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Pressure mounts on Germany to drop rejection of SWIFT ban for Russia

Germany is increasingly isolated in its opposition to kicking Russia out of the SWIFT international payment systems after Italy, Austria, Hungary and Cyprus announced support for such a sanctions measure.

Berlin is under sharp pressure to change course. German Chancellor Olaf Scholz met with Polish Prime Minister Mateusz Morawiecki and Lithuanian President Gitanas Nausėda in Berlin on Saturday to discuss potential next steps on sanctions against Russia following President Vladimir Putin’s aggressive war against Ukraine.

The three leaders “agreed that further targeted and effective measures should be agreed,” German government spokesperson Steffen Hebestreit said following the meeting. He didn’t say whether these should include SWIFT, but there were signs emerging on Saturday that Berlin might support including SWIFT as part of further sanctions.

Ahead of the meeting, Morawiecki issued a forceful statement saying he came to Berlin “to shake Germany’s conscience so that they decide on firm and crushing sanctions that would influence Putin’s decisions.” He added: “Today there is no time for the selfishness.”

Ukraine has repeatedly asked the EU to block Russia from SWIFT in retaliation for the invasion. Yet EU leaders failed to reach unanimity on a ban during an extraordinary summit on Thursday, as a coalition of countries led by Germany and Italy opposed the move. Scholz said Thursday that the EU should “reserve” a SWIFT ban “for a situation where it is necessary to do other things as well.”

On Saturday, however, all the countries skeptical of a SWIFT ban except Germany indicated a change of heart.

Italian President Mario Draghi told Ukraine’s President Volodymyr Zelenskiy in a phone call “that Italy fully supports and will support the line of the European Union on sanctions against Russia, including those in the SWIFT area,” Draghi’s office said in a readout of the call.

Hungarian Prime Minister Viktor Orbán said his country would not oppose a SWIFT ban. “Hungary at the Thursday [European] Union summit made it clear that we support every sanction that the Union agrees on. We don’t block anything,” Orbán said, according to state media.

A similar message came from Nicosia: “Cyprus has not objected to any EU sanctions, including cutting Russia off Swift,” Cypriot Finance Minister Constantinos Petrides wrote on Twitter.

Austria already said Friday that it was willing to drop its opposition to a SWIFT ban after the country’s National Security Council recommended that “in line with Austria’s stated policy of sanctioning Russia’s aggression in the harshest way possible, [Austria should] advocate internationally for Russia’s exclusion from the SWIFT system.”

Ukraine’s Zelenskiy said on Saturday that “we already have almost full support from EU countries to cut Russia off from SWIFT.”

Berlin’s position

Germany has stolidly maintained its opposition to excluding Moscow from the international payment system — but there were signs on Saturday that this position may be changing.

German Foreign Minister Annalena Baerbock and Economy Minister Robert Habeck said in a statement that Berlin was “working flat out on how to limit the collateral damage of a disconnection from SWIFT, so that it hits the right people. What we need is a targeted and functional restriction of SWIFT.” Baerbock had previously raised concern that a SWIFT ban would not only affect Putin and the Russian leadership but also ordinary citizens.

German Finance Minister Christian Lindner indicated on Thursday that Berlin’s opposition was linked to the country’s reliance on Russian gas exports. Cutting Russia off from SWIFT “would mean that there is a high risk that Germany will no longer be supplied with gas or raw materials,” Lindner said, while adding he was not definitely against such a move. “All options are on the table, including this one,” Lindner said.

On Friday, French Finance Minister Bruno Le Maire said that banning Russia from SWIFT was like holding “a nuclear weapon in your hands — you think before you use it.” Le Maire acknowledged that “some member countries have expressed reservations; we take them into account.” But he stressed: “France is not one of these countries, I want to say this very clearly.”

A French official said Saturday afternoon that the EU debate is “still ongoing” over banning Russia from the payment system. “I’m not aware of any blocking; I’m aware of a debate,” the official said. The official also suggested that the ban could target specific Russian institutions, and not Russia as a whole.

“To be efficient, we will need to be in tune over the lists of banks and potentially the public institutions in Russia which will have to be targeted,” the official said.

Meanwhile, Germany’s main opposition party, the Christian Democratic Union (CDU), is shifting toward endorsing a Russian SWIFT ban. Two party members told POLITICO that the CDU’s parliamentary group is considering convening an extraordinary meeting on Saturday evening to discuss this issue.

The German Bundestag will meet for an extraordinary plenary session on Sunday, during which Scholz will issue a government declaration. The CDU is considering to present a motion to parliament that would demand the chancellor to drop its opposition to a SWIFT ban, the two CDU members said.

“Following a SWIFT exclusion of Russia, energy deliveries from Russia may still be paid for in the future,” CDU party leader Friedrich Merz said. “Our high dependence on gas supplies from Russia is therefore not a viable argument against this now necessary sanction.”

Jacopo Barigazzi, Lili Bayer and Jules Darmanin contributed reporting.

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