According to the Wall Street Journal, the White House is trying to draft a new sanctions against China, which aims to impose sanctions on Chinese banks and kick them out of the SWIFT global financial settlement system.
1. The United States is targeting China?
According to the US media, the reason why the Biden administration drafted this sanction is because the United States believes that China has provided Russia with a large number of war tools in its trade with Russia, and the White House hopes that this sanction can form an effective "deterrent" to China, so as to prevent China from continuing to provide Russia with the ability to continue to maintain the war. To put it simply, it is to demand that China and Russia "break contact".
On the issue of Sino-Russian trade, the United States is even more guilty of what it wants to do. As the world's largest exporter and the largest trading partner with 130 countries and regions around the world, China has the right and ability to decide with which country to develop bilateral trade.
In addition, because of the impact of the Russian-Ukrainian war, the trade between China and Russia has never involved any military trade, and the United States is not qualified to dictate to Sino-Russian trade.
After the United States announced sanctions against the Bank of China, Russian Foreign Minister Sergei Lavrov said that 90% of Sino-Russian trade has been paid in national currencies, basically de-dollarization.
At the same time, Lavrov also stressed that although the United States and Western countries continue to hinder Sino-Russian economic and trade cooperation, Sino-Russian trade will not be affected because of the United States. Sino-Russian relations are now in the best period in history, and the potential for Sino-Russian regional cooperation is still huge.
Previously, Zhang Hanhui, the mainland's ambassador to Russia, had said that the trade settlement between China and Russia had indeed encountered some problems, and although some countries were obstructed, I believe that we could find a way to overcome the problems.
Specifically, it is actually worried that the United States and its allies will impose "secondary sanctions" on Chinese banks, and trade between China and Russia may be affected.
Even so, trade between China and Russia is unlikely to come to a standstill, because judging from the news revealed by the Russian media TASS, Russia's trade with China has not been affected by financial settlement transactions.
In response, Chinese Foreign Ministry spokesman Wang Wenbin said that he resolutely opposes the United States' own efforts to add fuel to the fire of the Russia-Ukraine war while shifting the blame to China. China has the right to conduct normal commercial exchanges with other countries, including Russia, and China will firmly defend China's legitimate rights and interests.
2. China's response strategy
1. Building an independent payment system: In the face of the threat of U.S. sanctions, it is necessary for China to accelerate the construction of a cross-border payment system (CIPS) for the renminbi. By improving the CIPS system, we can provide more convenient and efficient RMB clearing services for global customers and reduce their dependence on the SWIFT system.
2. Bilateral Currency Swap Agreements: Strengthen bilateral currency swap agreements with other countries, such as the RMB-Euro bilateral swap mechanism between China and the EU. Such an arrangement would allow for the exchange of the currencies of the two countries directly without SWIFT, thereby supporting bilateral trade and investment.
3. International application of digital currency: Actively explore the international application of digital yuan (e-CNY). The cross-border payment function of digital currency may provide Chinese enterprises with a new cross-border settlement method, reduce transaction costs, and improve transaction efficiency.
3. The U.S. kicks China out of Swift's influence
The SWIFT system currently covers more than 200 countries and has access to more than 11,000 financial institutions, and about 90% of the world's cross-border payments need to be made through the system.
Once the United States chooses to kick our banks "out of the circle", it will mean that these Chinese banks will be cut off from obtaining US dollars, and it will be impossible to carry out international business.
However, as the world's second largest economy, China's market size and economic influence cannot be ignored. If China can effectively take these steps to reduce its dependence on SWIFT, the effectiveness of US sanctions will be greatly reduced.
Second, U.S. sanctions could have a knock-on impact on global supply chains. Stability of the global financial systemSWIFT, as the nerve center of global financial settlement, is essential for international trade and financial flows.
Since China occupies an important position in the global industrial chain, any restrictions on Chinese exports and imports could lead to the disruption or restructuring of global supply chains, which is also a huge challenge for American companies.
To sum up, although the news that the United States is considering kicking China out of the SWIFT system is unlikely, if it is really realized, it will undoubtedly bring new challenges to China's international economic environment.
Therefore, by building an independent payment system, diversifying market strategies, strengthening regional economic cooperation, expanding domestic demand, and promoting industrial upgrading and technological innovation, China is not only capable of meeting this challenge, but can also take this opportunity to promote the adjustment and optimization of the economic structure to achieve more sustainable and stable development.
In the process, China's international status and influence will also be further enhanced.
Source: [Tengdao Tendata] WeChat public account