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Russia is aided by sanctions from China; US warns Beijing

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By Mark Trevelyan

LONDON (Reuters) – Russia said on Sunday it was counting on China to help it weather the blow to its economy from Western sanctions over the war in Ukraine, but the United States warned Beijing not to provide that lifeline.

Russian Finance Minister Anton Siluanov said the sanctions had deprived Moscow of access to $300bn of its $640bn in gold and foreign exchange reserves, adding there was pressure on Beijing to close more.

“We have part of our gold and foreign exchange reserves in the Chinese currency, in yuan. And we see what pressure Western countries put on China to limit mutual trade with China. Of course there is pressure to limit access to those reserves,” he said.

“But I think that our partnership with China will still allow us to maintain the cooperation that we have achieved, and not only maintain it, but also increase it in an environment where Western markets are closing.”

Western countries have imposed unprecedented sanctions on Russia’s corporate and financial system since it invaded Ukraine on February 24 in what it calls a special military operation.

Siluanov’s comments in a television interview marked Moscow’s clearest statement yet that it will seek China’s help to cushion the blow.

But US national security adviser Jake Sullivan said Washington was warning China not to provide it.

“We are communicating directly, privately with Beijing, that there will absolutely be consequences for large-scale sanctions, evasion efforts, or supporting Russia to replenish them,” Sullivan told CNN.

“We will not allow that to go ahead and there is a lifeline for Russia from these economic sanctions from any country, anywhere in the world,” added Sullivan, who is due to meet China’s top diplomat Yang Jiechi in Rome on Monday. .

Russia and China have tightened cooperation in recent times as both have come under heavy Western pressure on human rights and a host of other issues. Beijing has not condemned Russia’s attack on Ukraine and does not call it an invasion, but has urged a negotiated solution.

Presidents Vladimir Putin and Xi Jinping met in Beijing on February 4 and announced a strategic partnership that they said was aimed at countering US influence, describing it as a boundless friendship.

China is Russia’s main export market after the European Union. Russian exports to China were worth $79.3 billion in 2021, with oil and gas accounting for 56% of that, according to China’s customs agency.

(Reporting by Mark Trevelyan; Editing by Hugh Lawson)

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