Denmark to ban trade in kroner with Russia to prevent sanctions loophole
Denmark is to pass a law banning the trade of cash and securities in kroner to Russia and Belarus, the Danish Ministry of Industry, Business and Financial Affairs said on Tuesday.
Under economic sanctions put in place following Moscow’s invasion of Ukraine, a ban on selling cash and tradeable financial assets in euros to Russia and Belarus has been put in place by the EU.
Copenhagen will now act to pass an emergency bill preventing similar transactions using the Danish krone, the business ministry confirmed in a statement.
The fixed exchange rate policy with the euro means that the krone can be used as a shadow currency for the euro, meaning it can be used to circumvent sanctions placed on Russia in response to the invasion of Ukraine.
“The hard economic sanctions are a strong weapon against Putin and we support the hardest possible sanctions in Denmark,” business minister Simon Kollerup said in the statement.
“We can see that Russia’s economy has been hit hard and the Russian currency has dropped in value with the effect that rich Russians are looking out for other places to move their fortunes,” he said.
“We have already closed the door to the EU and the euro, and with this bill we ensure that Denmark will not become a loophole,” he said.
The government has requested expedited processing through parliament of the bill, which would apply equivalent restrictions on trade with the krone to those already in place with the euro.
The bill will be tabled on Tuesday, the ministry said.
Comments
See Also
Under economic sanctions put in place following Moscow’s invasion of Ukraine, a ban on selling cash and tradeable financial assets in euros to Russia and Belarus has been put in place by the EU.
Copenhagen will now act to pass an emergency bill preventing similar transactions using the Danish krone, the business ministry confirmed in a statement.
The fixed exchange rate policy with the euro means that the krone can be used as a shadow currency for the euro, meaning it can be used to circumvent sanctions placed on Russia in response to the invasion of Ukraine.
“The hard economic sanctions are a strong weapon against Putin and we support the hardest possible sanctions in Denmark,” business minister Simon Kollerup said in the statement.
“We can see that Russia’s economy has been hit hard and the Russian currency has dropped in value with the effect that rich Russians are looking out for other places to move their fortunes,” he said.
“We have already closed the door to the EU and the euro, and with this bill we ensure that Denmark will not become a loophole,” he said.
The government has requested expedited processing through parliament of the bill, which would apply equivalent restrictions on trade with the krone to those already in place with the euro.
The bill will be tabled on Tuesday, the ministry said.
Join the conversation in our comments section below. Share your own views and experience and if you have a question or suggestion for our journalists then email us at [email protected].
Please keep comments civil, constructive and on topic – and make sure to read our terms of use before getting involved.
Please log in here to leave a comment.