Will Russia be excluded from the SWIFT banking system? : NPR

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Protesters in Los Angeles gather in support of Ukraine on February 24.

Patrick T. Fallon/AFP via Getty Images


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Patrick T. Fallon/AFP via Getty Images


Protesters in Los Angeles gather in support of Ukraine on February 24.

Patrick T. Fallon/AFP via Getty Images

Russia should be cut off from the SWIFT banking messaging system as punishment for invading Ukraine, three eastern European Union countries said on Thursday. Their call was echoed by Ukrainian President Volodymyr Zelenskyy, who called on the international community to help protect his country’s sovereignty.

On Thursday, the foreign ministers of Estonia, Latvia and Lithuania called for the adoption of a joint statement who condemned Russia’s attacks on Ukraine.

The ministers called on the international community to impose the “strongest possible sanctions on Russia, including disengaging Russia from SWIFT, isolating it politically” and supporting Ukraine.

In remarks Thursday, President Biden said the United States and its allies would not make the decision to block Russia from using the SWIFT system for global banking transactions because Europe did not want it, but he said the option would be held in reserve.

White House officials predicted last week that the first sanctions triggered by a Russian invasion were unlikely to include a ban on SWIFT, citing the potential for “ripple effects.”

SWIFT supports the global financial system, managing millions of secure messages every day to help banks manage their transactions around the world. SWIFT was founded in the 1970s and is headquartered outside of Brussels.

“It doesn’t move money, but it does move information about money,” Alexandra Vacroux, executive director of the Davis Center for Russian and Eurasian Studies at Harvard University, said in an interview with NPR last month. .

Cutting Russia off from the SWIFT messaging system is seen as the “nuclear option” because of the significant impact such a move would have, Vacroux said. When Iran was taken out of the system, she added, “they lost half of their oil export revenue and 30% of their foreign trade”.

Vacroux said Russia started working on its own version of SWIFT years ago, fearing it could be cut due to its illegal annexation of Crimea in 2014.

With Russia now attacking Ukraine in a full-scale invasion, Zelenskyy said Thursday that Russia should not be allowed to stay in the banking system.

“We demand the disconnection of Russia from SWIFT, the introduction of a no-fly zone over Ukraine and other effective measures to stop the aggressor”, he said via Twitteradding that he had discussed these measures with French President Emmanuel Macron.

Although it is an international organization jointly owned by its members, SWIFT said in the past that because it is incorporated in Belgium, it is obliged to comply with decisions that are confirmed by the government of its country of origin.

A version of this story originally appeared in the morning edition live blog.

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