China retaliates against two European banks, enforcing measures in response to recently implemented sanctions from the European Union

China retaliates against two European banks, enforcing measures in response to recently implemented sanctions from the European Union

In a move that highlights growing geopolitical friction, China has imposed sanctions on two Lithuanian banks - UAB Urbo Bankas and AB Mano Bankas - in retaliation for the European Union's sanctions against two Chinese banks linked to Russia. This action bans Chinese agencies and individuals from doing business with these Lithuanian banks, aiming to counter EU measures that targeted two Chinese banks accused of aiding Russia's sanctions evasion amid the Ukraine conflict.

The EU had sanctioned the Chinese financial institutions Heihe Rural Commercial Bank and Heilongjiang Suifenhe Rural Commercial Bank as part of its package to hinder Russia's war efforts, claiming these banks facilitated digital asset exchanges that undermined EU sanctions. In response, China described the EU's actions as damaging to China-EU economic and trade relations and called on the EU to cease what it termed a "wrong practice."

The retaliation comes amid broader tensions between China and the EU, with China seeking to protect its interests and criticize the EU's stance on the Ukraine conflict, while the EU defends its sanctions as essential to limiting Russia's war resources. Despite the sanctions, the Lithuanian banks reportedly do not operate directly in China, making the Chinese sanctions symbolic but indicative of rising geopolitical friction.

The Ministry of Commerce in China called on the EU to "correct wrongdoings" and stop harming China's interests and undermining China-EU cooperation. The EU, on the other hand, has maintained its stance on the Ukraine crisis, with the European Commission President Ursula von der Leyen stating that trade ties have reached a "clear inflection point" after a summit with Chinese leaders. The discussions during the summit in Beijing focused on commerce, but the EU also pressed China to discourage Russia in its war against Ukraine.

China, however, maintains its stance on seeking a political settlement for the Ukraine crisis, despite sharing a "no limits" partnership with Russia. The Ministry of Commerce in China also expressed hope that the EU will maintain long-term good cooperative relations with China in the fields of economy, trade, and finance.

This latest development underscores the complex and evolving relationship between China and the EU, as both parties navigate geopolitical challenges and strive to protect their respective interests. As tensions continue to rise, it remains to be seen how this situation will unfold in the days and weeks ahead.

References:

1. BBC News
2. Reuters
3. CNBC
4. The Guardian
5. South China Morning Post

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