Russia Faces steep Price Hikes on Sanctioned Goods,Reports Show
Helsinki – Russia is paying significantly inflated prices for sanctioned goods,particularly from China,according to recent reports from the Bank of Finland and Capital Economics. The data reveals Russia is facing a nearly 90% price markup on sanctioned products sourced from China, compared to a 9% increase from other trading partners.
The Bank of Finland’s analysis concludes that trade sanctions are successfully limiting Russia’s access to critical goods. Prices for sanctioned products overall were 40% higher than those of non-sanctioned items. while China has become a key trade partner - now accounting for 30% of Russia’s goods exports and 50% of its imports - the relationship remains asymmetrical, with Russia far more reliant on China economically than vice versa.
“China is more critically important for Russia economically than Russia is for China. And Russia wants and needs more from the relationship than China is willing to provide,” Capital Economics stated.
Bilateral trade between Russia and china experienced a 9% decline during the first nine months of 2025, following a period of more than doubling between 2020 and 2024. Capital Economics also noted limited expansion of Chinese supply chains within Russia and constrained foreign direct investment, potentially due to Chinese firms’ concerns about Western sanctions.
These findings emerge as the Kremlin reportedly proposes business deals with the U.S. as part of ongoing talks to end the Ukraine war and lift sanctions. Simultaneously, Russia’s wartime economy is showing signs of strain, hampered by production bottlenecks, labor shortages, and a lack of Western technology.
Alexandra prokopenko, a fellow at the Carnegie Russia Eurasia Center and former Russian central bank advisor, wrote in Foreign Affairs last month that a more thorough war footing – similar to that seen during World War II – would be required to substantially increase military production or personnel. This would necessitate directing all available resources toward military needs or commandeering civilian production lines.
