(Bloomberg) — Japan will revoke the “most-favored nation” trade status for Russia, stripping it of basic World Trade Organization rights and adding to the punishments Tokyo has imposed on Moscow for its invasion of Ukraine.
Russia’s aggression is “an inhumane act that should be engraved in history,” Prime Minister Fumio Kishida told a news conference Wednesday. He said Japan would freeze the assets of more Russian oligarchs and set up a system to accept refugees from Ukraine, with local governments already volunteering to help.
Russia is a minor trading partner for Japan, but a key supplier of energy items such as crude oil, liquefied natural gas and coal that help power the world’s third-largest economy.
“For a net importer of energy and food like our country, there is concern about the effect on the economy and livelihoods,” Kishida said. “But in order to show we are with the Ukrainian people, and to protect the peace and order of the international community, we must not yield to Russian threats.”
Japan will ban exports of luxury items to Russia and halt imports of certain items from Russia. The government will work with other Group of Seven countries to make sure Russia doesn’t receive funds from the International Monetary Fund or other major international financial institutions, Kishida added. It will seek to close any potential loopholes in sanctions by cooperating with crypto-currency exchanges, he said.
Surveys show sanctions on Russia are extremely popular with the public, with a poll published by national broadcaster NHK on Monday finding 42% of respondents saw them as appropriate, while 40% said they should be tougher.
Kishida said his government had already acted to reduce the effect of rising oil prices on the Japanese people and would respond on price increases for energy, raw materials and food if the situation continues. He added the current weakening of the yen could burden consumers with higher import prices.
Asked about his stance on Japan’s Sakhalin-2 joint venture with Russia’s Gazprom, he said the project was important for the country’s energy security.
The Unprecedented End of Russia’s Basic Trade Rights: QuickTake
Kishida also called for China to act “responsibly” during the Ukraine crisis and said Japan wouldn’t stand for the use of force to change the status quo in Asia, in a veiled reference to concern that Beijing may act on Taiwan.
Earlier this week, Japan announced details of its export ban on semiconductors, machinery and materials against Russia, as it stays in line with U.S. and European Union sanctions intended to deter President Vladimir Putin from continuing his assault. The ban, set to take effect on March 18, will apply to about 270 items used in categories such as nuclear power, electronics and communications, the trade ministry said Tuesday.
Belarus is included in the sanctions Japan has taken against Russia as the international community tries to isolate the Kremlin and its ally.
Japan Reveals Details of Chip, Machine-Tool Ban on Russia (1)
Last week, U.S. President Joe Biden said he would ban imports of Russian vodka, caviar and diamonds and called on American lawmakers to join allies in revoking the country’s preferential trade status following the invasion. The U.S. effort was happening in concert with EU and Group of Seven nations, Biden said.
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