Beijing has imposed sanctions on two European Union-based banks as retaliation for the EU’s sanctions on certain Chinese lenders linked to Russia’s invasion of Ukraine. This action fulfills China’s commitment to respond, as announced by the Ministry of Commerce.
On July 18, the European Union announced its 18th package of sanctions against Russia in response to the ongoing conflict in Ukraine, aimed at further targeting the Russian oil and energy sectors. This set of sanctions included measures against entities from third countries, particularly China, for allegedly assisting Russia’s military operations.
Why did China sanction two EU-based banks?
In its response, Beijing cautioned Brussels to revoke the sanctions against two Chinese banks or face retaliation. “The EU, disregarding China’s solemn position, insisted on adding two Chinese financial institutions to its sanctions list for alleged involvement in Russia, and formally implemented the sanctions on August 9,” the statement declared. It further noted that this move “severely damages the legitimate rights and interests of Chinese companies, and has a serious negative impact on China-EU economic and trade relations and financial cooperation.”
The sanctions specifically targeted Suifenhe Rural Commercial and Heihe Rural Commercial banks, alongside five additional companies. The EU claimed these banks were involved in providing cryptocurrency services that undermined the effectiveness of the sanctions.
Which Lithuanian banks are now on China’s countermeasure list?
The Ministry of Commerce announced on Wednesday that UAB Urbo Bankas and AB Mano Bankas have been added to China’s countermeasure list. This ban prohibits organizations and individuals within China from engaging in transactions or any form of cooperation with these institutions. Both banks are located in Lithuania. The basis for their selection was not specified, but the decision aligns with the recent tensions with the Baltic States.
The Ministry of Foreign Affairs expressed hope that the EU would “value” its relationship with China, “correct their mistakes” and “stop doing things that harm China’s interest.”
What has caused Lithuania’s relationship with China to deteriorate?
Last year, Lithuania expelled three Chinese embassy staffers, claiming they were not accredited. This occurred after Beijing had already downgraded diplomatic relations with Lithuania following the country’s decision to permit a Taiwanese representative office in Vilnius. Furthermore, relations between Beijing and Brussels have soured recently, partly due to China’s support for Russia amidst ongoing trade disputes. Last month, Beijing reacted to accusations from European Commission President Ursula von der Leyen regarding trade manipulation and restricted access for European businesses.
China’s latest sanctions signify a growing escalation in tensions between the EU and China, directly linked to the geopolitical ramifications of the conflict in Ukraine, reports 24brussels.
