Business mogul Mark Cuban recently shared his perspective on the escalating trade tensions between China and Russia, in the light of U.S. sanctions on Moscow.
What Happened: On Sunday, Cuban took to X to express his views on the ongoing trade issues between China and Russia. The “Shark Tank” fame billionaire shared a Newsweek article that touched on the trade between the two countries.
Russian companies are facing difficulties as Chinese banks raise the yuan-ruble exchange rate, charging a premium over the Russian central bank’s rate, according to the report. With the ruble weakened by Western sanctions and reduced export revenue, Russia's reliance on the yuan for trade with China has made it vulnerable to exploitation by foreign banks. Some Chinese banks have increased their rates, while delays and rejections of Russian payments are growing, further complicating trade between the two countries amid ongoing sanctions.
Cuban said, “Sanctions can [be] better than tariffs, without the tax on American consumers.”
Moreover, the U.S. and European Union have raised concerns over China’s support for Russia’s military, which they believe is contributing to the conflict in Ukraine and posing a global security threat. This has led to heightened tensions between the nations.
Why It Matters: This is not the first time Cuban made remarks regarding tariffs. Recently he raised concerns about the impact of Donald Trump’s proposed tariffs, particularly how they would increase consumer costs, using Walmart as an example. Economic experts have warned that these tariffs could lead to inflation and harm consumers.
Cuban’s comments come in the backdrop of recent reports that global banks are returning 80% of yuan transfers, causing significant payment delays for Russian businesses. This has been linked to secondary sanctions implemented by the U.S. in December, aimed at financial institutions assisting Russia in evading sanctions.
China and Russia have also been contemplating the use of barter trading systems to bypass U.S. banking surveillance, as reported by Benzinga. This move is seen as an effort to avoid payment issues, reduce oversight of Western regulators, and mitigate currency risk.
Furthermore, the U.S. faced backlash from China for adding several Chinese entities to its export control list, in an attempt to restrict Russia’s access to advanced U.S., technology. This move has been criticized by China as undermining the international trade order and rules, and disrupting the security and stability of global industrial and supply chains.
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This story was generated using Benzinga Neuro and edited by Shivdeep Dhaliwal
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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