As shots were fired in Ukraine, the West followed through with an unprecedented level of economic sanctions imposed on Russia. It will be hard to assess how long the war and the corresponding sanctions will last. From investors’ point of view, we can only make an assumption that both the war and the sanctions could last for years.
The direct impact of the Russia-Ukraine war on Asia and China should not be too heavy. Official data showed that trade between China and Russia in 2021 accounted for only 2.4% of China’s total foreign trade by value, while the trade between China and Ukraine was 0.3%. Both figures were far lower than the levels of China’s trade with the EU, the U.S. and some major Asian economies. Since the war is not on Russian soil, the country’s natural gas supply to China will not be severely affected.
