Chinese exporters have sharply increased prices for Russian military-industrial buyers, taking advantage of the Kremlin’s dependence on their products amid Western sanctions, according to new research. A paper from the Bank of Finland Institute for Emerging Economies (Bofit) shows that the average price of export-controlled goods shipped from China to Russia rose 87% between 2021 and 2024, compared with a 9% rise for similar goods shipped elsewhere. The study underscores how sanctions are indirectly limiting Russia’s military capabilities by inflating the cost of critical imports.
The research, cited by the Financial Times, found that while Russia has relied on Chinese suppliers to circumvent Western restrictions, the surge in costs has constrained its technological and military-industrial capacity. Senior Western sanctions officials told the Financial Times that even if China continues supplying critical goods, the sharp price increases effectively reduce how much Moscow can purchase. “If you increase the price of a good by 80 per cent, you nearly halve what they can actually buy,” one official said.
Bofit researchers Iikka Korhonen and Heli Simola focused on “machinery and mechanical appliances,” a category containing many products of strategic importance to Russia’s war effort. In several cases, they found that the rise in import values was driven by higher prices rather than increased trade flows. For instance, imports of Chinese ball bearings surged 76% in dollar terms between 2021 and 2024, even as physical volumes fell by 13%. Similar price pressures were observed for Russian imports from Turkey, where sanctions led to 25–55% higher costs compared with other exports.
Using data from 14 countries, the researchers estimated that the median price of imports subject to export controls rose 75% over the three-year period, while non-restricted goods remained largely unchanged. They also noted that the impact of sanctions on prices is strengthening, as stricter enforcement allows exporters to demand higher premiums from Russian buyers.
The Kremlin continues to prioritize relief from sanctions, with recent U.S.-Russia proposals indicating that sanctions could be lifted in stages, on a case-by-case basis. China has repeatedly denied supplying lethal weaponry to Moscow and opposes unilateral sanctions that interfere with trade between Chinese and Russian companies, even as its firms benefit from higher prices for restricted goods.
The study illustrates how global trade restrictions, coupled with opportunistic pricing by exporters, are creating financial and operational hurdles for Russia’s war machinery, demonstrating the indirect but powerful effects of economic sanctions.
