'China has a lot more to lose': U.S. considering sanctioning Chinese firms aiding Russia's war

• The U.S. is considering slapping sanctions on Chinese companies it believes are helping Russia fuel its war in Ukraine, members of Congress told CNBC.
• Lawmakers may "very soon" follow similar proposals from the EU, in what would mark the first direct penalties against Beijing over its alleged military support for Moscow.
• "China has to understand that the same kinds of sanctions which are beginning to really take hold in Russia ... can also be applied to China," Senator Gerald Connolly said.

Munich, GERMANY — The U.S. is considering slapping sanctions on Chinese companies it believes are helping Russia fuel its war in Ukraine, members of Congress told CNBC, marking the first direct apportioning of blame toward Beijing since the start of the war.

Democratic Senator Gerald Connolly, member of the U.S. House Committee on Foreign Relations, on Saturday said that lawmakers were already considering such plans after similar measures were proposed last week by the European Union.

The provisions would mark the first direct penalties against Beijing despite long-held Western suspicions over its support for Russia's military operations.

"China has to understand that the same kinds of sanctions which are beginning to really take hold in Russia and are affecting Russian productivity, economic performance and quality of life, can also be applied to China," he told CNBC's Silvia Amaro on Saturday at the Munich Security Conference.

"And frankly, China has a lot more to lose than Russia."

U.S. sanctions could severely hurt a Chinese economy already in the doldrums, after a slower-than-anticipated Covid-19 recovery and turbulence in its real estate sector. But such a step could also hurt the U.S.,given the countries' trade interdependence,