The West still keeps one of the harshest sanctions in reserve. What would disconnecting from SWIFT mean for Russia? | TVNOVINY.sk – TVNOVINY.sk

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Iran became the first country to be excluded from the SWIFT system in 2012.

One way to truly isolate Russia is to impose severe sanctions. Disconnection is considered to be one of the strictest economic measures from the global interbank payment system SWIFT, which is used to transfer money around the world. Following Thursday’s attack on Ukrainian targets, Ukrainian President Volodymyr Zelensky and IBaltic Foreign Ministers. However, other states do not share the same attitude.

German Chancellor Olaf Scholtz and US President Joe Biden have agreed that cutting Russia off from the payment system is not one of the measures they have seriously considered in creating sanction packages.

They warn that even if they cut off Moscow from SWIFTRussian banks have hit hard, and at the same time it would significantly reduce European creditors’ ability to access their money. In addition, Russia has been working for some time to create an alternative payment system.

Denial of Russia’s access to SWIFT would also be significantly felt by Germany, which is Moscow’s third largest trading partner after China and the Netherlands. The willingness of the most populous EU country to join the Zelenský proposal is all the less so because it has already made a sacrifice in the form of postponing the certification of the Nord Stream 2 gas pipeline.

The exclusion of Russia would probably cause it to become even more economically attached to China, which would welcome this as it tries to remove the dollar from the position of the world’s major currency, the BBC writes.

Such a step was the subject of discussions in 2014 after the Russian annexation of Crimea. The Kremlin then declared that it would consider it a declaration of war.

The first country to be excluded from the SWIFT system was Iran in 2012, which paid for it by losing half of its oil export revenues and reducing foreign trade by almost a third. Iranian banks were reconnected to the global transaction network in February 2016.