China is preparing for sanctions. Does the fate of Russia await him?

China prepares for sanctions

Citing a source, the British newspaper The Guardian reported on the eve of an extensive “stress test” carried out by Chinese authorities to examine the consequences of sanctions similar to those imposed on Russia.

According to the publication, key government offices in China have been tasked with developing response measures in the event that similar sanctions are imposed on Beijing.

“From Beijing’s point of view, if the US-led Western allies can take such action against Moscow, they can do the same against China.

“The country needs to know how resilient it really is,” said Tong Zhao, a senior fellow at the Carnegie Endowment in Beijing.

The Guardian’s source says the check was a “natural reaction” given Beijing’s close relationship with Moscow. Another source, who did not want to be named, said that Chinese diplomats have also met with experts in the last few weeks to understand the course of sanctions pressure on Russia.

Professor Alexei Maslov, Director of the Institute for Asian and African Studies at Moscow State University, in a conversation with socialbites.ca noted that while sanctions against China are indeed possible, they will be of a completely different nature and order from the sanctions imposed on China. Therefore, it does not make sense for Russia to prepare for anti-Russian Sanctions against China.

“China has become more deeply integrated into the global economy. And the sanctions against it are a very serious story not only for China, but also for the West.

In this context, it is likely that China will also calculate the impact of possible sanctions on the global economy,” he said.

In addition, Maslov noted more clear indications that China is preparing to face sanctions with the United States and its allies.

“We are currently seeing China actively developing its parallel financial banking system. And although it is not officially stated anywhere that this will be a parallel or alternative instrument to the dollar mass, it is clear that China wants to be independent of the SWIFT system. Finally, China is now looking at payment possibilities via Union Pay – how much can be blocked and how these risks can be hedged,” said the ISAA professor.

What about sanctions against China?

Among the sanctions that can be imposed on China are Alexey Maslov, banning the work of Chinese high-tech companies in Western countries; Prohibition of placement and production of high-tech products in China; Banning the supply of high-tech products to China and the creation of joint laboratories for it.

“I also authorize the blocking of the assets of Chinese businesses operating in the United States and Western Europe, Australia and New Zealand, banning the purchase from China of products manufactured by businesses that are subject to sanctions, from radio electronics to food. products and textiles. Banning Sino-foreign joint ventures outside of China.

China will not be able to enter Western markets,” said Maslov, adding that this is “the worst-case scenario”.

At the same time, he pointed out that these sanctions will have a two-sided effect and cause a decrease in the quality of life in Western countries, an increase in inflation and a depreciation of the dollar, which is also tied to Chinese commodities. a banal increase in mass and cost of goods.

For his part, Alexander Lomanov, Professor at the Institute of World Economy and International Relations of the Russian Academy of Sciences (IMEMO), states that the situation around anti-Russian sanctions, at least, shows that Europe “is ready to go on its own.” restraint and self-interest.”

“Still, it is clear that Europe and America will try to preserve as much as possible the benefits they derive from trade with China. But it’s not about trade,” Lomanov said.

According to him, China’s main concerns stemmed from the Western governments’ decision to freeze the Russian Central Bank’s gold and foreign exchange reserves.

“There is a lot more Chinese presence in the West – China doesn’t want to lose that money that way. “Of course, the Chinese economy will not collapse due to this loss, but of course it is time Beijing considers how to secure these huge sums that China has accumulated over the decades.”

Why would the West impose sanctions on China?

According to Aleksey Maslov, China’s separation from the international financial system is almost inevitable, which is why sanction supporters in the Western elite are driven by the idea of ​​a “preventive strike”.

“There is a discussion in the USA that China will go to a border from the world financial system in 10-15 years anyway. Therefore, they are just trying to be proactive and cause social instability in China,” he said.

Alexander Lomanov also states that the sanction scenario “cannot be initiated on its own”.

“It is impossible to impose such sanctions on China without any reason and motivation. It is clear that something extraordinary must happen for this to happen. The most likely is, of course, a military operation to reunite with Taiwan,” he said.

From his point of view, the Chinese authorities will not launch such an operation in the short term or even in the medium term, but aim to ensure that they have every opportunity to do so at any time.

“At the very least, they need to be able to speak with confidence to both Taiwan and the West that China reserves the right to implement a military scenario if necessary in the event of a crisis.

Therefore, it is out of question to prepare for sanctions and start an operation right away.

“It’s about being prepared and reassuring opponents that China is ready to conduct a military operation, even taking into account the subsequent large-scale anti-Chinese sanctions,” Lomanov said.

From his perspective, the world economy may be calm in the next few years and not wait for the results of a large-scale economic attack on Beijing.

“A few months ago, when the crisis around Ukraine was just beginning, Taiwanese experts said that Taiwan has at least three years of quiet life ahead – this is the minimum time China will need to adapt its economy, its financial situation. Sanctions comparable in depth and scope to those imposed on Russia. But at least three years. On the contrary, it has been even five years,” he said.