US says it could act against China firms, banks over Russian war support By Reuters

By David Brunnstrom

WASHINGTON, Virginia (Reuters) -The United States and other nations could take steps against Chinese firms and financial institutions over Beijing’s backing for the Russian war against Ukraine, a top U.S. official said on Friday.

The Biden administration has stepped up warnings about China’s backing for Moscow and issued an executive order in December that threatened punitive measures against financial institutions helping Russia skirt Western sanctions.

„I think where we are primarily focused are on Chinese companies that have been involved in a systematic way in supporting Russia,” U.S. Deputy Secretary of State Kurt Campbell told reporters near the Virginia town of Washington when asked if the Chinese leadership and banks could be targeted.

„We’ve also looked closely at financial institutions.”

Earlier this week Campbell said there was an urgent need for European and NATO countries to send a collective message of concern to China.

„There will be steps that are taken, not just by the United States, but other countries, signaling our profound displeasure about what China is seeking to do in its relationship with Russia on the battlefield in Ukraine,” he said on Friday.

Campbell met China’s Vice Foreign Minister Ma Zhaoxu on Thursday and raised U.S. concerns about Beijing’s support to Russia’s defense industrial base undermining European security, according to a State Department readout.

The department’s second ranked official spoke on Friday after a meeting with senior officials from Japan and South Korea to prepare the way for a trilateral leaders’ summit later this year. He said the date for that meeting wasn’t yet set, but that it was of the „highest priority.”

Campbell welcomed „renewed diplomacy” between China, Japan and South Korea, after leaders from the three countries met on Monday for the first time in four years. The two U.S. allies had offered a „very deep and sincere debrief” on their three-way meeting with China, he said.

He also commended Philippines President Ferdinand Marcos Jr for a speech he gave at the Shangri-La Dialogue defense summit in Singapore, where the Asian leader alluded to „illegal, coercive and aggressive” actions by China in disputed waters of the South China Sea.

Campbell called the speech strong and purposeful, but he would not directly answer a reporter’s question on whether any mishap involving China’s Coast Guard that resulted in a Philippines service member being killed would trigger Washington’s mutual defense treaty with the Philippines.

Encounters between the Philippines and China in Asia’s most contested waters have grown more tense and frequent during the past year as Beijing presses its claims to shoals in waters that Manila says are well within its exclusive economic zone.

„We fundamentally believe that the United States and the Philippines are moving towards a closer set of relations in which we will be able to deepen our security partnership,” Campbell said.