Embargo Research Articles

Institutional Foundations for the Formation of a Resource-Innovative Model for the Development of the Economy of Russia and Its Regions

Relevance. Global and tectonic shifts in the world economy that occurred in the XXI century in the world inevitably reflected on the state of national economies. The Russian economy, over a decade of economic sanctions against it, which are practically open-ended sabotage by the United States and a number of Western countries against the Russian critical infrastructure - the Nord Stream 2 gas pipeline on September 26, 2022, has found itself in a situation of de facto complete stoppage of export-import operations in the field of foreign trade with European countries.The purpose is to study the institutional foundations of the formation of a resource-innovative model of economic growth in the modern Russian economy. The objectives are interrelated and consist in the following: to analyze an array of economic scientific papers on the problem of research; to analyze the institutional foundations for the formation of a resource-innovative model of the development of the Russian economy; to determine the dynamics of budget financing of scientific research for the period from 2012 to 2022, etc. Methodology is a combination of general scientific research methods – analysis, synthesis of received information, interpretation of data. The information base of the study includes presidential decrees, strategic planning documents, national projects, scientific articles by Russian researchers on the problem under study. Results: the main problems of forming a resource-innovative model of economic growth in Russia at the present stage of economic development are identified; the shortcomings of the state policy in the field of financing R&D, innovative solutions and products that hinder the activities of innovative enterprises in the real sector of the economy are revealed.Conclusions. The Russian economy remains raw in its essential content. However, the introduction of digitalization technologies, artificial intelligence, new ideas and knowledge are gradually forming a resourceinnovative model for the development of the Russian economy.

Проблемы и перспективы реализации проектного финансирования в России в условиях нарастающих экономических санкций

Relevance: In recent years, Russia has faced a number of economic sanctions that have had a significant impact on its economy. These sanctions have restricted access to international financial markets, making it difficult to attract investment and realise projects. Project finance plays a key role in economic development, enabling companies to raise the necessary resources to realise major investment projects. However, in the context of sanctions, the effective use of this instrument is becoming a challenge. In a changing economic environment, companies and organisations need to adapt and seek new approaches to financing their projects. Researching this topic can help in finding effective solutions, as well as understanding how sanctions affect project finance and what strategies can be used to overcome these challenges. The purpose of this article is to analyse the current state of project finance in Russia and the world and to determine its prospects in the context of growing economic sanctions. Research methods: Statistical, economic and comparative analyses were used to identify trends in the global and Russian project finance market, as well as to determine the main problems and potential areas of development, The results of the article are based on the analysis of works of domestic and foreign economists and professional organisations in the field of project finance and economics in general. The results obtained can be used to identify further directions of project finance development, as well as to study the experience of work and organisation of project finance under sanctions.

ВЛИЯНИЕ ФИНАНСОВЫХ САНКЦИЙ США НА ТРАНСГРАНИЧНУЮ ЭЛЕКТРОННУЮ ТОРГОВЛЮ МЕЖДУ КИТАЕМ И РОССИЕЙ

This article analyzes the impact of financial sanctions on cross-border electronic commerce using Russia and China as examples. The authors examine both primary and secondary financial sanctions, as well as the problems arising in cross-border electronic commerce due to the exclusion of Russian banks from the SWIFT system. They also discuss alternative payment systems such as SPFS (Bank of Russia's Financial Messaging System) and CIPS (Cross-Border Interbank Payment System), which aim to replace SWIFT. Additionally, the article notes a decrease in the activity of major trading platforms in the Russian market in the context of sanctions against Russia, indicating serious challenges for cross-border electronic commerce that may lead to reduced trade volumes between the countries and complicate business processes.

Research issues of the region as an adaptive socio-economic system

Aim. To consider the issues of regional management in the modern conditions of the country’s economic development, which are characterized, on the one hand, by objective factors of the world economy development, such as dynamism, complexity, instability of the foreign economic environment, on the other hand, by the unfriendly attitude of a number of Western countries, which is expressed primarily in the application of economic sanctions to Russia.Objectives. To identify the main directions and peculiarities of the positions of various domestic and foreign authors regarding the issues of the study of the region as an adaptive socio[1]economic system; to formulate the functions and properties of the region as a system.Methods. The authors used empirical and analytical methods of research, defined the region from the position of the system approach.Results. The author’s vision of key properties of the region as a socio-economic system is presented, their description from the position of regional management is given. The existing approaches are analyzed and the peculiarities of the organizational and economic structure of management of the region as a system are defined, and the directions of its development in the conditions of unstable market environment are highlighted.Conclusions. There is an obvious need to form a new methodology of regional management on the basis of the system approach, taking into account the peculiarities of modern economic realities. The first step to this is the substantiation of the region as an open socio-economic system. The idea of expediency of further improvement of the mechanism of regional management on the basis of the principles of adaptation and self-organization is put forward.

