Economic sanctions have long been a means utilized by countries and International governmental organizations to exert influence over other states or economic powers, better their own self-interest and security, as well as to attempt to deter human rights violations or actions seen as negative towards the international community. Economic sanctions can range in severity from the embargo of goods produced by private institutions, to the freezing of assets and the near total embargo of a good, travel, or even trade from a state as a whole.
The United States issues more sanctions than any other state or organization in the world. The United Nations and the European Union also issue sanctions on a large scale. Much of the time, sanctions are viewed as a powerful tool of influence for foreign policy makers. But in viewing sanctions as simply a means to an end, the true nature of sanctions and the impact they have on the economy and population of the targeted state can go under the radar.
Perhaps one of the most heavily sanctioned nations in the world is Iran. Next to Cuba, the United States sanctions brought against Iran are the longest lasting economic sanctions “program” in the history of the U.S. Economic sanctions were first levied against Iran in the midst of the Iran hostage crisis, and were initiated by President Jimmy Carter. Since then, the sanctions have been consistently renewed and the penalties increased, though the reasoning behind them has evolved. Much of the sanctions brought against Iran are due to agreements in the Iran-Iraq Non-proliferation Act of 1992, which specifies that sanctions be brought against any person or entity that helps Tehran in the acquisition of weapons or their development. A goal of the sanctions was to bring the Iranian government to the negotiating table regarding their weapons program, with the hopes of coming to an agreement that would allow inspections into the nuclear program, to see that the production of WMD’s is not occurring.
Some of the most severe economic sanctions brought against Iran include the 1995 U.S. trade embargo, which prohibits the majority of U.S. firms from trading or investing in Iran. Following September 11th, 2001, Iranian assets in the U.S. were frozen, and travel bans were put into place. Furthermore, Iran or any institution having dealings with Iran is prohibited from using the U.S. dollar, which spells disaster for international banks, because of the dollars strength. Probably the most punishing sanction brought against Iran has been the embargo on Iranian oil exports. Before the sanctions, oil made up half of the Iranian governments revenue, and since the embargo Iranian exports of oil have more than halved.
While the goals of the sanctions levied against Iran are for the most part based on the intention of eliminating or preventing the development of a nuclear weapons program, and for facilitating nuclear arms proliferation in the country, the economic impact of sanctions on Iran and its people have been devastating.
The additional sanctions brought against Iran have resulted in a loss of $17.1 billion in revenue. Iranian foreign investment fell to almost nothing in 2012, from its previous 4 billion. While these figures largely represent blows to the Iranian oil market, the effects of the sanctions trickle down to the population as a whole. Strict sanctions can effectively impoverish a civilian population, and make it difficult to acquire, or deprive them of adequate food, technology, and health care. Not only are the Iranian people negatively impacted, but also it has been estimated that if the oil embargo on Iran were to be lifted, world oil prices would drop by 14 percent.
With all of this in mind, the question that may be asked is are sanctions a truly effective means by which states and international governmental organizations can persuade an “errant” state or institution into cooperation? Or are sanctions more a means of posturing; a display of power, and a method of isolating and shaming nations in the international community than an effective tool for incentivizing cooperation? If so, are the negative impacts that sanctions have for the targeted states economy, the world economy, and the civilian population worth those costs? And, do you think the recent Nuclear deal with Iran will culminate to any economic sanctions being lifted?