‘Treasury has consistently warned that companies will face significant consequences for providing material support for Russia’s war,’ Janet Yellen said.
The Biden administration is sanctioning nine Chinese companies for their role in supporting Russia during its ongoing war in Ukraine.
The companies directly worked in the Russian technology sector or provided support to Russia’s defense sector, according to a statement from the Commerce Department.
The China-based companies are listed among some 300 other entities issued with new sanctions on May 1 for their role in supporting Russia’s war effort.
“Today’s actions will further disrupt and degrade Russia’s war efforts by going after its military-industrial base and the evasion networks that help supply it,” Treasury Secretary Janet Yellen said in an associated statement.
“Treasury has consistently warned that companies will face significant consequences for providing material support for Russia’s war, and the U.S. is imposing them today on almost 300 targets.”
Notable among the sanctioned companies are the Zhongcheng Heavy Equipment Defense Technology Group (ZHE) and Shvabe Opto-Electronics (Shvabe Opto).
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ZHE is a China-based defense company that produces and sells weapons, ammunition, unmanned aerial vehicles, and other defense equipment. The Commerce Department said that ZHE “materially assisted, sponsored, or provided financial, material, or technological support” to blacklisted entities within Russia or the private military company Wagner, which operates in Ukraine, Syria, and throughout Africa.
Shvabe Opto, meanwhile, “made thousands of shipments” to its Russia-based parent company that develops combat aircraft and naval vessels, “including hundreds of shipments of foreign-origin microelectronics.”
Following the release of the new sanctions package, Director of National Intelligence Avril Haines testified to Congress that China’s communist regime was developing relations with Russia and Iran in an attempt to subvert the prevailing international order, including through defense support.
The “major authoritarian nations,” she said, were “actively working to undermine the rules-based order and the open international system.”
“China is working to develop its own form of multilateralism while deepening its relationship with Russia and Iran in particular,” Ms. Haines said during a May 2 Senate Armed Services Committee hearing.
“China’s provision of dual use components and material to Russia’s defense industry is one of several factors that tilted the momentum on the battlefield in Ukraine in Moscow’s favor, while also accelerating a reconstitution of Russia’s military strength after their extraordinarily costly invasion.”
To that end, an official statement by the Commerce Department expressed concern that China was leading a cohort of authoritarian nations to effectively prop up Russia’s economy and enable it to continue waging war in Ukraine.
“The United States, along with many international partners, is particularly concerned about entities based in the People’s Republic of China (PRC) and other third countries that provide critical inputs to Russia’s military-industrial base,” the statement said. “This support enables Russia to continue its war against Ukraine and poses a significant threat to international security.”
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