European Union analyzing removing Russia from the union’s international payments system.
(Ukrinform) Ukrainian diplomats have been working around the clock so that European countries could agree on a decision to cut Russia off from the global SWIFT payment system.
Ukrainian President Volodymyr Zelensky said this in his address on Saturday, according to an Ukrinform correspondent.
“It seems that Ukraine has gained the sincerity and attention of the whole normal, civilized world. And the practical result is here — SWIFT. There’s a lot of meaning in this word for the Russian Federation – disconnection from global financial civilization. Our diplomats have been fighting around the clock for all countries in Europe to agree on a very strong and fair decision to cut Russia off from the international interbank network. We also have this important victory,” he said.
Zelensky stated that this means billions of losses for Russia. He stressed that this is a concrete price for a vile invasion of Ukraine. “We have always said that the truth is ours, which means that even the greatest achievements are being made,” he said.
On February 26, technical preparations began for the decision to disconnect Russia from the SWIFT payment system. The cutoff from SWIFT is called a “nuclear weapon for the economy.”
What is SWIFT and why is it so important?
(Euronews) The Society for Worldwide Interbank Financial Telecommunication (SWIFT) is a high-security intermediary system that allows banks and institutions around the world to carry out financial transactions – that is, ordinary payments – among each other.
The system was founded in 1973 and is headquartered in La Hupe, Belgium. Today, SWIFT links more than 11,000 financial institutions in more than 200 counties and territories, making it an essential piece of our globalised, fast-paced economy.
Crucially, SWIFT is used by EU member states to pay for Russian gas and oil, two resources that represent the backbone of the Russian economy.
Since the EU is Russia’s number one energy client, many are now calling for the country’s expulsion from SWIFT in order to deprive Moscow of the much-needed funds to sustain the ongoing invasion of Ukraine.
“If Russia is no longer able to actively participate in the international financial system, that has a major impact,” Fabian Zuleeg, Chief Executive at European Policy Centre (EPC), told Euronews.
“It makes it very difficult to run financial institutions within Russia and it cuts off, very effectively, from outside finance. So, I think this is a move that would have helped.”