The West “will not be indifferent” to attempts by other nations to help Russia circumvent sanctions on its economy, Treasury Secretary Janet Yellen said Wednesday at a think tank event in a veiled warning to China.
The veteran Biden administration economist gave her most accurate assessment yet of what she described as countries “sitting on the fence” in Vladimir Putin’s war on Ukraine, a conflict that, according to her, has “redrawn the contours of global economic prospects” and also upended decades of UN-centered international principles.
In his opening address to the Atlantic Council, Yellen said countries adopting a non-committal attitude to events in Europe “may see an opportunity to be won by preserving their relationship with Russia and filling the void left by others”. Such a position would be “short-sighted”, she said, citing the challenge to the existing security and economic order.
“And let’s be clear, the unified coalition of sanctioning countries will not be indifferent to actions that undermine the sanctions we have put in place,” the Treasury Department chief said, without naming China. Washington has issued similar warnings in the past, in more direct terms.
In the 50 days since the start of the war, Beijing has continued to express strong opposition to sanctions, a punishment it says will ripple through the economies of developing countries, including China, which counted on a strong post-pandemic rebound. While Chinese officials insist the country will not materially aid Russia’s war effort, they have pledged to pursue mutually beneficial trade and have also offered the Kremlin significant political cover at the UN. and elsewhere.
“China recently affirmed a special relationship with Russia. I fervently hope that China will do something positive with this relationship and help end this war,” Yellen said. The US official said Beijing’s choices going forward could affect its long-term trade relationship with key Western partners, most of whom had welcomed China’s WTO membership but were now finding flaws in its non-market practices.
“The world’s attitude towards China and its willingness to embrace greater economic integration may well be affected by China’s reaction to our call for resolute action against Russia,” she said, suggesting that anything short of joining the ongoing sanctions effort could see Beijing fail to win back trust in the West. She noted that economic and national security considerations would be “increasingly difficult” to separate in the future.
“China has long claimed to hold sacrosanct international principles, including those enshrined in the UN Charter regarding sovereignty and territorial integrity,” Yellen said. “China cannot expect the global community to uphold its calls for the principles of sovereignty and territorial integrity in the future if it fails to uphold those principles now when it matters.”
It was a pointed reference to China’s “historic claim” to territories in the East and South China Seas, and to Taiwan, which it says is an internal matter. Others, like Singaporean Prime Minister Lee Hsien Loong, have noted this same contradiction in China’s refusal to condemn Russia’s actions.
At a regular press conference on Thursday, Chinese Foreign Ministry spokesman Zhao Lijian suggested that Yellen was misrepresenting China’s official stance on the war. Ukraine’s security must be respected, but so is Russia’s, he said.
“China has always insisted that the sovereignty and territorial integrity of all countries should be respected and safeguarded,” he said, “and we believe there should be no double standards. in the management of international relations”.
“China’s position is in line with the positions and desires of most countries. We oppose groundless accusations and suspicions against China, let alone any pressure and coercion. Time will ultimately prove that China’s position China is on the right side of history,” he said. .
In her remarks, Secretary Yellen said the West’s united action against Russia has proven “swift and sweeping sanctions can have tremendous force.” The Russian economy has been punished by the United States and “more than 30 countries, representing well over half of the global economy”, she said.
“Rest assured, until Putin ends his odious war of choice, the Biden administration will work with our partners to push Russia further into economic, financial and strategic isolation. The Kremlin will be forced to choose between supporting its economy or funding the continuation of Putin’s brutal war,” Yellen said.
“When Russia made the decision to invade Ukraine, it predestined an exit from the global financial system. Russian leaders knew that we would impose severe sanctions, even if they underestimated the breadth, depth and coordination of actions that the United States and its allies would take,” she concluded.
Since Russia’s invasion of Ukraine on February 24, the West has harshly criticized Putin, his government and the Russian oligarchs. The measures have included a complete ban on transactions in dollars, euros or pounds, with the country’s central bank and other major institutions cut off from assets in the US and EU, among others.
Elsewhere, holders of key technologies and regional financial centers in the East – South Korea, Japan, Taiwan and Singapore – agreed to export controls and financial sanctions, in decisions likely to impact Russia’s ability to conduct mid to long-term modern warfare.
Newsweek contacted the Russian Foreign Ministry for comment.