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U.S. Treasury Imposes Sanctions on Chinese Businesses Supplying Iran Firm Selling Military Drones to Russia

Components from an Iranian drone on display at Joint Base Anacostia-Bolling in Washington in 2018. The U.S. levied sanctions March 9, 2023, against five companies based in China that are accused of providing components to an Iranian drone producer supplying Russia. (EJ Hersom/Defense Department)
Components from an Iranian drone on display at Joint Base Anacostia-Bolling in Washington in 2018. The U.S. levied sanctions March 9, 2023, against five companies based in China that are accused of providing components to an Iranian drone producer supplying Russia. (EJ Hersom/Defense Department)

Last week, the United States Treasury Department imposed sanctions on several Chinese businesses and one individual for supplying aerospace parts to an Iranian producer of drones sold to Russia in their attacks on Israeli and Saudi oil tankers.

According to media reports, the U.S. Treasury put out a statement saying that Hangzhou Fuyang Koto Machinery Company organized the shipment of millions of dollars of parts, including light aircraft engines, to Iran Aircraft Manufacturing Industrial Company, which created the Shahed-136 military drone and has been under sanctions since 2008.

Last month, the U.S. Defense Intelligence Agency said that the Islamic Republic of Iran used the Shahed-136 in an attack against the oil tanker MT Mercer Street sailing off Oman and has sent the military weapon to Houthi terrorist fighters in Yemen. Intelligence officials also note that Iranian drones have been used by Russia in its invasion of Ukraine to reinforce its military forces.

In a statement to reporters Thursday, Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian Nelson said Iran is "directly implicated in the Ukrainian civilian casualties that result from Russia's use of Iranian UAVs in Ukraine."

Officials also accused China of considering supplying arms to Moscow and warned Beijing of engaging in such actions. China has denied the claims by American officials, saying that sending weapons "will not bring peace" in Ukraine.

In response to the sanctions on Chinese businesses, Chinese Foreign Ministry Mao Ning said that Beijing has always gone against sanctions used by America, saying that the Chinese government will "continue to resolutely safeguard the lawful rights and interests of Chinese companies."

The sanctions, announced by the Treasury Department, freeze any assets aand bar American citizens from dealing with them directly. Officials said that individuals engaged in specific transactions risk being hit by the sanctions.

As Russia continues to face mounting casualties in its invasion of Ukraine, the Biden White House has said that the Islamic Republic could aid its war atrocities, providing Moscow with drones, ammunition, and other weaponry to target civilian infrastructure. Following the war, Tehran has voiced support for President Putin's attack against Kyiv, providing economic and military aid as Russia continues to face international sanctions.

Related Story: China to Import Record Amounts of Russian Oil in Defiance of U.S. Led Sanctions

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