In The News

How Will Sanctions on Russian Banks Hit Latin America?

Financial Services Advisor

23 Mar 2022

John Smith spoke to Financial Services Advisor about how sanctions imposed by the United States and the European Union on banks in Russia in the wake of its invasion of Ukraine could wind up punishing Latin American countries that are allied with Russia.

“The global tidal wave of sanctions imposed on Russia appears destined to upend trading relationships in Europe, Asia and North America, but Latin America will face significant and potentially long-lasting disruptions as well,” John said.

He added: “In recent decades, Russia has been more active in the region than perhaps ever before. Some of these trade difficulties may be resolved relatively easily. If your trading partner’s bank in Russia has been sanctioned or removed from the SWIFT network, you can simply find another bank operating there—particularly subsidiaries of non-Russian banks that are very unlikely to ever be sanctioned. But countries such as Venezuela that have depended on their lifeline to Russia may find it particularly challenging to move forward without the same level of Russian support. Other countries across the region also may feel the pain as agricultural and other key imports from Russia and Ukraine are disrupted.”

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