usual economic relations.
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