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Monday, June 17, 2024

West to expel Russian banks from global payment system; in support to Ukraine

KYIV – Western supporters announced new sanctions against Moscow on Saturday, including the expulsion of key Russian banks from the global payment system, as contemptuous President Volodymyr Zelenskiy says Ukrainian troops are evicting Russian troops moving forward in Kyiv.

It wants to impose sanctions on Russian President Vladimir Putin for his attack on Ukraine, the United States and its European allies and say they will impose sanctions on Russia’s central bank to reduce its ability to support the ruble and fund its war.

The announcement comes as the war continues throughout Ukraine. Reuters witnesses in Kyiv reported gunshots and explosions in the city on Saturday evening, but it is unclear where they came from. The capital and other cities have been hit by Russian weapons and cruise missiles.

Putin unveiled what he called a special military campaign on Thursday, ignoring Western warnings and calling Ukraine a “neo-Nazi” threat to Russia’s security – a case Kyiv and Western governments say is baseless propaganda.

Russia’s invasion has been the largest in Europe since World War II and has threatened to postpone post-World War II command.

A U.S. security official said Ukrainian troops had set up a “strong resistance” to Russia’s three-pronged approach that had sent hundreds of thousands of Ukrainians fleeing west, closing major roads and railways.

“As Russian forces invade Kyiv and other Ukrainian cities, we are determined to continue to put costs in Russia that will further separate Russia from the international financial system and our economy,” Western allies said while raising their sanctions response.

“We will implement these measures in the coming days,” according to a joint statement from the United States, France, Germany, Canada, Italy, Britain and the European Commission.

After skipping the move mainly due to concerns about their economic impact, their partners said they were committed to “ensuring that selected Russian banks are removed from the SWIFT messaging system.” They did not say which names would be fired but an EU official said about 70% of Russia’s banking market would be affected.

The move – the French finance minister had previously called it a “nuclear weapon” because of the damage it will do to the Russian economy – disrupts Russia’s trade and makes it difficult for its companies to do business.

SWIFT, or the “Society for Worldwide Interbank Financial Telecommunication”, is a secure messaging network that manages cross-border transaction payments, making it an important means of international trade.

Russia’s central bank sanctions could limit Putin’s spending of more than $ 630 billion in international reserves, widely regarded as protecting Russia from some economic damage.

The new measures will prevent Russia from “using its military might,” according to Ursula von der Leyen, president of the European Commission, a European Union official.


Clay Lowery, vice president of the Institute of International Finance, said the new sanctions “would likely exacerbate further banking and dollar inflation, create more sales, and attract more savings.”

But because Russia’s major banks are deeply involved in the global financial system, new sanctions, such as the termination of SWIFT, could have a spillover effect, hurting trade partners in Europe and elsewhere.

Ukrainian Prime Minister Denys Shmygal said on Twitter (NYSE 🙂 this Sunday morning: “Thank you to our friends … for committing to removing several Russian banks from SWIFT.”

The Kremlin said its troops were retreating “in all directions” after Putin ordered him to pause on Friday. The Ukrainian government has said there has never been a break.

“We have tolerated and successfully suppressed enemy attacks. The war continues, ”Zelenskiy said in a video message from the streets of Kyiv on social media.

The crisis has strengthened the NATO Western military alliance, which has announced a series of measures to strengthen its eastern side. Although NATO has said it will not send troops to Ukraine, a series of countries are sending military aid.

US President Joe Biden has authorized the release of up to $ 350 million from US stockpiles, while Germany, in defiance of its long-term policy of not sending weapons to war, said it would send anti-tank and anti-aircraft missiles.

Amid a series of alleged cyberattack attacks in Moscow, Ukrainian Deputy Prime Minister Mykhailo Fedorov said his government would create an “IT force” to fight back. Kyiv has already silently appealed to its underground hackers to help fight Russian forces, Reuters reports alone.

Fedorov also called on Saturday that SpaceX billionaire Elon Musk to provide Ukraine with the company Starlink satellite broadband service. Musk responded on Twitter: “Starlink service is still active in Ukraine. More terminals are on the way. ”

Ukraine, a country of 44 million people, gained independence in Moscow in 1991 after the fall of the Soviet Union and sought to join NATO and the EU, Russia’s policies.

Putin said he should remove what he called the biggest threat to his country from its small neighbor, which he accused of exterminating Russian-speaking people in eastern Ukraine – something Kyiv and its Western allies dismiss as false.

A Ukrainian presidential adviser said about 3,500 XNUMX Russian soldiers have been killed or wounded. Western officials also said intelligence had shown that Russia was suffering more than expected and was slowing down.

Russia has not released any casualties figures and has not been able to verify tolls or low accuracy images.

We know that (the Russian forces) did not make the progress they wanted to make, especially in the north. They are frustrated with what they see as the most serious resistance, ”said one US official, without giving evidence.

Kyiv Mayor Vitali Klitschko said there are no large Russian troops in the capital but the invading forces are working. Klitschko, a former world heavyweight boxing champion, later told the German newspaper Bild that the city was “almost surrounded”.

Authorities handed out thousands of firearms to residents and told residents to make gas bombs.

At least 198 Ukrainians, including three children, were killed and 1,115 were injured so far, Interfax quoted the Ukrainian Ministry of Health as saying.

Interfax later quoted regional officials in Donetsk, in eastern Ukraine, as saying that 17 civilians had been killed and 73 injured in Russian bombings.

Moscow says it is careful not to hit people’s places.

UN refugee official Filippo Grandi said more than 150,000 Ukrainian refugees have fled to neighboring countries – half of them to Poland and most to Hungary, Moldova and Romania.

Russia’s defense ministry says its troops have captured Melitopol, a city of 150,000 in southeastern Ukraine. Ukrainian officials did not comment and Britain questioned the report.

If confirmed, it will be the first Russian people to take over.

Several European countries, including Russia’s Baltic neighbors, Lithuania and Latvia, say they have closed their airports on Russian flights. Germany has said it is preparing to follow that.

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