Ukraine War: Russia to sanction New Zealand and Australia after 'unfriendly' response to invasion

Under the new rules, any debt to an "unfriendly" country can be paid in roubles, which are now worth virtually nothing. Photo / Getty

Russian President Vladimir Putin has put New Zealand and Australia on a hit-list of countries taking "unfriendly actions against Russia", allowing creditors to repay any debts "in rubles".

Hitting back over punitive economic sanctions announced by western nations in protest against Russia's bloody invasion of Ukraine, officials have drawn up their own list of countries they plan to sanction.

According to a decree published on the government's website overnight, the list includes Australia, Albania, Andorra, Great Britain, including Jersey, 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.

All of the countries on the list have applied tough financial sanctions on Russia that sent the Russian stock market and the rouble plunging in value.

New Zealand announced sanctions yesterday, with the Russia Sanctions Bill that will freeze assets, target oligarchs and even shut off airspace to Russian aircraft. The bill will be passed this week under urgency.

According to New Zealand Prime Minister, Jacinda Ardern, the amount of Russian investment in New Zealand is only about $40 million.

Across the ditch, Australia's Future Fund is in the process of trying to divest $200m of holdings in Russian companies and is likely to be impacted by the changes.

The New South Wales government has also signalled it wants to sell its holdings of Russian assets in its investment funds, while Australian superannuation funds are also caught up in the crisis.

Business dealings in Russia involving Australia and other countries on the list will now require special government authorisation from the Commission for Control over Foreign Investments.

The rules mean Russian citizens and companies, and even the state itself, that have foreign exchange obligations to foreign creditors that are on the list will be able to pay them in rubles.

The new rules for dealing with "unfriendly" countries come after the West imposed heavy sanctions on Russia, crashing the value of the rouble. Photo / Getty

The new government order is temporary and is valid to payments exceeding 10 million rubles (around $77,412).

Russian President Vladimir Putin has previously declared any sanctions on Russia were akin to a declaration of war.

"These sanctions that are being imposed are akin to a declaration of war, but thank God it has not come to that," Putin said.

Australia has denounced Russia's "brutal, unprovoked and unacceptable" invasion of Ukraine as a flagrant breach of international law.

Australian Prime Minister Scott Morrison accused Russia of months of aggression and intimidation leading up to the military attack.

"Together with the international community, we are banding together … to condemn these outrageous acts in the strongest possible terms," he said.

Morrison warned sanctions against Russia would continue to ramp up.

"We must ensure there is a cost for this violent, unacceptable, and egregious behaviour."