The U.S. decision to sanction a Chinese Politburo member will provoke a tit-for-tat response from Beijing, adding to the mounting tensions between the two countries. On July 9, the U.S. Treasury Department sanctioned one Chinese government agency and four individuals for their role in the ongoing crackdown on ethnic Uyghurs in Xinjiang. Among the sanctioned individuals was Xinjiang Communist Party Secretary Chen Quanguo, a member of the Politburo and a potential future contender for the top-level Politburo Standing Committee in 2022. 

• Chen was singled out in December 2019 as a likely sanctions target when U.S. lawmakers passed the bill that would eventually become the Uyghur Human Rights Policy Act of 2020, which President Donald Trump signed into law on June 17. This long lead time made the sanctions in the bill largely symbolic by giving both Chen and the Chinese government ample warning to prepare contingency plans.  
• Recent U.S. visa restrictions on Chinese officials and journalists have seen Beijing respond in a precise tit-for-tat manner, tailoring its own countermeasures to match those of the United States. 

While such sanctions will not alone derail the U.S.-China "phase one" trade deal, they will add to the growing points of tension that, when combined, threaten the agreement. The White House has worked to preserve its trade deal with Beijing as a key campaign promise ahead of the November presidential election, even amid rising tensions over Hong Kong, Taiwan, Huawei, the South China Sea and the recent border clash with India. 

The targeted focus of these sanctions on individuals suggests a more measured U.S. approach to the Uighur crisis in Xinjiang, similar to Washington's approach in its response to Beijing's encroachment over Hong Kong. Even as it feels compelled to act in some way, the White House is unlikely to resort to sweeping measures against China that could provoke broader, global economic repercussions, given the high risk of political backlash and Trump's troubled electoral prospects.

Regardless, Chinese financial institutions fear that an increasing volley of U.S. sanctions on individuals could result in negative repercussions for them. July 9 leaks revealed top state-owned banks in China are revisiting contingency plans in the unlikely case that Washington takes away their access to the U.S. dollar, or if specific account holders face liquidity issues after being sanctioned.