Because of the war in Ukraine, Russia was sanctioned by western countries. With the conflict intensifying, the sanction means constantly increase. Among these sanction, the most conspicuous is that Russia is cut off from the international settlement system SWIFT. That means Russia can’t use USD and Euro in trading with other countries.
After Apple, AMD, Amazon, Boeing and Intel, credit card company Visa and MasterCard declared stop the business in Russia on March 6th. That means former issued card can’t use in foreign countries. This cause big problem to Russian banks and people travelling abroad.
However, Russia takes several measures to deal with the sanction. As the reply, Sber bank, Alfa bank, Tinkoff bank and many other banks declare to turn to Chinese UnionPay and ready to issue card that support UnionPay. UnionPay covers 180 countries offline and 200 countries online, so there will not bad effect on the usage with UnionPay. Besides banks issuing UnionPay card, Fesco Transport Group, Gazprom and many other companies express that they will settle with CNY. With the support of Chinese currency system, the pressure by the sanction will remit a lot. According to the report, thousands of Russia people in Thailand have used UnionPay.
In the meantime, Turkey president Mr. Erdogan declared that the trade between Russia and Turkey can settle with Rouble, Euro, gold or CNY. Under the huge pressure from the sanction, such words from Turkey no doubt support Russia greatly. According to the data, the bilateral trade amount between Turkey and Russia is 34.76 billion, increasing 59.14% on year-on-year basis. Actually, the trade between Turkey and Russia increases 10% annually in recent years. What’s more, it will be over 100 billion in the future years.
Besides, other countries like Pakistan and North Korea express that will not cut off the trading and contact with Russia.
With these support from China, Turkey and other countries, the economic and foreign trade pressure will remit a lot. Of course, the trading with Russia will be more close in the future. It’s an opportunity for foreign trade companies like OrientFlex. We should grasp it and keep close relationship with our Russian clients.