Temporal characteristics and health effects related to NO2, O3, and SO2 in an urban area of Iran

This study reports on temporal variations of NO2, O3, and SO2 pollutants and their related health effects in urban air of Khorramabad, Iran using AirQ 2.2.3 software. Based on data between 2015 and 2021, hourly NO2, O3, and SO2 concentrations increase starting at 6:00 a.m. local time until 9:00 p.m., 3:00 p.m., and 7:00 p.m. local time, respectively, before gradually decreasing. The highest monthly NO2, O3, and SO2 concentrations are observed in October, August, and September, respectively. Annual median NO2, O3, and SO2 concentrations range between 17 ppb and 38.8 ppb, 17.5 ppb–36.6 ppb, and ∼14 ppb–30.8 ppb, respectively. Two to 93 days and 17–156 days between 2015 and 2021 exhibit daily concentrations of NO2 and SO2 ≤ WHO AQGs, respectively, while 187–294 days have 8-h maximum O3 concentrations ≤ WHO AQGs. The mean excess mortality ascribed to respiratory mortality, cardiovascular mortality, hospital admissions for COPD, and acute myocardial infraction are 121, 603, 39, and 145 during 2015–2021, respectively. O3 is found to exert more significant health effects compared to SO2 and NO2, resulting in higher cardiovascular mortality. The gradual increase in NO2 and possibly O3 over the study period is suspected to be due to economic sanctions, while SO2 decreased due to regulatory activity. Sustainable control strategies such as improving fuel quality, promoting public transportation and vehicle retirement, applying subsidies for purchase of electric vehicles, and application of European emission standards on automobiles can help decrease target pollutant levels in ambient air of cities in developing countries.

Эволюция эмпирических подходов в оценке эффективности международных санкций

Economic sanctions lead to a redistribution of public welfare, as well as change the political decision-making process, since certain groups in each country lobby their interests, benefiting from sanctions pressure. Empirical models of sanctions analysis are based on the theory of public choice, which allows for a comprehensive assessment of their effectiveness. The results of the analysis showed that a feature of the studies of sanctions wars is the use of fundamental economics and political science, as well as game-theoretic models as a basis for analyzing the complex effect of sanctions. To maximize the effect, the initiator countries should set clear targets, because otherwise the time horizons of the sanctions wars are maximally prolonged and it will be impossible to predict when the targets will be reached.

Washington's use of the Iraqi sanctions scheme against Russia

The article analyzes the similarity of the scheme of using the instrument of political and economic sanctions by the United States against Iraq and Russia. Sanctions are seen as one of the main instruments of influence of the United States and the collective West on those countries that do not want to submit to the political dictates of Washington and its NATO allies. The question of how exactly they act is being studied. Their ultimate goal. The extent of the impact of sanctions on the economies of both countries. Sanctions as an attempt to weaken the military and economic potential. Differences and similarities in the possibilities of countering sanctions from Iraq and Russia. The elimination and control of WMD as a strategic task of the United States. Ways to get out of the sanctions regime.

Trading with Pariahs: North Korean Sanctions and the Challenge of Weaponized Interdependence

Abstract Why has North Korea avoided capitulating to economic sanctions pressures? We argue that economic sanctions have been ineffective and unsuccessful for three reasons: North Korea’s adeptness at evasion, other states’ unwillingness to enforce economic sanctions, and North Korea’s efforts to avoid panopticon effects via its diplomatic statecraft and policies that allow states to monitor and collect information on others. We contend that the implementation and enforcement of economic sanctions led North Korea to alter its trading network, reallocating trade to countries (or nodes) within its network willing to ignore international sanctions. As a result, these network shifts limited the ability of senders to weaponize the interdependence between them and North Korea effectively. We further highlight how North Korea conducts diplomatic statecraft in such a way that limits the impact of sanctions enforcing states from effectively monitoring it and limiting the impact of panopticon effects senders generate. To test our theory, we employ an ordinary least squares regression followed by social network analysis to understand how North Korea’s network of trade has adapted over time in the face of punishing economic sanctions. We find that states with greater diplomatic engagement enjoy better centrality than sanctions enforcing states. Also, economic sanctions at critical junctures induce changes to North Korea’s network over time with commercial imperatives to trade replaced by a North Korean near reliance on China. We further demonstrate that economic sanctions likely induce changes to the structure of the network as North Korea seeks to insulate itself from the impact of economic sanctions.

