Exclusive: Ukraine eyes new sanctions on China, but Kyiv wary of peace talks fallout

Ukraine faces a difficult balancing act — sanction more Chinese firms for aiding Russia’s war machine without alienating Beijing, which could be key to ending Russia’s invasion.

Kyiv is currently considering imposing new sanctions against Chinese firms providing raw materials to Russia’s defense sector, a source close to the matter told the Kyiv Independent on condition of anonymity.

But doing so could risk pushing Beijing — an important economic partner for Kyiv — further from Ukraine and closer to Russia, the source said.

As momentum builds around peace talks, with President Volodymyr Zelensky heading to Istanbul on May 15, Kyiv is hoping China can nudge its Russian ally toward negotiating a ceasefire and bringing end to the invasion, Ukrainian officials said.

China could be a key country in ending Russia’s war and ushering in a “sustainable” peace, the press service of Ukraine’s Foreign Ministry told the Kyiv Independent.

Ukraine has largely abstained from publicly bad-mouthing China, but the relationship has taken a hit in recent weeks as Kyiv grows more vocal against Beijing’s support for Russia.

Days after Chinese troops were captured in Donetsk Oblast fighting alongside Russians, President Volodymyr Zelensky on April 18 slapped sanctions on three Chinese companies. In an speech, he accused Beijing of supplying Moscow with gunpowder and weapons.

While claiming to be neutral in the full-scale invasion, China provided 76% of Russia’s battlefield goods in 2023, according to the Kyiv School of Economics (KSE).

Top Ukrainian sanctions official Vladyslav Vlasiuk told the Kyiv Independent that Ukraine is “concerned about some apparently Chinese-made components found in weapons used to attack civilians and count on our partners to take some serious action to stop it.”

Ukraine sanctioned two Chinese firms — ​​Beijing Aviation and Aerospace Xianghui Technology Co. Ltd — as well as Zhongfu Shenying Carbon Fiber Xining Co. Ltd, for supplying carbon fiber to Russia used in Iskander ballistic missiles that frequently target cities across Ukraine, according to an official document seen by the Kyiv Independent.

Days later, Zelensky said Chinese citizens were working in Russian drone production factories, even claiming Russia could have “stolen” drone technology from China, during a news conference in Kyiv.

On May 9, as Xi Jinping watched Russian soldiers march through Moscow during the WWII Victory Day parade, Ukraine followed up with sanctions on the Hong Kong-based firm Smart Kit Technology. The company was already subject to U.S. sanctions for shipping raw materials and technology like chip-making machines to Russian enterprises.

Meanwhile, Ukrainian media reported in February that Chinese companies were also investing in occupied territories and working with the occupying authorities. Kyiv notifies Beijing when Russia attempts to lure a Chinese company to the occupied territories, Ukraine’s Foreign Affairs Ministry press service said.

“The government bodies of China respond to such appeals of the Ukrainian side and, after confirming the relevant information, take measures to prevent interaction of Chinese business circles with representatives of the temporarily occupied territories of Ukraine,” the ministry said.

The recent sanctions are Ukraine’s first proper slap on China’s wrist. Zelensky previously accused Beijing of “disrupting” the peace process and supplying “elements of Russia’s weaponry” during a conference in Singapore in June 2024, but took no tangible action.

Rocking the boat

Prior to the crackdown on the Chinese companies, Zelensky’s administration turned a blind eye to Beijing’s “no limits” partnership with Moscow, despite China helping Russia, including by skirting Western sanctions and supplying dual-use goods for military purposes.

There is little anti-China rhetoric from the Ukrainian government, and unlike other countries that support Russia, Kyiv hasn’t cut ties with Beijing. In July 2024, Ukraine’s Foreign Minister at the time, Dmytro Kuleba, even visited Guangdong Province to convince local businesses and authorities to invest in Ukrainian regions, specifically in Mykolaiv Oblast.

“At this moment, we cannot see a strong will from the side of the government to move away from China,” Arthur Khartyonov, President of the Liberal Democratic League of Ukraine, an NGO, and founder of the Free Hong Kong Center, a pro-democracy initiative , told the Kyiv Independent.

Chinese exports to Ukraine reached a record high last year. The value of Chinese goods increased to $14.5 billion from $10.44 billion in 2023, outgunning Polish, German, and Turkish imports for the top spot, according to the Center for Economic Strategy (CES) in Kyiv.

While Ukrainian exports to China dipped from $8 billion in 2021 to $2.4 billion last year, this is largely due to blocked trade routes and war-time complications rather than any political decision, Dmytro Goriunov, an expert at the KSE Institute and Head of the “Russia Will Pay” project, told the Kyiv Independent.

