Japan extends Russia's exemption from most-favored-nation trade regime

The Japanese government has decided to extend its decision to exclude Russia from the most-favored-nation (MFN) trade status for another year due to the events in Ukraine.

The decision was made during a cabinet meeting on March 28. This will be the third extension of the measure, Caliber.Az reports via Japanese media.

The decision will take effect on April 1, when the new fiscal year begins.

The MFN status was granted to Russia as a WTO member, based on one of the organization's core principles, which requires granting the same trade conditions to one country as those enjoyed by other members. Russia had benefited from MFN status since it became a WTO member in 2012.

Japan excluded Russia from the MFN status, meaning that Russian goods will face higher customs duties, starting in 2022, due to the events in Ukraine.

​In April 2022, Japan's parliament revoked Russia's "most favored nation" (MFN) trade status in response to Russia's invasion of Ukraine. This action removed Russia's benefits, such as low tariffs and minimal trade barriers, aligning Japan with international sanctions against Russia. ​ 

The revocation led to increased tariffs on all Russian imports. For example, the tariff on salmon rose from 3.5% to 5%, and on crabs from 4% to 6%. However, imports of crude oil, liquefied natural gas, and palladium remained unaffected, as they were not subject to tariffs even before the MFN status was revoked. ​ 

In March 2023, Japan extended these trade sanctions against Russia for another year, maintaining the higher tariffs due to the ongoing conflict in Ukraine.

By Khagan Isayev