Amid a worsening stand-off between East and West, Russia and China are increasingly contemplating using their own currencies in mutual settlements and finding ways to work together to counter sanctions, Moscow’s envoy in Beijing has disclosed.
Speaking as part of an appearance on YouTube channel Soloviev Live on Wednesday, Andrey Denisov weighed in on the impact of embargoes imposed by Western nations on ties between the two nations.
“The fact that these sanctions have a negative impact on some aspects of our relations is indeed true,” he said, pointing at the impact on financial settlements. “If penalties are imposed on one of our banks, it is quite difficult for Chinese recipients of our products to pay us, although they have the money and the desire to do so.”
According to the envoy, “it is no coincidence that in recent years we have been talking more and more about the wider use of national currencies in the settlement of foreign trade transactions.”
“So measures to counteract the pressure of sanctions that we can apply together, we certainly do – and by the way, we are discussing this issue with our Chinese partners,” Denisov said.
The two countries have emphasized the importance of their relations in an array of spheres, including trade, energy, and defense in the face of strained relations with the West in recent months. However, a number of analysts have previously suggested that the meaningful ties between the two powers are limited in comparison to blocs like NATO.
In December, President Vladimir Putin’s foreign policy advisor, Yuri Ushakov, revealed that the Russian leader and his Chinese counterpart, Xi Jinping, had vowed to develop shared financial structures to enable the two nations to deepen their economic ties, without the interference of third countries.
The move appeared to be a response to a series of warnings from the West that Moscow could be cut off from the Brussels-based SWIFT international payment system as a punitive measure if Russian troops were to stage an invasion of Ukraine.
Last year, Russian Foreign Minister Sergey Lavrov said that the two nations “need to move away from the use of Western-controlled international payment systems.” His remarks echoed earlier comments from his deputy, Sergey Ryabkov, who told the Bloomberg business news outlet that it was necessary to “barricade ourselves against the US financial and economic system to eliminate dependence on this toxic source of permanent hostile actions,” and “cut back the role of the dollar in any operations.”