Canada among countries moving to block Russian access to SWIFT

Canada among countries moving to block Russian access to SWIFT
Protesters rally against Russia's invasion of Ukraine in Rome on Friday. (Filippo Monteforte/AFP/Getty Images)

Western allies announced sweeping new sanctions against Moscow on Saturday, including kicking some Russian banks off the main global payments system.

Seeking to ratchet up economic punishment for Russian President Vladimir Putin over his invasion of Ukraine, the United States, Canada and others also said they would impose restrictions on Russia’s central bank to limit its ability to support the rouble.

The announcement came as fighting continued across Ukraine. Reuters witnesses in Kyiv reported occasional blasts and gunfire in the city on Saturday evening, but it was not clear exactly where it was coming from. The capital and other cities have been pounded by Russian artillery and cruise missiles.

Putin launched what he called a special military operation before dawn on Thursday, ignoring Western warnings and saying the “neo-Nazis” ruling Ukraine threatened Russia’s security.

Russia’s assault is the biggest on a European state since the Second World War and threatens to upend the continent’s post-Cold War order.

A U.S. defence official said Ukraine’s forces were putting up “very determined resistance” to the three-pronged Russian advance that has sent hundreds of thousands of Ukrainians fleeing westwards, clogging major highways and railway lines.

“As Russian forces unleash their assault on Kyiv and other Ukrainian cities, we are resolved to continue imposing costs on Russia that will further isolate Russia from the international financial system and our economies,” according to a joint statement from the United States, France, Canada, Italy, Great Britain and the European Commission.

“We will implement these measures within the coming days.”

After initially shying away from such a move, the allies committed to “ensuring that selected Russian banks are removed from the SWIFT messaging system.” They did not name the banks that would be expelled.

The move — which the French finance minister had earlier called a “financial nuclear weapon” because of the damage it would inflict on the Russian economy — deals a blow to Russian trade and makes it harder for Russian companies to do business.

SWIFT, or the “Society for Worldwide Interbank Financial Telecommunication,” is a secure messaging network that facilitates rapid cross-border payments, making it a crucial mechanism for international trade.

Sanctions on Russia’s central bank could limit Putin’s use of his more than $630 billion US in international reserves, which have been widely seen as insulating Russia from some economic harm.

The new measures will prevent Russia from “using its war chest,” according to Ursula von der Leyen, president of the European Commission, the European Union’s executive.

Read the full article by Thomson Reuters on CBC News

This report was initially published by CBC News on Saturday, Feb. 26, 2022.

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