Russia Turns to Barter With China to Skirt Sanctions

Old-fashioned barter is making a comeback in Russia’s foreign trade for the first time since the 1990s, as companies trade wheat for Chinese cars and flax seeds for construction materials in a bid to dodge Western sanctions, Reuters reported.

Sanctions against Russia's war effort have compelled it to adopt barter and raised concerns about secondary sanctions.

The shift underscores how the Ukraine war has upended trade relations for the world’s top commodity exporter, more than three decades after post-Soviet Russia integrated into the global economy.

The U.S., EU, and allies have imposed over 25,000 sanctions on Russia since its 2022 invasion of Ukraine and the earlier 2014 annexation of Crimea.

Washington has also slapped tariffs on India for its oil trade with Russia.

President Vladimir Putin insists Russia’s economy has defied expectations, growing faster than G7 economies over the past two years. But signs of strain are mounting: the central bank says Russia is now technically in recession, while inflation remains elevated.

Key sanctions — notably the cutoff of Russian banks from the SWIFT system in 2022 and U.S. warnings to Chinese lenders against aiding Moscow’s war effort — have forced Russia to embrace barter and raised fears of secondary sanctions.