Banks in the United Arab Emirates (UAE) have been rejecting payments from Russian companies for electronic components and consumer electronics from China since the beginning of August, with the payment chain disrupted due to the risks of secondary sanctions, according to Kommersant, citing market participants.

Transactions are being declined when the purchased goods do not enter the UAE. Russian organizations used companies in the UAE as a way to transfer money to Chinese firms, but the goods were shipped directly to Russia.

Payments through the UAE were advantageous due to low commissions. According to the publication, the blocking is being initiated by the Chinese side.

“About 10-20% of all laptops in Russia are supplied through channels in the UAE, and for other categories of goods, the share can reach 30%,” said one market participant.

Analysts believe that by the end of 2024, Russia may face a shortage of consumer electronics and components that were paid for through these countries, with prices potentially rising by 5-10%.

Earlier, it was reported that Chinese companies are increasingly refusing to supply goods directly to Russia due to concerns over secondary sanctions from the United States. Additionally, Chinese banks have been returning payments from Russia for already delivered goods.

Last updated on September 13th, 2024 at 09:18 pm