Financial Times: China's biggest banks have quadrupled their investments in Russia since start of full-scale war

Between February 2022 and March 2023, China’s four largest banks increased their total investments in the Russian banking sector more than fourfold, from $2.2 billion to $9.7 billion, The Financial Times reported on Monday, citing data from experts at the Kyiv School of Economics.

According to the experts, the trend is both part of Beijing’s efforts to promote the yuan as a global alternative to the U.S. dollar and part of Russia’s transition to using the yuan as a reserve currency.

“The loans by Chinese banks to Russian banks and credit institutions, which are for the most part a case of the yuan taking the place of dollars and euros, show the sanctions are doing their job,” said Kyiv School of Economics deputy development director Andrii Onopriienko.

The Financial Times noted that before the start of the full-scale war, more than 60 percent of payments for Russian exports were made in dollars and euros, while the yuan accounted for less than one percent. But since the war began, the share of payments in dollars and euros, which the Russian authorities consider “toxic,” has been less than 50 percent, while the yuan’s share has reached 16 percent, according to data from Russia’s Central Bank.