According to the President's Export Council, since 1993, the US has imposed more than 40 economic sanctions on 36 countries.

This last sanctions on Russia will come back to harm US badly. This reminds me of the idiom "the last straw that broke the camel's back".

US President Joe Biden imposed economic sanctions on Russia for Ukraine invasion of 24 February. Sanctions have been imposed on Russian banks, enterprises, and oligarchs, as well as on officials and other Putin allies, by other countries, including the E.U., Japan, Canada, Australia, the U.K. and New Zealand. Russia’s central bank will be blocked from deploying its international reserves and Western airspace will be effectively closed to Russian aircraft. Tough restrictions will also be placed on the goods and services that Russian institutions and firms can purchase from the U.S., while several big brands, including Ikea, General Motors and Apple, have either closed office, paused sales, or exited the Russian market.

But perhaps the toughest measure is a ban on several Russian banks from the Society for Worldwide Interbank Financial Telecommunication (SWIFT) system. SWIFT connects more than 11,000 financial institutions in more than 200 countries and facilitates the majority of global money transfers. It’s the lubricant of international trade and finance. Without it, moving money is slower and more expensive. “This will ensure that these banks are disconnected from the international financial system and harm their ability to operate globally,” the White House said.

Russia’s efforts to limit financial links to U.S.

Russia ’s multi-year push to remove the dollar’s hold over its economy and financial markets has so far helped ease the impact of sanctions from the U.S. and its allies, even as they roll out tougher measures that could test the extent of a true de-coupling from the greenback.

The nation slashed its dollar reserves to just 16% of the central bank’s stockpile in 2021, down from more than 40% just four years prior. That’s meant aggressively hacking its holdings of U.S. Treasuries, shrinking ownership by almost 98% from a peak in 2010 and removing dollar assets from its sovereign wealth fund. 

How does the US benefit from being the reserve currency? US can print money. Having reserve currency status has both benefits such as lower exchange rate risk and greater buying power. In fact, US attacked Iraq when OPEC wanted to use Euro to sell their oil.

Under the circumstances, Russia and China must use the Chinese Yuan and digital currency to trade. As China being the factory of the world, it can easily trade with other nations using local   currencies.

How can China benefit?

Western sanctions will bring Russia and China closer together economically—and that they may even pose a threat to the U.S. dollar’s dominance of the global financial system.

Russia is the 3^rd biggest producer of oil and gas in the world. Russia is also one of the biggest wheat exporters in the world. Russia also exports many minerals including rare earths for electric vehicle batteries and computer chips manufactures. For an economy such as Russia that still relies a great deal on export revenues and on international trade more broadly, losing access to global finance is clearly a painful blow. Moscow will resort to cryptocurrencies to circumvent sanctions.

China has gone one step further with the new digital yuan. Chinese don't carry money anymore everything is held on their phone you can't walk into a shop and use paper money everything is being digitalized. It's faster easier and much more convenient.

It is the future of how transactions will be managed, modern technology and the use of 5G and what will soon become 6g has given Chinese people opportunities to do things in their lives that they have never had the opportunity to do to say nothing about being more technologically advanced than America the UK and the EU

The restrictions on Russia’s access from the Western-dominated global financial system will undoubtedly drive it into a deeper economic embrace with China, in terms of both trade and financial dependence.

China and Russia already have close economic and diplomatic ties. Russia was China’s second largest crude oil supplier last year. China is Russia’s largest buyer of coal. Putin meanwhile showed obvious rapport with China’s president, Xi Jinping, when the two leaders met recently on the side lines of the Winter Olympics in Beijing. The nations were committed to “deepening back-to-back strategic cooperation,” Xi said.

“Prior to Russia’s invasion of Ukraine, Russia was looking East and engaging in more commercial activities with China,” says Steve H. Hanke, a professor of applied economics at the Johns Hopkins University. “Cutting Russia off from the SWIFT payments system will not decide the outcome of the current conflict that is raging, but it will accelerate and cement Russia’s commercial ties with China.”

US $ devaluation: Under the circumstances, Russia has to export almost all of its products to China and happily accept the Chinese Yuan and digital currency. China is already the biggest exporter of various kind of goods in the world. With the additional facilities provided by Russia, China can increase its production for export. Buyers can use Chinese Yuan and digital currency. As a result, the US Dollar will be devalued rapidly.

The photos below are the power and gas pipelines from Russia to China.

Western sanctions will bring Russia and China closer together economically and politically. As a result, China will be the richest and most powerful nation in the world.