Swift turn: German FM says Europe needs bank transactions system independent from US

Published time: 21 Aug, 2018 16:41Edited time: 21 Aug, 2018 20:50

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The European Union should set up a system that would allow Brussels to be independent in its financial operations from Washington, according to German Foreign Minister Heiko Maas.

“It is indispensable that we strengthen European autonomy by creating payment channels that are independent of the United States, a European Monetary Fund and an independent SWIFT system,” Maas wrote in the Handelsblatt business daily.

SWIFT is a network that enables financial institutions worldwide to send and receive information about financial transactions based in Belgium. The system’s management claims SWIFT remains politically neutral and independent.

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There have been reports that despite such claims, the United States has enough power to block transactions through SWIFT. In 2012, the Danish newspaper Berlingske wrote that US authorities managed to seize money being transferred from a Danish businessman to a German bank for a batch of US-sanctioned Cuban cigars. The transaction was made in US dollars, which allowed Washington to block it.

The German Foreign Minister’s words come as the US pulled out of the Iran nuclear deal, and re-imposed sanctions against Tehran. The EU remains committed to the deal despite Washington’s political pressure. “Every day the deal is alive is better than the highly explosive crisis that would otherwise threaten the Middle East,” Mass wrote.

The EU has enforced the so-called Blocking Statute to protect its firms operating in Iran from US sanctions against the country. However, European companies like Total, Maersk and others quit Iran for fear of US sanctions. These firms are dependent on the US-dominated international banking system and international financial markets.