U.S. ready to sanction Chinese banks if they aid Russia’s war machine, Yellen says

The
United
States
is
prepared
to

sanction
Chinese
banks
and
companies,
as
well
as
Beijing’s
leadership,
if
they
assist
Russia’s
armed
forces
with

the
invasion
of
Ukraine,
U.S.
Treasury
Secretary

Janet
Yellen
said
Monday.

“We
stand
ready
to
act
if
we
see
significant
violations,
especially
by
financial
institutions,”
Yellen
said
in
an
interview
with
CNBC’s
Sara
Eisen
in
Beijing. “Anything
that
involves
aiding
Russia’s
military
in
their
brutal
war
against
Ukraine
is
unacceptable
to
us
and
we
have
the
ability
to
sanction
it.”

President

Joe
Biden
issued
a
new

executive
order
in
December
that
vested
the
Treasury
secretary
with
the
authority
to
sanction
financial
institutions
that
aided
Russia’s
military-industrial
complex.

Yellen
said
the
Treasury
Department
has “not
used
this
tool
yet.”

China
is “entitled”
to
have
a
relationship
with
Russia,
she
said,
noting
that
much
of
the
trade
between
the
two
countries
is
seen
by
the
U.S.
as
nonproblematic.
But
the
provision
of
military
aid
from
Beijing
to
Moscow
could
trigger
sanctions.

Yellen
has
been
in
China
for
several
days
already,
meeting
with
officials
including
her
counterpart,
Vice
Premier
He
Lifeng.
The
Treasury
secretary
arrived
in
the
city
of
Guangzhou
on
Thursday
and
traveled
to
Beijing
over
the
weekend.
She
is
scheduled
to
depart
for
Washington
on
Tuesday.

Yellen
was
tasked
with
delivering
a
tough
economic
message
on
the
visit,
one
that
placed
U.S.
interests
first
while
also
seeking
to
stabilize
the
fraught
diplomatic
relationship
between
the
world’s
two
remaining
superpowers.

Yellen
raised
U.S.
concerns
about
Chinese
overcapacity
in
the
green
energy
industry
like
solar
panels,
electric
vehicles
and
lithium-ion
batteries.

Washington
alleges
that
Chinese
government
subsidies
for
these
products
have
vastly
outpaced
its
domestic
demand
for
them.
If
Chinese
manufacturers
can’t
find
buyers
for
their
green
energy
infrastructure
at
home,
they
might
choose
to
dump
their
cheaper
surplus
products
onto
global
markets,
and
price
out
other
companies.

Chinese

state
media
and

officials
have
publicly
denied
this,
though
Yellen
said
that
in
her
meetings,
officials “understood
that
this
is
something
that’s
very
important
to
the
U.S.”

Yellen
did
not
rule
out
the
possibility
of
higher

U.S.
tariffs
on
Chinese
imports,
if
China
failed
to
address
these
concerns.

The
overcapacity
issue
is
among
the
many
trade
tensions
that
have
characterized
the
U.S.-China
relationship
in
recent
years.

Former
President

Donald
Trump‘s
initial
round
of
tariffs
in
2017
effectively
put
economic
and
trade
cooperation
on
ice
for
several
years.
Biden
has
maintained
many
of
those
tariffs
throughout
his
first
term
and
has
threatened
to
raise
some.

Biden
met
with
Chinese
President

Xi
Jinping
in
California
last
November
in
an
effort
to
thaw
relations
and
reestablish
high-level
communications
between
the
two
governments.

“That’s
what
we’re
trying
to
do,”
said
Yellen. “I
feel
our
relationship
in
this
economic
sphere
is
in
a
much
better
place”
than
it
was
a
year
ago,
she
said.