The United States Ambassador was summoned to China for the purpose of negotiating recent military sanctions. The move comes after China’s decision to purchase S-400 Surface-to-Air Missiles and Sukhoi SU-35 Jets from Russia as part of a trade deal to increase its military arsenal. This transaction was viewed by the United States moved was in violation of the sanctions that were placed upon Russia due to the recent actions in Ukraine and concerns surrounding interference with the 2016 elections. These actions in the trade dispute have urged China to advise the United States to “strongly reconsider” their actions and drop the sanctions.
The actions of the United States have drawn considerable criticism from China. A representative of the Defence Ministry of China called the United States’ actions “a flagrant breach of basic rules of international relations” and a “stark show of hegemonism.” Vladamir Putin’s Dmitry Peskov, a Russian Diplomat, was also critical of the actions taken by the United States. In a recent statement, he called the sanctions “unfair competition, dishonest competition, an attempt to use non-market methods that run counter to norms and principles of international trade to squeeze the main competitor of U.S. makers out of the markets.”
While these Sanctions are ultimately targeting Russia to curb the spread of military armaments, the fact that the Sanctions have since been expanded to target a third party such as China could have serious impacts on trade going forward. While the sanctions only prohibit the Equipment Development Department (EED) from making purchases within the United States, the punishment of a third-party country could potentially lead to a dangerous precedent that could potentially punish state actors unfairly through unknowingly interacting with blacklisted individuals or parties. Especially with nations such as India potentially looking to make purchases from Russian arms, which would severely hamper India’s trade given the United States is it’s second largest trading partner.
Sanctions were put into place on Thursday as part of the Countering Americas Adversaries Through Sanctions Act (CAATSA) of 2017. Under this law, the United States blacklisted as many as 72 individuals that were found to be suspicious in the United States. Whilst being placed on this blacklist doesn’t cause sanctions, individuals or countries found to have dealings with those who have been placed onto the blacklist will be open to facing expanded sanctions such as what has currently befallen China. This marks the first time that the sanctions have been moved to a third-party facing penalty when the original CAATSA only placed bans on North Korea, Iran, and Russia.
By expanding the Sanctions to punish third-party actors, the United States could end up facing scrutiny and backlash due to the increased tariffs that are being placed on goods going into the United States. This, in turn, could turn some nations off from wanting to trade with the United States or even lead to situations where a state is unjustly sanctioned simply for trading with one of the blacklisted individuals or nations. While it is understandable that they wish to curb troubling behaviour by specific state actors, punishing potential trade partners such as India for actions that are primarily the fault of others is a tenuous path that could alienate the United States from potential emerging trade partners and make others cautious of dealing with them in the future.
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