SWIFT, the U.S. Dollar, and the Global Political Economy of Trade

Barclay discusses the relationship between the US dollar and the global political economy of trade. Those using international wire transfers to send or receive money may have heard of SWIFT, the Society for Interbank Financial Telecommunications. But most have only heard of SWIFT when Russia invaded Ukraine. SWIFT was mobilized as one weapon in the financial sanctions applied to Russia. To understand SWIFT's role in the sanctions, it is best to begin with the role of the US dollar in the global political economy. The dollar occupies a unique place in the global financial system, and it is dominant in global trade as well as international investment and asset valuation. In effect, the dollar functions as a global or world currency, just as the UK pound sterling did throughout much of the 19th century and the first half of the 20th century.