Trade Sanctions: A Minor Hindrance or Complete Disaster

Johan Van Rooyen,Amrita Nath

doi:10.11648/j.ijebo.20200803.14

Abstract

This paper looks into the impacts trade sanctions have on a country, in particular the economic and financial impacts. The question raised is whether trade sanctions indeed have impact of reducing the economic welfare of a country and if so to what capability? Two cases of trade sanctions have been examined: UN sanctions on Iraq and US sanctions in Iran. The analysis suggests that the despite affecting the economy of the target country, the extent to which it impacts in damaging the economic and financial resources depends upon the type and severity of the sanction. In Iraq, the complete comprehensive multilateral trade sanction crippled its economy and financial pushing it into a state of grave fiscal and humanitarian crisis. In Iran, the unilateral trade sanctions imposed by US in the form of trade barriers, has impacted by the country but economic and financial growth continues with Iran’s other trading partners.

Highlights

Economists and political theorists write extensively about trade sanctions 1 and the role it plays in the international global economy
We examine the impact of United Nations trade sanctions on Iraq during the 1990s after the Gulf War
Johan Van Rooyen and Amrita Nath: Trade Sanctions: A Minor Hindrance or Complete Disaster economic sanctions were imposed but with the authorisation of petroleum and petroleum exports, in order for Iraq to be able to pay for their medical, food and civilian supply imports

Summary

Introduction

Economists and political theorists write extensively about trade sanctions 1 and the role it plays in the international global economy Despite their many flaws, sanctions have been used extensively by used by developed countries, such as the United States, Europe and international organisations such as the United Nations and the European Union. Sanctions have been used extensively by used by developed countries, such as the United States, Europe and international organisations such as the United Nations and the European Union It has especially been utilised as a preferred form of foreign policy tool (see Figure 1) in 21st century contemporary global politics. Trade sanctions can either be unilateral meaning one initiator imposing on one target country or it can be multilateral, multiple initiators (countries) serving trade ties with numerous target countries. It can take the form of trade barriers, tariffs or financial restrictions

Literature Review

UN Sanctions

United States Sanctions

Findings

Conclusion