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INSIGHT: Europe and US withdraw threats to exclude Russia from SWIFT payment system should Russia invade Ukraine

By Elizabeth Hearst for AMLi

Representatives from Europe and the US are believed to be moving away from threats of excluding Russia from the international SWIFT payment system.

Politicians are believed to be increasingly wary of the move, fearing Russia could build an alternative payments system, and are instead favouring economic sanctions. 

German Government sources yesterday confirmed to Handelsblatt that targeted economic penalties are being devised against some of the largest Russian banks. 

The move comes in the wake of weeks of discussions between American and European representatives on a collective reaction in the event of a Russian military operation against Ukraine. The EU has previously threatened Russia with “massive consequences”, should it invade. 

It’s believed politicians are concerned the exclusion of Russia from the international SWIFT system could lead to a “destabilisation of the financial markets in the short term” and could lead to the development of an alternative payment infrastructure. 

However, the US has pushed back on reports with a spokesperson for the National Security Council telling Politico that “no option is off the table” when it comes to Russia. 

German Foreign Affairs Minister Annalena Baerbock visited Kyiv early this week, before travelling to Moscow where she is expected to meet her Russian counterpart Sergey Lavrov in a “high stakes meeting”. She previously warned that any move by Russia against Ukraine would have a “high price… economically, politically and strategically”.

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