Kyrgyz senders of payments for goods to China and Europe have since September 25 been required to sign a guarantee that the products will arrive in Kyrgyzstan within 60 days, with the move aimed at guarding against the merchandise instead getting sent to Russia in a sanctions-dodge.

The Moscow Times spoke to three importers who confirmed the turning of the sanctions screw.

Western capitals unsettled by booming trade flows seen in Kyrgyz data that do not match up with the size and requirements of the small Central Asian country’s economy have in the past year upped the pressure on Bishkek for action against “re-exports” to Russia that breach their sanctions on Moscow. Kyrgyzstan’s government has argued that it respects the sanctions but cannot feasibly stamp out all sanctions-busting activities pursued by third parties in the private sector.

In late April, Joseph Webster, a senior fellow at the Atlantic Council’s Global Energy Center, in an opinion piece for The Interpreter, wrote: “Kyrgyzstan’s trade figures defy economic logic, suggesting that a vast amount of its imports are bound for a third country – namely, Russia. Kyrgyzstan’s trans-shipment to Russia of dual-use goods, including ball bearings [used in tank production], vehicle spare parts, and other items, have had direct military implications for the invasion of Ukraine.”

The demand for the signing of the guarantees is outlined in a decree issued by the central bank, the National Bank of Kyrgyzstan. It puts in place a one-year prohibition on foreign companies paying for goods, services or works outside Kyrgyzstan unless the acquired goods are physically imported into the country.

The only exceptions are for specific state-approved companies to be defined by the government.

In August, a US Treasury delegation visited Bishkek. It reportedly demanded that Kyrgyz banks stop providing the means for Russian circumvention of international sanctions, and made clear that Kyrgyzstan could be evicted from the SWIFT interbank transactions system and barred from US dollar-based transactions in the global financial system if it did not take action, according to tax consultant Mikhail Zhukhovitsky, as cited by The Moscow Times.

Kyrgyz businesses that choose to continue fulfilling orders for Russian customers despite the requirement to physically import the specified goods into Kyrgyzstan ahead of re-export to Russia now theoretically face increased supply chain costs including in the areas of customs duties, logistical expenses and VAT. Efforts will be made to pass those costs on to the Russian end-customers, an approach that will add to pressure on the Russian economy.