Germany softens its stance on curbing Russia’s access to Swift

BERLIN (Reuters) – Germany shifted its position on Saturday on restricting Russia’s access to the international SWIFT interbank payment system, joining other Western powers in backing tougher sanctions aimed at halting Russia’s invasion of Ukraine.

German Foreign Minister Annalena Barbock and Economy Minister Robert Habeck said: “We are working urgently on how to limit the collateral damage from breaking up with SWIFT in a way that affects the right people. What we need is a meaningful and practical restriction of SWIFT.” He said in a statement.

Germany, which has the largest trade flows between the European Union and Russia, has been reluctant to get involved in cutting Russia off from the world’s main international payments network, saying it must first weigh the economic consequences of such a move.

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Berlin’s change of position comes as Russian forces continue to bombard Kiev and other cities with artillery and cruise missiles on the third day of a campaign that has driven hundreds of thousands of Ukrainians to flee west towards the European Union, blocking major highways and railways. Read more

This move will hurt Russian trade and make it difficult for Russian companies to do business. SWIFT is a secure messaging system that facilitates rapid cross-border payments and is the primary mechanism for financing international trade.

Earlier on Saturday, Italy, the other EU member that has expressed reservations about taking such a step, said it would support Russia’s decoupling from the payment system.

Greece also joined the EU’s line on Swift and Hungarian Prime Minister Viktor Orban said his government would not block any planned EU sanctions.

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“This is the time to unite,” Orban said. “It’s war.” Read more

The EU’s foreign policy chief, Josep Borrell, said a decision on Swift could be made in the “coming days”. Read more

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(Andreas Reinke reports) Written by: Reham El-Koussa. Editing by Maria Sheehan and David Clarke

Our criteria: Thomson Reuters Trust Principles.

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