The global food crisis is getting so bad that the European Union now wants to reconnect a sanctioned Russian bank to the global financial system to keep grain supplies flowing.

• The European Union wants to reconnect a sanctioned Russian bank to the global financial system.

• The bloc is trying to get Putin’s support to extend the Black Sea grain deal, which is due to expire soon.

• The deal allowed the export of Ukrainian food products from its ports amid a blockade by Russia.

the Global food supply crisis It got so bad that the European Union wants to reconnect a sanctioned Russian bank to the global financial system — a link that was severed when the country invaded Ukraine last year — The Financial Times reported on Monday, Quoting five knowledge from the discussions.

The concessionaire wants to allow the state-owned Agricultural Bank of Russia to process payments related to grain exports.

Under the proposal – initiated by Moscow and brokered by the United Nations – a new subsidiary of the bank would also be allowed to use SWIFT, the global messaging system, which Russian banks are banned from Using after the country’s invasion of Ukraine, according to FT.

Suggesting allowing the Russian bank access to the global financial system is the “least worst option” for securing Russian President Vladimir Putin’s support for an extension of Black Sea Beans Deal which expires on July 18 this year, two sources told the Financial Times.

cereal deal – which allowed passage of food and fertilizer from three major Ukrainian ports – hit in July 2022 to allow Ukraine to continue exporting its food products to the global market amid food crisis.

previously, Ukrainian grain shipments have stopped at the country’s ports Russia has closed some major shipping routes in the Black Sea.

The proposed concession to allow the Agricultural Bank of Russia to return to the SWIFT system highlights the difficulties the international community is facing over sanctions against Moscow.

The news of the possible abdication came as Gennady Gatilov, Russia’s envoy to the UN, told L.N Pro-Kremlin Izvestia There are no reasons to maintain the “status quo” of the Black Sea Grain Deal.

Story continues

Gatilov said re-linking the Agricultural Bank of Russia to SWIFT was one of the conditions for extending the agreement, according to a report on Monday.

Gatilov told the newspaper “Izvestia”, according to A.S Reuters translation. “However, what we are seeing now does not give us reasons to agree to maintain the status quo.”

Russia is a major commodity exporter, ranging from energy to agricultural products. While the supply chain has been in turmoil since the COVID-19 pandemic began in 2020, the disruptions have been exacerbated by the war between Russia and Ukraine, both of which are major wheat exporters.

the Food price index of the Food and Agriculture Organization of the United Nations – which tracks a basket of commonly traded commodities – hit a record high of 159.7 in March 2022, though the index slipped back to 124.3 in May 2023.

The European Commission and the Russian Agrarian Bank did not immediately respond to requests for comment from Insider.

Read the original article at Business interested