Ukraine is unlikely to divest from China, as Beijing remains the top producer for goods that it needs, including radio equipment for military use, drones, generators, and equipment that props up the energy grid after attacks, he added. Kyiv’s budgetary constraints mean it is stuck with China, for now.

Issues began piling up when Kyiv failed to woo Beijing with its 10-point peace plan presented in 2022. Instead, Xi presented his own peace formula in February 2023 that received a lukewarm response in Ukraine.

Zelensky said he agreed with only some of China’s points. In the West, the plan was largely criticized for being too much in Moscow’s favor, while Russia celebrated it.

The points were general and included conditions like a cease-fire, the lifting of sanctions on Russia, and respect for territorial sovereignty. Beijing hasn’t recognized Russia’s 2-14 annexation of Crimea nor the occupied Ukrainian territories Moscow claims to have annexed in 2022.

A year later, China snubbed Kyiv’s invitation to the Global Peace Summit in Switzerland that gathered nations supportive of Ukraine’s peace formula. To add insult to injury, Beijing then announced that over two dozen countries backed the Chinese peace plan.

By June, Zelensky’s frustrations reached a tipping point, and he accused China of “working hard… to prevent countries from coming to the peace summit.” Beijing maintained its neutrality and refuted “fanning fire or fueling the flames.”

On China’s end, it wants to make sure the status quo within Russia remains steadfast, Dr. Marina Rudyak, an international development consultant and a lecturer at Heidelberg University's Center for Asian and Transcultural Studies, told the Kyiv Independent.

“It's in China’s interest to keep its border (with Russia) stable and secure and keep Russia stable. Anything that is not (Russian President Vladimir) Putin is more unpredictable than Putin,” she said.

What next?

After several attempts to engage with Chinese officials in Ukraine failed, Kyiv realized it needed a different approach. When Ukraine captured several Chinese soldiers on April 8 and Beijing denied any involvement, Kyiv saw its opportunity to put its foot down.

While Ukraine can’t simply cut trade with China, it knew it had scope to go after Chinese companies involved in Russian weapons production, as well as two Chinese captains sailing sanctioned Shadow Fleet vessels.  

It’s not clear how informed the CCP is about the involvement of Chinese citizens and companies in the war. The central leadership is unlikely to have full knowledge or responsibility for all the Chinese support for Russia, said Rudyak.

The testimonies of the captured Chinese troops suggest there is a “significant number” of Chinese citizens fighting with Russia, the Foreign Ministry’s press service said. “This may indicate a systemic problem and insufficient effectiveness of the Chinese authorities' measures to prevent this phenomenon,” the ministry added.

For now, China has not publicly responded to the sanctions aside from calling the accusations “groundless.” Tensions then escalated when Kyiv presented evidence of Chinese citizens and companies to the Chinese Ambassador to Ukraine Ma Shengkun.

“We have clarified China's position on the relevant issues. China strongly opposes groundless accusations and political manipulations,” Guo Jiakun, a spokesperson of the Chinese Foreign Ministry, said during a press briefing on April 22.

Ukraine wants to open up dialogue with China so that tensions don’t boil over. The country is powerful and, like Turkey, a possible mediator between Ukraine and Russia if Kyiv can win it over.

“China is first pro-China, not exactly pro-Russia, so there are hopes that China may persuade Russia to stop the war,” Goriunov said.  Ukrainian Deputy Foreign Minister Yevhen Perebyinis cautiously assured Ambassador Shengkun on April 22 that Ukraine “values its strategic partnership with China” while urging Beijing to “stop supporting Russia.”

President Xi didn’t seem to get the message as he sat next to President Putin during Moscow’s Victory Day Parade. The day before, the two “friends of steel” reiterated their partnership in a joint statement and announced deeper cooperation, including in military ties to counter the U.S.

Conceringly for Ukraine, the statement included a line about China helping establish peace in Ukraine with Russia and addressing the “root causes” of the war– a thinly veiled reference to Russia’s narrative about NATO expansion.

While Ukraine is eager for a diplomatic meeting to iron out the tensions, the Chinese side is taking a long time to consider Kyiv’s proposals, the Ukrainian Foreign Ministry said. This does not bode well for their bilateral relations.

“Further delaying or avoiding such contacts could lead to a crisis of confidence, which is highly undesirable,” the ministry added.

Will Putin meet Zelensky? As Ukraine, Russia peace talks loom, all eyes are on Kremlin’s next move

With just a day to go before Russian-proposed peace talks might begin in Istanbul, the Kremlin is still refusing to confirm whether or not President Vladimir Putin will attend the event. President Volodymyr Zelensky has already said he will meet Putin there, a move that puts the ball very much into the Kremlin’s court. Upping the pressure further, U.S. President Donald Trump said on May 12 that he believes that “both leaders” will be there, thrusting Putin into a delicate diplomatic dilemma —

The Kyiv IndependentChris York