The volume of Chinese lending to Russia has shot up by over 400% since Moscow invaded Ukraine, according to a Financial Times report on Monday.
Data from the Kyiv School of Economics showed China’s ‘Big Four’ state banks increased their exposure to Russia from $2.2 billion to $9.7 billion in the 14 months since the war in Ukraine started and Western banks slashed their exposure to Moscow, it said.
The ‘Big Four’ banks – Bank of China, Industrial & Commercial Bank of China, China Construction Bank, and Agricultural Bank of China – have yet to comment on the jump in lending to Russia since the invasion.
Russia gets tougher on companies that want to leave
More than 1,000 companies have said they are curtailing operations in Russia, and more than double that number are reportedly seeking to exit the country, according to a study by Yale University.
But logistical delays and other problems have prevented hundreds of companies from leaving, a Business Insider report said on Monday, which added that only 535 companies had been able to make a “clean break”.
Russia’s deputy finance minister Alexei Moiseev warned last Friday that the country would not let foreign banks exit the market easily. Foreign banks must unfreeze Russian assets if they want to exit the market, he said.
“We have stated our position, and it stands — we will be tough in letting foreign banks go, it will depend on the decision to unfreeze Russian assets,” Moiseev said at a forum last Friday, Reuters reported.
Western nations and their allies have frozen over $300 billion worth of Russian Central Bank assets in foreign countries, according to a US Department of Treasury report last year on work by the REPO Task Force. REPO stands for ‘Russian Elites, Proxies and Oligarchs’.
Meanwhile, Chinese trade with Russia reached a record $190 billion last year and exports of Chinese cars to Russia jumped five-fold in the first five months of this year.
- Jim Pollard, with Reuters