Page 206 - RusRPTAug24

Difficulties with servicing payments to China for Russian companies began after Joe Biden signed an executive order in December 2023 threatening secondary sanctions on third-party banks that help Russia circumvent sanctions. Since then, the situation has been steadily worsening: at first, the timing of payments increased, and compliance became more complicated, then the largest Chinese banks stopped accepting payments, first from the sanctioned ones (that is, almost all the largest), and then from all Russian banks in general.
As a result, in the first four months of 2024, imports from China to Russia fell by almost 2% - despite the fact that in 2023 they grew by 46.9%, The Bell recently calculated. Monthly dynamics showed that the situation was gradually worsening: in January-February, imports from China to Russia increased by 12.5%, in March it decreased by 14.2%, and in April - by 13%.
Russian companies importing from China had to switch to working with second-tier banks. But with them everything is not so simple. On June 12, when the Moscow Exchange came under sanctions, the US Treasury at the same time significantly simplified the introduction of secondary sanctions against banks - previously, for this it was necessary to prove that they worked with companies related to the military-industrial complex, but now this concept has been expanded almost to the size of the entire Russian economy with some exceptions. The next day, US Treasury Secretary Janet Yellen threatened small Chinese banks that these sanctions could be used against them.
In the first half of 2024, government procurement of new and used passenger cars and light commercial vehicles (LCV) of Russian manufacture showed significant growth. This follows from the data of the public part of government procurement, which was collected for Vedomosti by the Tenderplan search and analytical system. Competitions were analyzed under both Federal Law 44 (state and municipal government structures) and Federal Law 223 (procurements by companies with state participation).
The leader in terms of public procurement in monetary terms in the first half of the year was the products of the GAZ Group. A total of 1,145 tenders worth 24 billion rubles were awarded, which is 2.7 times more than a year earlier. In 2nd place is UAZ: 694 tenders worth 6.4 billion rubles were awarded for SUVs from Ulyanovsk, which is more than 2 times more than the figures for January-June 2023. AvtoVAZ products accounted for 1.5 times more public funds than a year earlier: 1,381 tenders worth 5.8 billion rubles were held during the reporting period.
Cars of other Russian manufacturers were much less popular with officials and state-owned companies. In particular, 271 tenders worth 1.2 billion rubles were held for Haval cars (the plant of this Chinese brand is located in the Tula
206 RUSSIA Country Report August 2024 www.intellinews.com