Venezuela Might Be Affected by Russian Banks" SWIFT Suspension
Analysts from Venezuela have expressed their worries about the expulsion of a number of Russian banks from SWIFT, an international messaging system that allows the interconnection of banks. These measures could affect the finances not only of Venezuela, but also of other countries in the region, damaging their capability to move funds, which is highly dependent on services provided by Russian banks. Russian Banks’ SWIFT Expulsion Could Affect Venezuela
The recent announcement of the expulsion of some Russian banks from the SWIFT payments system has raised concern about the effects it could have in countries like Venezuela, which is linked to the Russian banking system. Jose Guerra, a Venezuelan economist, was one of the first to speculate about this possible problem on social media.
Guerra stated:
What does it mean for Venezuela? If the government money is in Russian banks, it will not be possible to transfer it to make payments. everything gets complicated.
Guerra further explained that if Venezuelan funds are indeed in Russian banks, companies like PDVSA, the national oil company, would be unable to pay for goods and services through those accounts. “If PDVSA has an account in a Russian bank excluded from SWIFT and wants to make a transfer to Banxico in Mexico, UBS in Switzerland, or a bank in Turkey to pay a supplier, it will not be able to do so that way,” he elaborated.
While there is no direct knowledge about the funds that Venezuela manages through Russian institutions, the sanctions already applied to the South American country have increased reliance on these services, according to reports. The Devalued Ruble
Apart from the aforementioned connection issue, there is another problem that Venezuelan funds in Russia might face. Since the news about the SWIFT disconnection of some Russian banks was revealed, the ruble has lost more than 30% of its value, hitting institutions and countries that had their savings in the form of the Russian fiat currency.
If Venezuela has funds in Russian banks, they are affected by this situation, which could worsen if the conflict in Ukraine escalates or expands. According to Juan Gonzalez, director of the National Security Council for the Western Hemisphere, these sanctions will affect other countries on the continent. Gonzalez stated:
The sanctions on Russia are so robust that they will have an impact on those governments that have economic affiliations with Russia. So Venezuela is going to start to feel that pressure, Nicaragua is going to start to feel that pressure, as is Cuba.
Venezuela has been accused of using bitcoin to bypass economic sanctions before, but the capabilities and the cryptocurrency holdings of the country are currently unknown. Tags in this story jose guerra, juan gonzalez, Payments, pdvsa, ruble, Russian banks, Services, Swift, Venezuela
What do you think about the effect that the SWIFT disconnection of some Russian banks could have on Venezuela and other economies? Tell us in the comments section below. Sergio Goschenko
Sergio is a cryptocurrency journalist based in Venezuela. He describes himself as late to the game, entering the cryptosphere when the price rise happened during December 2017. Having a computer engineering background, living in Venezuela, and being impacted by the cryptocurrency boom at a social level, he offers a different point of view about crypto success and how it helps the unbanked and underserved. US Inflation Could Be Worse Than Expected, Goldman Sachs Says — Atlanta Fed President Favors 25 BPS Rate Hike ECONOMICS | 1 day ago Russian Bank Run Begins as Ruble Plunges to Record Low Amid Escalating Sanctions ECONOMICS | 2 days ago
Image Credits: Shutterstock, Pixabay, Wiki Commons Previous articleUAE Property Developer DAMAC to Launch Metaverse Project in March Says Managing Director Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. Read disclaimerShow comments More Popular NewsIn Case You Missed ItFarmville Creator Zynga to Launch NFT Games, Says Gaming Firm"s Blockchain Lead
American social game developer Zynga has plans to launch non-fungible token (NFT) games in the near future. Zynga’s vice president of blockchain, Matt Wolf, told the press that the company is looking at the cycle right now and “figuring out ... read more.India Won"t Legalize or Ban Crypto at This Stage, Finance Minister Confirms Topps Plans to Auction Rare 1952 Mickey Mantle NFT Card Minted on Ethereum Fintech Specialists Predict Ethereum Price Hitting $6,500 This Year Before Rising to $26,338 by 2030 US Inflation Jumps to 7.5%, CPI Climbs at Fastest Rate in 40 Years, Citizens See Little Wage Growth