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Xi delivers devastating blow to Putin as China pulls plug on sanctions-busting deal

After pulling the plug on a sanctions-busting agreement, XI JINPING has dealt a catastrophic blow to Vladimir Putin and the Russian economy.

The West has slapped Russia with a slew of harsh economic sanctions in the aftermath of its invasion of Ukraine. The economic sanctions were aimed at a variety of sectors, including banking and big Russian banks. The Central Bank of Russia (CBR) has had its assets blocked in the United States, the United Kingdom, Canada, and the European Union, as the West tries to prevent it from accessing its $630 billion (£470 billion) in foreign currency reserves.

Sberbank and Alfabank, two of Russia's major banks, have also been singled out by the US, which has put full-blocking penalties on them in recent weeks.

As a result of the economic sanctions imposed on the Kremlin, several Western financial institutions have abandoned the country.

Last month, Visa and Mastercard (MC) halted operations in Russia, rendering Russians unable to make any payments outside of the nation using the two firms' cards.

To get around the prohibition, the Kremlin sought to reach an agreement with China's UnionPay system as an alternative to Visa and MasterCard.

UnionPay, on the other hand, abruptly ended talks with Sberbank and other Russian financial firms on the West's economic blacklist yesterday.

The Chinese enterprise is believed to be concerned that cooperating with Moscow will result in secondary sanctions from Western countries.

Vladimir Putin has been dealt a serious blow by Xi Jinping (Image: Getty)

The Kremlin intended to reach an agreement with China (Image: Getty)

"The project [to issue UnionPay cards] is temporarily on hold," a banking source told, a Russian news outlet.

"They don't confirm it's linked to sanctions, but they say it's on hold until further instructions."

UnionPay, which was established in March 2002, offers bank card services comparable to those offered by Visa and MasterCard.

It surpassed Visa and MasterCard in total value of payments made by consumers in 2015, becoming the world's largest card payment processing company.

According to Retail Banking Research, the company will account for 1% of Russian bank cards in 2020.

Moscow and Beijing have been working to strengthen their ties. (Photo courtesy of Getty)

Ukraine's conflict (Photo courtesy of Getty)

Following the implementation of sanctions by the West, demand for UnionPay cards increased tenfold.

Russians with UnionPay cards, on the other hand, have recently reported issues using them in the United States, Israel, Europe, Asia, and the Middle East.

As a means of countering Western geopolitical influence, Moscow and Beijing have sought even closer ties.

On the eve of Moscow's invasion of Ukraine in February, the two countries declared a "no-limits" relationship.

They also agreed to increase trade to $250 billion by 2024. Last year, China contributed for over $147 billion (£100 billion) of Russia's total trade.

The EU, on the other hand, continues to be Russia's most important commercial partner. Last year, total trade between the two countries was nearly twice as much as China's with Russia.

Shell is still attempting to sell off its part in a big Russian gas project.

To comply with sanctions, the corporation has stated that it will cease relations with Russia.

The Chinese state-run enterprises Cnooc, CNPC, and Sinopec are said to be in talks with the energy giant about its 27.5 percent stake in the Sakhalin-2 liquefied natural gas venture.

Shell warned that their decision would have a negative impact on its profitability, estimating that it would cost the company up to $5 billion (£3.8 billion).

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