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Tuesday, Oct 20, 2020

US sanctions: economist Yu Yongding flags risk of Chinese bank assets being seized overseas

US sanctions: economist Yu Yongding flags risk of Chinese bank assets being seized overseas

Financial sanctions could come in any form, so Beijing must be prepared for worst-case scenario, says Yu Yongding, a former adviser to China’s central bank. A precedent was set in 2012 when Bank of Kunlun was cut off from the dollar payment system, suffocating its cross-border business
If push comes to shove in their financial row, the United States could not only sanction Chinese banks, but also seize overseas Chinese assets, a prominent Beijing adviser warned on Wednesday.

Yu Yongding, a senior fellow with the Chinese Academy of Social Sciences, a government think tank, said at a forum organised by The Beijing News that one possible scenario would be the US imposing sanctions on Chinese banks, as it did in 2012 to Bank of Kunlun, a regional Chinese lender backed by China’s state-owned oil company, for financing deals with Iran.

However, barring Chinese banks from dealing with the US financial system is only one of many ways that the US could inflict pain on China in the financial realm, said Yu, a former adviser to China’s central bank.
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