Legal Regulation of Parallel Import in the States of the Eurasian Region

The article is devoted to the problem of regulating parallel imports in the countries of the Eurasian region, which is significant in the conditions of the modern world economy. The relevance of this issue is related to the economic sanctions applied to such states of the Eurasian region as the Russian Federation and the Republic of Belarus. The legal regulation of issues of protection of intellectual property rights in Russia, Belarus, Kazakhstan, China, and Azerbaijan is analyzed. Special attention is paid to the consideration of the practice of the Constitutional Court of the Russian Federation, as well as legal acts regulating the rights of both copyright holders and importers and consumers, who are subject to the consequences of certain decisions of copyright holders who do not consent to the import of goods into different states.Aim. Research of the legal regulation of the institution of parallel imports in the states of the Eurasian region in the context of economic sanctions.Tasks. Analysis of regulations governing the protection of intellectual property rights in the states of the Eurasian region, research of the main directions of parallel imports in the states of the Eurasian region, as well as identification of the main legal problems associated with the legalization of parallel imports in the region.Methods. Comparative legal and cross-temporal analysis of international and national regulations in the field of antitrust, copyright and customs law, as well as the study and analysis of general scientific literature and the formation of one’s own conclusions during the research.Results. As a rule, the states of the Eurasian region have established the national principle of exhaustion of rights to a trademark, and the international principle is used as an exception for certain groups of goods. The legalization of parallel imports raises several formal questions about the compliance of permission to import without the consent of the copyright holder with the international obligations of various states.Conclusions. In connection with the introduction of economic sanctions against some states of the Eurasian region, parallel imports are an effective mechanism for protecting the domestic market from abuses by copyright holders who unreasonably deny importers the right to distribute goods. Also, one of the methods to neutralize the consequences of sanctions regulation is to use the markets of other countries in the Eurasian region, which do not directly prohibit parallel imports.

The Commonwealth and Southern African Decolonization 1949–1994

This article addresses the role of the Commonwealth, a unique post-colonial association, in the protracted process of decolonisation in sub-Saharan Africa. It examines the ways in which Commonwealth leaders sought to use the association to enhance their national diplomacy and policy stance on African self-determination: to pressure the British government to adopt more robust policies such as economic sanctions, and to use Common-wealth meetings as a diplomatic forum to coordinate and publicise their stance on decolonisation to their home constituencies, enhancing their domestic legitimacy. The article also addresses the ways in which the Commonwealth evolved in the process of British disengagement from empire, developing a separate identity, political leadership and an international secretariat; and its place in the global struggle against white minority regimes in Southern Rhodesia, Namibia/South West Africa and South Africa.

When Economic Sanctions Cause White-Collar and Corporate Crime: The Case of Hidden Russian Ownership Revealed by a Norwegian Insurance Firm

ABSTRACT Sanctions have criminalizing consequences. This paper addresses the issue of Russian businesses attempting to circumvent and evade sanctions by white-collar and corporate crime. The case presented in this paper concerns a Norwegian smolt production facility owned by Russians, who suddenly transferred ownership to a Norwegian because of the sanctions. It seemed that the Russians remained the real owners since the Norwegian paid nothing for the shares. While Norwegian police were reluctant to investigate the matter, a Norwegian insurance firm became worried that insurance premiums paid by the production facility in Norway could represent money laundering. This paper presents the case of potential money laundering by review of the literature on sanctions and by application of institutional theory. The fact that economic sanctions are problematic in themselves and in addition stimulate white-collar and corporate crime and even mafia business as exemplified in Iran, should be an important consideration against the trend of imposing sanctions on steadily more countries that are different from our countries.

Параллельный импорт: международный опыт

The article discusses the theoretical aspects of the concept of ‘parallel import’ and its legal regulation in other countries. The impact of international economic sanctions in 2022 on the dynamics of the withdrawal of foreign companies from the Russian market is analyzed. The advantages and disadvantages of using parallel imports in the framework of countering economic sanctions are determined.

О некоторых проблемах предпринимательской деятельности в сфере организации воздушного движения

The article analyzes some aspects of entrepreneurship for such business entities as Rosaeronavigation airlines in the context of overcoming the consequences of the covid epidemic and economic sanctions from some foreign countries, which have a negative impact on the activities of transport organizations. Attention is drawn to the underestimation of the peculiarities of the work of enterprises that ensure the organization and safety of aircraft flights in new conditions and the seriousness of the current situation of economic entities involved in providing commercial air transportation.

