RUSSIA INVASION : BIDEN, EUROPE WAITING ON KEY SWIFT SANCTION AGAINST RUSSIA

By Josh Boak, Fatima Hussein and Ken Sweet

President Joe Biden speaks about the Russian invasion of Ukraine in the East Room of the White House, Thursday, Feb. 24, 2022, in Washington. U.S. and European officials are holding one key financial sanction against Russia in reserve. They’re choosing not to boot Russia off SWIFT, the dominant system for global financial transactions. (AP Photo/Alex Brandon)

U.S. and European officials are holding one key financial sanction against Russia in reserve, choosing not to boot Russia off SWIFT, the dominant system for global financial transactions.

The Russian invasion of Ukraine caused a barrage of new financial sanctions Thursday. The sanctions are meant to isolate, punish and impoverish Russia in the long term. President Joe Biden announced restrictions on exports to Russia and sanctions against Russian banks and state-controlled companies.

But Biden pointedly played down the need to block Russia from SWIFT, saying that while it’s “always” still an option, “right now that’s not the position that the rest of Europe wishes to take.” He also suggested the sanctions being put in place would have more teeth.

 “The sanctions we’ve imposed exceed SWIFT,” Biden said in response to a question Thursday. “Let’s have a conversation in another month or so to see if they’re working.”

Still, some European leaders, including in the United Kingdom, favor taking the additional step of blocking Russia from SWIFT, the Belgium-headquartered consortium used by banks and other financial institutions that serves as a key communications line for commerce worldwide. The SWIFT system averaged 42 million messages daily last year to enable payments. The name is an acronym for the Society for Worldwide Interbank Financial Telecommunications, and about half of all high-value payments that cross national borders go through its platform.

Ukraine has sought for Russia to be excluded from SWIFT, but several European leaders would prefer to stay patient because a ban could make international trade more difficult and hurt their economies.

“A number of countries are hesitant since it has serious consequences for themselves,” said Dutch Prime Minister Mark Rutte, who believes a ban should be a last resort.

The British government says Prime Minister Boris Johnson pushed at a virtual meeting of the Group of Seven world leaders Thursday for Russia to be kicked out of SWIFT. It said there was “no pushback” but it was agreed that more discussion was needed. U.K. officials would not confirm Germany was resisting.

U.S. lawmakers have called on Biden to deploy every available financial sanction, with Senate Republican Leader Mitch McConnell saying Thursday that America should “ratchet the sanctions all the way up. Don’t hold any back. Every single available tough sanction should be employed and should be employed now.”