According to Filatov, Russian companies that previously enjoyed trusted credit terms now face unprecedented challenges due to payment reversals. Additionally, new Russian businesses are largely ignored by Chinese exporters until full prepayment is ensured. The payment process itself is becoming increasingly complicated. Instances of banks returning payments for shipped goods due to a lack of “sanction compliance certification” have been reported.
Fearing secondary sanctions, Chinese banks are opting to reverse payments, irrespective of whether the goods have been dispatched to Russia. This caution extends even to non-sanctioned items, which occasionally leads to payment failures, compelling Chinese suppliers to halt shipments. Market players warn that the blockage could extend to civil goods.
Earlier reports from Reuters indicated that numerous Russian companies are grappling with increased delays) and soaring costs in settlements with Chinese trade partners, leaving transactions worth tens of billions of yuan “in limbo.”
This evolving scenario underscores the profound ripple effects of international sanctions on trade dynamics between China and Russia.