Креативные практики как активатор импортозамещения машиностроительной отрасли Европейского Севера в условиях санкций

This article analyzes creative practices aimed at fostering the development of machinery manufacturers in the European North against the backdrop of sanctions. The significance of this study arises from the adverse impact of economic sanctions on machinery manufacturers and the imperative to devise strategies for mitigating these negative consequences. The research hypothesis posits that, within the current economic landscape, creative practices can significantly contribute to enhancing business activity and bolstering the potential of machinery manufacturers in the realm of import substitution. The article proposes a methodological approach that integrates both quantitative and qualitative assessments. This approach involves the identification of problems and the determination of development prospects for the machinery industry, utilizing official statistical data in conjunction with insights obtained through case studies. Implementation of such an approach has facilitated the formulation of a list of priority areas for machinery manufacturers. This approach considers the core tenets of the import substitution concept in the context of economic sanctions, regional peculiarities of the industry, and the feasibility of incorporating and disseminating creative practices within it. The study scrutinizes key indicators reflecting the current state of the machine industry in Russian regions and evaluates the propensity of machinery manufacturers toward creative development. Additionally, the article presents case-study results of companies that, through the adoption of creative practices, successfully improved their business activities despite economic sanctions. The scientific novelty of the research lies in the development of the corresponding methodological approach, complemented by a clarification of essential concepts related to the research topic ("creative economy," "creative industries," and "creative practices"), enabling a precise differentiation between them. The practical significance of the research lies in the applicability of its results by machinery manufacturers, particularly those impacted by international economic sanctions, and by regional authorities overseeing the industrial development of their respective regions.

US economic sanctions targeting Latin America: Recent changes, developments and compliance challenges

The United States — specifically through the US Department of the Treasury's Office of Foreign Assets Control (OFAC) and the Department of State — has maintained economic sanctions against certain Latin American countries since the 1950s. Starting with broad-based sanctions against Cuba, where OFAC prohibited virtually all transactions, the Department of the Treasury has instituted more-targeted sanctions regimes against Venezuela and Nicaragua, where non-government dealings are, for the most part, authorised. Together, the Departments of State and the Treasury also administer sanctions against various narcotics and terrorist organisations operating in Latin America. Most notable is the Foreign Narcotics Kingpin Designation Act, which has targeted trafficking organisations, foreign officials and their money laundering empires. To that end, sanctions, while initially imposed to fight certain political regimes, have developed into sanctions targeting all kinds of wrongdoing such as sponsoring terrorism, aiding and abetting drug trafficking, corruption and the commission of human rights violations. US sanctions violations are assessed under a strict liability standard (ie, no knowledge of the violation is required to trigger liability) and impact not only those directly subject to the jurisdiction of the US but also may carry implications for non-US persons undertaking certain ‘significant transactions' with sanctioned persons and jurisdictions. Further, while sanctions apply to US persons, OFAC can institute penalties on non-US persons for causing a US person to violate their compliance obligations. In addition, OFAC (or the Department of State) may sanction persons (individuals or entities) by adding them to the Specially Designated and Blocked Nationals (SDN) List. US persons must block the property and interests in property of SDNs, and are prohibited from virtually all, direct and indirect, transactions involving an SDN. SDN restrictions also apply to ‘Shadow SDNs' which are entities owned 50 per cent or more, directly or indirectly, by one or more SDNs in the aggregate. A Shadow SDN receives the same treatment as SDNs, regardless of whether such entity is itself on the SDN List. The challenge with Shadow SDNs is that they can only be discovered through rigorous due diligence into beneficial ownership structures of sometimes opaque corporate entities. This is where the world of sanctions compliance and enforcement crosses with that of anti-money laundering. The evolving customer due diligence, ongoing customer monitoring, suspicious activity investigations and reporting, and know your customer (KYC) (and know your customer's customer [KYCC]) evidenced are reflected through the evolving Financial Action Task Force (FATF) Recommendations, the Financial Action Task Force on Money Laundering in South America (GAFISUD) and domestic regulations. As a result of the increasingly unpredictable political changes in Latin America, and the concurrent changes in sanctions regimes, financial institutions (FIs) should maintain a proper understanding of the current sanctions prohibitions, the trends and updates in the area, but equally important, they should also maintain a good understanding of the complex legal provisions authorising certain behaviours — including the general licences and exemptions — that may apply. FIs must balance mitigating the risks of sanctions violations, and the associated hefty penalties, with the risks of a cumbersome and overly restrictive compliance regimen. An appropriately risk-based compliance programme that achieves both of these objectives is very much an art and not a ‘one size fits all’ model.

