TOKYO -- Amid its invasion of Ukraine, the Russian government on March 7 designated Japan as among 48 countries and regions "engaging in unfriendly activities toward Russia," according to Russian government news agency Tass.
The move by Moscow, which comes in response to sanctions following its invasion of Ukraine, will make it possible to repay creditors in designated countries and regions in rubles. Russia will also tighten restrictions on transactions with companies and other organizations from the listed nations and areas.
The move is apparently aimed at preventing Russian borrowers from defaulting on foreign currency-denominated debt, but may cause confusion since the ruble's value has plummeted in the invasion's wake.
Russian President Vladimir Putin instructed the government to create the list of unfriendly countries and regions in a March 5 executive order. In addition to the U.S., Canada, the U.K., EU nations and Ukraine, it includes Asian countries and regions including Japan, South Korea and Taiwan.
With this measure, Russian government agencies, companies and other bodies will be able to open special accounts to repay debts to listed countries and regions in rubles. The measures apply to payments over 10 million rubles (about $76,000) per month, and it is unknown if creditors will be able to refuse.
A March 7 ordinance implemented by the Russian government requires approval from the Government Commission on Monitoring Foreign Investment for Russian firms to do business with foreign companies and individuals in listed countries and regions. The government panel can reportedly decide based on applications whether to approve the transaction as well as impose conditions. According to Tass, the Russian government explained the move is to ensure the country's financial stability amid pressure from international sanctions.
(Japanese original by Naoya Sugio, Editorial Division)