Russia Sets up Non-US Dollar Payment System for Turkey's S-400 Purchase

Russia and Turkey are working to create an interbank payment system independent of SWIFT for the S-400 anti-air missile system deal between the two countries.

Russian President Vladimir Putin said in an economic conference Wednesday that Russia would use the new interbank payment system and not the dollar because US administration used it as a pressure tool.

“ ‘Instability in dollar payments’ is prompting ‘very many’ countries to find alternative reserve currencies and create payment systems that are independent from the dollar," Radio Free Europe quoted Putin as saying in the forum.

“Deliveries will begin toward the end of 2019 and we will have actualized our goal of purchasing using local currency,” YeniSafak reported President of Turkey, Recep Tayyip Erdoğan as saying.

The $2.5 billion contract to deliver four batteries of S-400 to the Turkish army was signed in July 2017. Turkey will pay for 45% of the contract value and the remaining 55% will be covered with loan from the Russian Finance Ministry. Turkey had planned to repay the loan within four years, repaying 15% of the loan each year.

S-400 is a Russian long-range air defense missile system designed for elimination of modern and perspective airborne threats. The export name of the missile system is “Triumph.” It can carry three types of missiles capable of destroying targets, including ballistic and cruise missiles. The system can track and engage up to 300 targets at a time and has an altitude ceiling of 27 kilometers (17 miles).