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UAE banks block Russian payments for electronics supplies from China

Natasha Kumar By Natasha Kumar Aug29,2024

UAE banks block Russian payments for electronics supplies from China

Illustrative photo from open sources

Due to the risk of secondary sanctions, banks in the United Arab Emirates (UAE) have begun blocking Russian payments for supplies of Chinese electronics.

This was reported by Radio Liberty with reference to "Kommersant".

The article cites a representative of one of the electronics distributors, who noted that banks do not process payments if we are talking about equipment from other countries that does not come to the UAE.

"Radio Liberty" points out that Russian organizations used banks in the UAE as a way to transfer funds for Chinese electronics, but the goods themselves were immediately sent to Russia. For example, such a scheme helped to "deliver" 10-20% of all laptops to the Russian Federation. In addition, the bank commission in the UAE was only 1-3%, which also attracted Russian companies.

Payments from Russians began to be blocked about a month ago – it was the Chinese side that initiated it. In particular, Chinese banks have begun to request data from Dubai-based organizations on the origin of funds received by them, as well as a customs declaration on what exactly was taken out of the country.

One source emphasized that under another scheme for making payments for Chinese equipment, the commission is slightly higher, which will affect the growth in the cost of electronic components – a 5% increase is predicted by December.

“After the United States expanded the parameters for introducing secondary sanctions in June, making payments between China and Russia, even in yuan, has become virtually impossible. The share of refusals for payments from Russia through banks in Central Asian countries increased by 30% in July 2024,” the report concludes.

Prepared by: Sergey Daga

Natasha Kumar

By Natasha Kumar

Natasha Kumar has been a reporter on the news desk since 2018. Before that she wrote about young adolescence and family dynamics for Styles and was the legal affairs correspondent for the Metro desk. Before joining The Times Hub, Natasha Kumar worked as a staff writer at the Village Voice and a freelancer for Newsday, The Wall Street Journal, GQ and Mirabella. To get in touch, contact me through my natasha@thetimeshub.in 1-800-268-7116

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