From FT Alphaville:
The impact of throwing Russia out of SwiftThe messaging network has become the embodiment of the “weaponisation of finance”
Vladimir Putin’s declaration of war on Ukraine has revived calls to kick Russia out of Swift. The measure is seen as among the most severe that the US, EU and UK could take.
Denying Russian banks access to Swift is far from a given. It would, for instance, undermine Europe’s capacity to pay for Russian oil and gas, perhaps raising energy prices in the process. Imposing a ban would also require strong consensus. At present, it’s only the UK that really wants it and some EU members remain set against it.
As we’re not geopolitical experts, we really can’t tell you what the final call will be. But we do know a little about the plumbing that lies behind international payments. And given the pace of change seen over the past week, we thought it worth trying to explain now why getting booted out would be so painful to Moscow.....*****
....To get a better grip on why this is so important to Putin (and Western leaders), it’s worth reading this piece from Bloomberg’s Javier Blas (hat-tip to Adam Tooze):
In the 24 hours after Vladimir Putin signed a decree recognizing two breakaway Ukrainian territories, the European Union, the U.K., and the U.S. bought a combined 3.5 million barrels of Russian oil and refined products, worth more than $350 million at current prices. On top of that, the West probably bought another $250 million worth of Russian natural gas, plus tens of millions dollars of aluminum, coal, nickel, titanium, gold and other commodities. In total, the bill likely topped $700 million.....
....MUCH MORE
