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Korea joins US-led sanctions to ban Russia's access to SWIFT

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People from a civic group and Ukraine stage a protest rally near the Russian Embassy in Seoul, Monday, over Russia's invasion of Ukraine. Yonhap
People from a civic group and Ukraine stage a protest rally near the Russian Embassy in Seoul, Monday, over Russia's invasion of Ukraine. Yonhap

Seoul also plans to ban exports of strategic materials to Moscow

By Kang Seung-woo

Korea has decided to participate in the international community's move to block select Russian banks from a global payments network as part of efforts to stand in line with global sanctions against Russia for invading Ukraine, Seoul's foreign ministry said Monday.

In addition, Korea also plans to ban exports of strategic materials to Russia.

The decision came days after the United States and its key allies, including Germany and Britain, announced Saturday (local time) that they would remove some Russian banks from the SWIFT bank messaging system. SWIFT stands for the Society for Worldwide Interbank Financial Telecommunication that facilitates rapid cross-border payments.

President Moon Jae-in said, Thursday that Korea will join international sanctions against Russia in protest against its military aggression.

"The Korean government will join the international community's move to remove Russia from the SWIFT and its specific plan will be decided following relevant ministries' discussions," the Ministry of Foreign Affairs said in a statement.

The ministry added that the government had notified the U.S. of its decision via a diplomatic channel.

There is widespread speculation that the SWIFT exclusion will hit Russia's economy hard immediately as it will need to use "a telephone or a fax machine" to make payments, according to the White House. In addition, the measure is expected to hamper Russia's ability to profit off oil and gas production that accounts for more than 40 percent of its revenue.

When it comes to export controls on strategic materials, Seoul is expected to ban shipments to Russia of strategic materials singled out by four multilateral export control regimes ― the Nuclear Suppliers Group (NSG); the Wassenaar Arrangement (WA); the Australia Group (AG); and the Missile Technology Control Regime (MTCR).

They seek to fend off the spread of weapons of mass destruction, their delivery vehicles and related technologies and equipment.

Also, Korea is reviewing whether to bar non-strategic materials that include semiconductors, computers, telecommunications and information security equipment, lasers and sensors, and cover items produced in the U.S. or foreign items produced using American equipment and software.

Besides, the government has also decided to release strategic oil reserves and review reselling liquefied natural gas to Europe in order to stabilize the global energy market.

The ministry also said it will beef up humanitarian assistance in cooperation with the international community.

Ukraine is one of the Korea International Cooperation Agency's partner countries.

Meanwhile, the government will seek close consultations with the U.S. to receive an exemption from Washington's recently expanded sanctions against Russia to minimize the impact of the restrictions on local firms and the economy.

Last week, the U.S. government announced the Foreign Direct Product Rule for all of Russia as part of sweeping export controls, which requires companies to receive a license from the U.S. for tech-related items using American technology before they can be shipped to Russia.

However, Korea has failed to make the exemption list unlike other U.S. allies such as Japan and Taiwan.

Earlier, Washington announced restrictions on exports of U.S. origin technology and products to 49 Russian military entities, including its defense ministry, under a policy of denial.

Washington is known to have requested Seoul take such strong export control measures against Moscow.

Kang Seung-woo

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