Together with the USA, Canada and Great Britain, the EU also announced further sanctions late on Saturday evening. This should also increase the pressure on Switzerland to prevent bypasses.
Russia’s exclusion from the Swift payment system was also an issue during demonstrations against the Russian attack, such as here in London on February 26.
After hectic behind-the-scenes work, western powers have a late Saturday night Message published, which has it all. The United States, Canada, the European Commission, Germany, France, Italy and the United Kingdom have pledged to impose new sanctions against Russia and its ruler Vladimir Putin and his supporters “in the coming days”. The reason for this is the invasion of Russia in Ukraine.
Partial exclusion from Swift
This includes “select” Russian banks being excluded from the Swift financial system. The Ukrainian President Volodymyr Zelensky, among others, had repeatedly called for this. The American President Joe Biden said a few days ago that it was up to the Europeans that the measure had not yet been taken.
Most recently, Germany and Italy in particular had slowed down. The exclusion means that the banks concerned can no longer make normal international transfers to and from Russia. This could have resulted in Germany no longer being able to pay for its natural gas supplies from Russia and Moscow subsequently stopping supplies.
Accordingly, Finance Minister Christian Lindner on Friday first requested clarifications from the EU Commission and the European Central Bank (ECB) before Germany could agree to such a step.
According to the German government all Russian banks that are already sanctioned by the international community will be excluded from Swift. And if necessary, further money houses would be removed from the payment service system. What that means in concrete terms for Germany’s natural gas imports from Russia is still unclear.
It is becoming more difficult for Putin to finance his war
But the latest sanctions package contains another very unpleasant measure for Putin and is likely to affect his ability to finance the war: the Russian central bank’s access to its currency reserves is to be restricted. Russia’s gold and currency reserves are worth over $600 billion. The German government wrote on Saturday evening that the Central Bank’s ability to support the ruble’s exchange rate with international financial transactions is being restricted.
Putin also saved this sum to be able to withstand economic sanctions from the West longer. After Russia annexed Crimea, which belongs to Ukraine, in violation of international law in 2014, the Kremlin also increased its reserves significantly.
Some of these are located abroad. That’s why the US, the EU, the UK and Canada want to limit access to it so that it is less easy for Russia to circumvent the sanctions.
Furthermore, Western countries prohibit the purchase of citizenships, so-called golden passports, for wealthy Russians. This is to prevent those close to Putin from gaining access to their money thanks to Western citizenship.
Pressure on Switzerland is likely to increase
And finally, the USA, the EU, Great Britain and Canada set up a transatlantic working group to ensure the implementation of the measures. This “task force” also has the task of identifying and “freezing” the assets of sanctioned persons and companies, as the statement says. The group of Russian officials and elites in the vicinity of the Kremlin is to be expanded again.
In addition, and this is where Switzerland is likely to come under additional pressure, the alliance wants to “include other governments as well” so that illegal profits are not shifted and assets are hidden elsewhere in the world.
The Federal Council has so far acted rather hesitantly. He assured that one wanted to prevent the circumvention of measures via Switzerland. But so far he has not been able to bring himself to impose his own sanctions. Federal Councilor Karin Keller-Sutter is expected to attend a special meeting of EU interior ministers in Brussels on Sunday. It is to be expected that this topic will also be discussed there.