After Scott Morrison placed financial sanctions on Russia, Vladimir Putin is doing the same to Australia – and a long list of other countries.
To get back at all the countries that placed sanctions on Russia and condemned the invasion of Ukraine, Vladimir Putin is introducing his own sanctions on more than 25 different countries.
Among those affected are: Australia, Albania, Andorra, Great Britain, Anguilla, British Virgin Islands, Gibraltar, EU member states, Iceland, Canada, Liechtenstein, Micronesia, Monaco, New Zealand, Norway, South Korea, San Marino, North Macedonia, Singapore, US, Taiwan, Ukraine, Montenegro, Switzerland, and Japan.
But don’t worry, it doesn’t look like you’ll have to panic buy vodka just yet. The sanctions will allow Russians or Russian companies that owe money to a foreign creditor (a person or business that has lent money), to pay them back in rubles, the currency of Russian.
Essentially this means that Russian borrowers will not have to convert their repayments, because nobody wants to trade for Russian rubles at the moment given the value is in dramatic decline.
Putin has signed a decree to allow such repayments to his ‘hit-list’ of countries to avoid a mass number of defaults that could leave Russians unable to borrow money in the future.
This will mainly affect Australian superannuation companies who Russia hold debts with, but the NSW government is planning to sell its shares in Russian assets.
Putin has explained these sanctions, stating, “These sanctions that are being imposed are akin to a declaration of war, but thank God it has not come to that.”
Scott Morrison has warned that his sanctions against Russia will continue to increase. “We must ensure there is a cost for this violent, unacceptable, and egregious behaviour,” he said.
