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U.S. Adds Chinese, Russian Companies To MEU “Alternative Sanctions” List, Pushing Them Closer Together

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U.S. Adds Chinese, Russian Companies To MEU "Alternative Sanctions" List, Pushing Them Closer Together

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On December 21st, the US Department of Commerce published the names of 103 entities, which includes 58 Chinese and 45 Russian companies.

They are included in a new ‘Military End User’ (MEU) List, which is part of the Export Administration Regulations (EAR).

The U.S. Government has determined that these companies are ‘military end users’ for purposes of the ‘military end user’ control in the EAR that applies to specified items for exports, reexports, or transfers (in-country) to the China, Russia, and Venezuela when such items are destined for a prohibited ‘military end user.’

“This action establishes a new process to designate military end users on the MEU List to assist exporters in screening their customers for military end users,” said Commerce Secretary Wilbur Ross.  “The Department recognizes the importance of leveraging its partnerships with U.S. and global companies to combat efforts by China and Russia to divert U.S. technology for their destabilizing military programs, including by highlighting red flag indicators such as those related to Communist Chinese military companies identified by the Department of Defense.”

This is essentially an alternative way to sanction Russia, China, Venezuela, Iran and others.

The MEU List informs exporters, reexporters, and transferors that a license will be required to export, reexport, or transfer (in-country) designated items to listed entities. The U.S. Government has determined that these entities represent an unacceptable risk of use in or diversion to a ‘military end use’ or ‘military end user’ in China, Russia, or Venezuela.

However, it is likely that this “alternative sanctioning” will also backfire and push Russia, China, Iran and others to cooperate even more economically and could potentially further isolate the US.

In relation to the new developments, Iran is making moves to further increase economic relations with Russia.

Iranian Oil Minister Bizhan Namdar Zangane said that Iran views Russia as a strategic partner and welcomes Russian investments in the country’s oil industry.

According to the minister, one of the topics discussed at the meeting with Russian Deputy Prime Minister Alexander Novak was the topic of world oil markets.

The meeting was also attended by Energy Minister Nikolai Shulginov. Given the serious cooperation in OPEC +, the views on this issue of the two countries turned out to be very close. Therefore, cooperation with Russian companies in the field of oil, gas and equipment production will continue.

Russia and Iran are currently working on a wide range of issues of trade and economic cooperation. In 2020, it became even more active and meaningful, Novak previously reported.

When it comes to drilling, the strategic alliance of Iran and Russia (two first places in gas reserves) is a real challenge for the mega-regulator of the planet’s energy and financial market. Gas is the future of world energy, the main product of the global market in the future.

If China and India are added to this alliance (in fact, this process is taking place within the SCO), then this will lead to the formation of the second center of world power terms of economic, political, demographic and military resources. It’s not even worth talking about its attractiveness for the countries of Africa, the Middle East and Latin America (Venezuela, at least).

Turning this into reality is quite simple, it just needs for China, Russia and Co. to develop their own system of intercountry mutual settlements and risk insurance. Simply put, create a sustainable enough monetary system.

The presence of Shulginov at the meeting is a positive thing. There is a soft transfer of powers within the framework of the existing structure. Shulginov’s functionality and scope of powers will only grow.

Iran, Turkey, and even India (despite its tensions with China) will also and very likely be happy to join such a system.

This is likely showing that there are already mechanisms that will pre-emptively nullify much of the United States’ attempt at unilateral economic pressure.

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