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War in Ukraine: Swift exclusion - More and more politicians are demanding financial bludgeoning against Russia

2022-02-24T16:22:46.274Z


War in Ukraine: Swift exclusion - More and more politicians are demanding financial bludgeoning against Russia Created: 02/24/2022, 17:11 By: Lisa Mayerhofer Demonstrators in Ukraine protest against the Russian invasion. Several European politicians are now calling for Russia to be excluded from the Swift payment system. © Thomas Coex/AFP After the Russian attack on Ukraine, several European p


War in Ukraine: Swift exclusion - More and more politicians are demanding financial bludgeoning against Russia

Created: 02/24/2022, 17:11

By: Lisa Mayerhofer

Demonstrators in Ukraine protest against the Russian invasion.

Several European politicians are now calling for Russia to be excluded from the Swift payment system.

© Thomas Coex/AFP

After the Russian attack on Ukraine, several European politicians have called for the toughest sanction: Russia's exclusion from the Swift payment system.

This would have far-reaching consequences.

Brussels – There is war in Europe: Russian President Vladimir Putin attacked Ukraine with his army*.

Some European politicians are now demanding harsh consequences.

"With this act, Russia is committing a crime against peace," Czech President Milos Zeman said in a televised address to the nation on Thursday.

It is time to take sanctions that are much tougher than originally planned.

He specifically spoke out in favor of excluding Russia from the Swift international bank payment system.

Obviously referring to the Russian President, Zeman said: "You have to isolate the madman and defend yourself against him not only with words but with concrete measures." The own citizens, many of whom still remember the invasion of the Warsaw Pact countries to Czechoslovakia in August 1968, he called for calm.

Baltic states and EU politicians call for Swift exclusion

The three Baltic EU states of Estonia, Latvia and Lithuania also called for Russian banks to be excluded from Swift.

German European politicians also agree.

Reinhard Bütikofer (Greens), EU parliamentarian, told

Handelsblatt

: "Putin's invasion of Ukraine* represents such a serious breach of all international law and undermines Europe's security architecture so fundamentally that the EU has to measure its economic sanctions very harshly.

In my opinion, this also includes the exclusion of Russia from the Swift payment system.”

Daniel Caspary (CDU), chairman of the CDU/CSU group, and Nicola Beer, head of the FDP group in the European Parliament, are also talking about excluding Russia from the international payment system.

Exclusion from Swift is likely to hit Russia hard: The Society for Worldwide Interbank Financial Telecommunication, Swift for short, connects more than 11,000 banks in over 200 countries.

Credit institutions wishing to transfer funds across borders must use the organization's standardized messaging format to notify each other of initiated transfers.

Swift exclusion: Serious consequences not only for Russia

With an exclusion, payments or transactions with other countries could hardly be made in Russia - but there would also be massive restrictions within the country.

Even payments to countries like China, which are sympathetic to Russia's attack, would be severely curtailed.

Practically every Russian company would be affected and paralyzed in the long term - and this would also have massive consequences for the population.

This is one of the reasons why the sanction is so controversial.

This would also have serious consequences for the German economy: the claims of German companies on Russian companies could no longer be served if Russia were excluded from Swift.

And gas deliveries to Germany would no longer be possible - currently more than 50 percent of gas imports come from Russia.

IfW: Bear the "collateral damage" proportionately

The Kiel Institute for the World Economy (IfW) therefore fears for the European economy.

The sanctions because of the Ukraine conflict* have so far been mainly pinpricks against the power elite in Moscow.

That should change now, IfW Vice President and economic chief Stefan Kooths expects on Thursday.

His institute considers an EU-wide fund to support companies affected by the Russia sanctions to be advisable: "The negative repercussions will be unevenly distributed."

If this "collateral damage" were borne by everyone proportionately, it could absorb different levels of concern and thus facilitate joint action by the EU.

The result would be quicker reactions and tougher sanctions.

With material from AFP and dpa

*Merkur.de is an offer from IPPEN.MEDIA

Source: merkur

All news articles on 2022-02-24

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