Tariffs, quotas, embargoes, or prohibitions on particular products, services, or financial activities are just a few of the various ways these trade sanctions tend to be exercised. The imposition of trade sanctions is frequently utilized, particularly as a nonviolent means of achieving diplomatic goals altogether.
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Humanitarian and Economic Repercussions
Trade sanctions are more likely to frequently have negative economic and humanitarian effects on the targeted country or organization and the companies and sectors residing in the respective countries that impose them.
What are the Notable Examples of Trade Sanctions?
American Sanctions Against Iran
Economic sanctions that were majorly imposed by the United States on Iran are among the most well-known instances of trade sanctions. Trade sanctions were majorly intended to address the alleged support of Iran for terrorism and to curb its nuclear program, which became much more severe with the passing of time.
Measures specifically included restricting the financial dealings with Iranian banks and reducing Iran’s oil exports, as they were one of the vital sources of income. The economy of Iran experienced a severe contraction, with its currency devaluing, and its inhabitants experienced widespread economic misery due to these restrictions. Meanwhile, critics still consider that the sanctions have not been able to accomplish their intended policy goals despite these circumstances fully.
North Korea sanctions
There is another instance in the history of trade sanctions where the US, the UN, and other countries placed trade sanctions on North Korea. Where these measures targeted the violations of human rights and the nuclear weapons program being done by North Korea. These prohibitions included freezing assets, which were on officials and entities, and prohibition on exports, which included coal, textiles, and seafood. Trade sanctions of such a nature have not stopped the leadership of North Korea from pursuing its military and nuclear goals, which has completely highlighted the difficulties in ensuring sanction compliance despite hindering economic development.
Cuban Embargo
One of the oldest trade restrictions that have taken place in history was in the year 1960 when the U.S. put an embargo on Cuba. This particular embargo was put in place after the Cuban Revolution, and later, the nationalization of American-owned property happened, which ultimately limited the travel, commerce, and financial interactions between these two countries. Critics contended after this embargo that it has disproportionately hurt Cuban civilians by restricting their access to products and hampering economic prospects, even though it was designed to put pressure on Cuba to implement democratic reforms. The embargo remained mostly in place even if some limitations were loosened during the Obama administration and then reinstituted.
Russia-related sanctions
Another important example of global trade sanction is the sanctions imposed on Russia. Western countries, particularly the U.S., EU, and Canada, have imposed severe sanctions in the past on account of the invasion of Russia into the territory of Ukraine, which happened in the year 2022 and its annexation of Crimea in 2014. These limitations were imposed on financial transactions, technological exchanges, and energy exports simultaneously. Russia has attempted multiple times to tone down the consequences of these sanctions simply by fortifying its ties with non-Western trading partners, even though they have cut off Russia from international financial markets and caused economic disruption.
Challenges and Criticisms of Trade Sanctions
Humanitarian Concerns
Ordinary residents of that particular country are frequently impacted by the sanctions end up resulting in shortages of necessities like food and medication. Let us take an example of a sanction which was imposed on Iran in the year of 1990, which resulted in major starvation and health concerns as well.
Avoidance and Failure to Comply
Targeted organizations are more likely to frequently utilize smuggling, illegal commerce, or other financial networks to get around restrictions. Cryptocurrency has also become a viable means for circumventing conventional financial constraints.
Limited Efficiency
Critics have contended that sanctions hardly ever accomplish the political goals they are actually meant to.
A Rebound in the Economy
Countries that are specifically involved in imposing the sanctions do have a tendency to face economic repercussions, such as the sanctions on Russia, which caused a large loss of revenue for European companies simultaneously.
