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China-led development bank halts business in Russia, Belarus
Move is latest sign of the limits of Beijing’s support for Moscow as it faces sanctions and censure over war in Ukraine.
A China-led development bank has suspended all business with Russia and Belarus, a possible sign of the limits of Beijing’s support for Moscow as it faces sanctions and censure over its war in Ukraine.
The Asian Infrastructure Investment Bank (AIIB) said it put all activities related to the two countries on hold in light of “the evolving economic and financial situation”.
“Under these circumstances, and in the best interests of the Bank, Management has decided that all activities relating to Russia and Belarus are on hold and under review,” the Beijing-based institution said in a statement on Thursday.
The multilateral development bank, which has 105 members worldwide, did not elaborate on the reason for its decision, but extended “its thoughts and sympathy to everyone affected”.
“Our hearts go out to all who are suffering,” the bank said.
The announcement comes after several Chinese state-owned financial institutions, including the Bank of China, ceased financing for deals involving Russian commodities.
Gary Ng, a senior economist at Natixis in Hong Kong, said the AIIB’s move is “symbolic” as the bank has been financing just two projects in Russia to the tune of $800m and none in Belarus, which is supporting the Russian war effort.
“Even though most of the cross-border lending from China to Russia may take place with policy banks, this is still another example that China may not unconditionally support Russia as it would be weighing its own benefits and costs from any geopolitical move,” Ng told Al Jazeera.
“The retreat of the AIIB shows the pressure of global financial sanctions on Russia has become more apparent in supranational organisations,” Ng added.
