Economic sanctions are a double-edged sword

No topic is more pressing lately than the introduction of economic sanctions. At the same time, few understand the forms, methods and goals of these sanctions. Restrictions always affect both sides, affecting the economy, the business climate and consumer sentiment. Figuratively speaking, sanctions are a weapon that shoots both ways. 

Economic sanctions - concept and objectives

Economic sanctions are measures of economic nature applied by one or more countries against another country or group of countries. Economic sanctions can take the form of total or partial bans on imports of goods from a country, exports to a country, and restrictions on financial transactions.

The purpose of sanctions is to force the government of the country on which the sanctions are imposed to change its policies in various areasThe following: withdrawal of troops from occupied territory, an end to human rights violations, an end to all forms of support for international terrorism, and so on.

Strange as it may seem, international law has no precise definition of economic sanctions: each case of their application is subject to separate consideration.

Sanctions can be imposed unilaterally by a decision of a country's president, government, or legislature. It is possible for several states to impose sanctions. Nevertheless, Only sanctions adopted by the UN Security Council have official international status. In theory, they are the most effective, because they are binding on all UN member states. In practice, the effectiveness of such sanctions depends on the specific countries that are trade partners of the "fined" state, since the UN Security Council has no effective methods to influence the violators of the sanctions regime.

History of economic sanctions

The first mention of economic sanctions in written sources is found in 432 B.C. The sanctions were adopted by the Athenian Maritime Union against the city of Megara, in order to stop in this city the harboring of runaway slaves from Athens and the plowing of the border territories, considered sacred. It is worth noting that the sanctions imposed had the opposite effect. The Merchants of Megara were forced to seek military assistance from their ally, Sparta, and as a result of the Peloponnesian War Athens was defeated

In the Middle Ages economic sanctions were not widespread, due to the lack of a permanent configuration of military and trade alliances. In the 19th century, economic sanctions took the form of naval blockades. Over a period of nearly a century, naval blockades were carried out: 12 times by Britain, 11 times by France, 3 times by Germany and Italy, 2 times by Russia and Austria, and once by Chile.

In the 20th century, against the backdrop of booming international trade, economic sanctions became widespread. The most striking example of collective sanctions is the restriction of supplies of strategic technology and goods to the countries of the socialist bloc. A special committee of 17 countries was organized to oversee these sanctions.

The clearest example of unilateral sanctions is the U.S. embargo against Cuba, introduced in 1960 and still continuing. The damage to Cuba caused by U.S. sanctions is estimated at $1 trillion. Nevertheless, the main goal of the embargo - the establishment of a democratic regime in Cuba - has never been achieved.

Beginning in 1990, the UN Security Council began to use international economic sanctions more actively against various countries: Iraq (since 1990), Yugoslavia (1991-2001), Somalia (since 1992), Libya (1992-2003), Liberia (since 1992), Angola (1993-2002), Haiti (1993-1994), Rwanda (1994-2008), Sierra Leone (since 1997), Afghanistan (since 1999), Eritrea and Ethiopia (since 2000), DR Congo (since 2003), Ivory Coast (since 2004), Sudan (since 2004), Lebanon (since 2005), Iran (since 2006), DPRK (since 2006).

The sanctions imposed by the UN are mostly partial and are aimed at restricting the supply of military equipment and weapons to these countries, as well as freezing assets deployed abroad.

The impact of economic sanctions on Russia

Let us look at some very recent examples. The U.S. and the EU have imposed sanctions against a number of Russian banks. What effect will this have on the average citizen?

Imagine that your salary was reduced by 5,000 rubles. You won't starve to death, your standard of living will slightly decrease, but your lifestyle, in general, is unlikely to change. In the short term, there seems to be nothing to worry about. However, if you take a longer time period, it turns out that for 10 years you have lost enough money to buy a new car. The sanctions have a pronounced damage, but not felt immediately. In the end, it will turn out that the ten-year sanctions period could have been lived much better.

Take the restrictions on imports from the EU and the U.S. imposed by Russia. Without touching the political background, let us consider their possible consequences, as they say, "on the fingers.

Imagine that instead of buying certain products, you have to grow them yourself. It would seem that there are no difficulties at all. For example, anyone who has a small plot of land can grow potatoes. But your standard of living from this, of course, will go down. Judge for yourself, the effort that previously went to work, you will be forced to spend on the garden, although previously bought vegetables, and still have money left. Products that used to be bought in countries where their production was better, now you will have to produce yourself. As a result, we produce a lower quality product ourselves, in addition to spending the resources that were previously devoted to a cause that was better than the rest.

Or the opposite situation with the same import restriction, only in this case for exports. You have a plant for the production of milk and dairy products. The volume of your production is such that you feed the people of your country and a couple of neighboring countries. And suddenly one of your partners loses interest in your product, banning its distribution in their territory. What happens?

As you know, goods are produced and sold in advance, which means that you have an overabundance of milk in storage, which has nowhere to go. Of course, you can sell it on other markets, but the shelf life of products is not eternal, and stocks are significant. In addition, you need to reduce production, because now you do not need as much milk. And that means layoffs, downtime, not to mention direct losses. And what if other neighboring countries refuse to buy the same volumes because they themselves are under sanctions?

The practice of modern international relations considers that the greatest effect is produced by economic sanctions aimed not at the country as a whole, but at its leadership: freezing their foreign assets, refusal to invest, and a ban on entry into the country. Economic sanctions of a harsh nature and aimed at undermining the economy of a state are recognized as inhumane, since the population, mainly the poorest strata, suffers most from them.