Trade Sanctions against Russia and their WTO Consistency: Focusing on Justification under National Security Exceptions

Abstract In the wake of Russia’s 2022 invasion of Ukraine, around 40 countries/economies, including G7 members, responded to impose a wide range of economic, including trade-related, sanctions on Russia. The question immediately arises as to whether such sanctions violate the WTO agreements or are justified under the relevant national security exceptions. After introducing the material facts of the economic sanctions against Russia as well as the development of WTO jurisprudence on national security exceptions – particularly Article XXI(b)(iii) of the GATT –, this article goes on to analyse the WTO consistency of these trade sanctions against Russia, on a country-by-country and a measure-by-measure basis. From the standpoint of the “war or other emergency in international relations” and “its essential security interests” requirements, countries are categorised according to their geographic proximity and relationship (e.g., military alliances, customs unions, etc) to the belligerents, while measures are categorised by their nature and aim from the standpoint of the “necessary to protect” requirement.

WTO Dispute Settlement and Trade Sanctions as Permissible Third-Party Countermeasures under Customary International Law

Abstract The requirements for invoking WTO security exceptions as expounded in recent WTO dispute settlement cases are notably stricter than previously thought by WTO members. Consequently, not all WTO members who have imposed trade sanctions against Russia will be able to invoke these exceptions to justify their actions when accused by Russia of violations of their WTO obligations. This article considers whether WTO members who may be unsuccessful in invoking security exceptions may nonetheless be able to justify their measures within the context of WTO dispute settlement under the customary international law on third-party countermeasures. It does so by exploring the scope of the relevant provisions within the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU) as well as competence of WTO adjudicative bodies (i.e., WTO panels and the Appellate Body) to look beyond the four corners of the WTO covered agreements.

Freezing, Confiscation and Management of the Assets of the Russian Central Bank and the Oligarchs

Abstract As the most powerful measure of economic sanctions against Russia which invaded Ukraine, the Western States froze the assets of the Russian Central Bank and the Oligarchs which are situated in their States. This article attempts to clarify the legality of the freezing, confiscation, and management of assets under international law. The freezing of assets is a legal countermeasure against aggression. Confiscation is lawful only if certain conditions are satisfied. Management is a realistic option which avoids the legal risks which might arise from confiscation.

PECULIARITIES OF THE APPLICATION OF FINANCIAL DIPLOMACY SANCTION TOOLS BY STATES

The article is devoted to a comprehensive study of the modern practice by states of the sanctions toolkit of financial diplomacy and an assessment of its political and economic effectiveness. The role of economic sanctions in the system of financial instruments of diplomatic activity of states and their achievement of strategic goals related to accelerating macroeconomic growth and improving the material well-being of the population are defined. Considerable attention is paid to identifying the functional purpose of economic sanctions and revealing their place in the modern regulatory toolkit of international organizations, regional integration groups, and national governments. It has been proven that economic sanctions have been actively implemented in recent decades as one of the means of political pressure on those states that violate the system of international order and threaten the national interests of a significant number of sovereign states. Economic sanctions are also qualified as an important mechanism for states to achieve a number of political and economic goals, de-escalation of global and regional conflicts, as well as deterring countries from aggressive behavior in the international arena. It was found that recent years have been characterized by a significant increase in the attention of researchers to the issue of increasing the effectiveness of the sanctions tools of financial diplomacy used by states.

Assessing Economic Resilience in NATO Countries: A Comprehensive Defence Perspective

Economic resilience, considered in this paper as the ability to withstand and recover from economic shocks and disruptions, has become a linchpin of ensuring national security and stability. As demonstrated by conflicts such as the one in Ukraine, where economic sanctions were deployed to diminish an adversary’s capacity to sustain its war efforts, it has become evident that military power alone is insufficient in today’s complex security landscape. A comprehensive approach to defence must incorporate economic considerations, as the economic well-being of a nation is intrinsically linked to its overall security. The main research objectives of this paper are to investigate the concept of economic resilience, from the perspective of the concept of comprehensive defence and the ways it is interconnected with other resilience domains, through the development of an economic resilience index outlining the relative economic resilience of the 29 European countries that are NATO members and to propose a methodology for identifying the main factors that influence the economic resilience from a comprehensive defence point of view.