US Sanctions Research Articles

Sanctioned to Death? The Impact of Economic Sanctions on Life Expectancy and its Gender Gap

We empirically analyse the effect of UN and US economic sanctions on life expectancy and its gender gap in target countries. Our sample covers 98 less developed and newly industrialised countries over the period 1977–2012. We employ a matching approach to account for the endogeneity of sanctions. Our results indicate that an average episode of UN sanctions reduces life expectancy by about 1.2–1.4 years. The corresponding decrease of 0.4–0.5 years under US sanctions is significantly smaller. In addition, we find evidence that women are affected more severely by the imposition of sanctions. Sanctions not being ‘gender-blind’ indicates that they disproportionately affect (the life expectancy of) the more vulnerable members of society. We also detect effect heterogeneity, as the reduction in life expectancy accumulates over time and countries with a better political environment are less severely affected by economic sanctions. Finally, we provide some evidence that an increase in child mortality and Cholera deaths as well as a decrease in public spending on health care are transmission channels through which UN sanctions adversely affect life expectancy in the targeted countries.

Theorising resilience: Russia’s reaction to US and EU sanctions

ABSTRACT This article analyses responses in the Russian media to the economic sanctions imposed in the wake of the annexation of Crimea. We look at the near-Kremlin figure Dmitry Kiselyov, explaining how elite actors employ persuasive tools in order to fashion and promote collective resilience not only as a value, but also as part of a quest for a post-Soviet identity. We show how resilience in the face of economic hardship is built and sustained, ensuring the continuity of the incumbent government. We further theorise on the underpinnings of constructing resilience, which ultimately strengthens national identity in the post-Soviet ideological vacuum.

Financial sanctions and political risk in the international currency system

Scholarship on international currencies has traditionally emphasised how an issuing state’s foreign policy can enhance the attractiveness of its currency for cross-border use. Yet, foreign policy actions need not only boost a currency’s international appeal—they may also undermine it. This study introduces a general theory of how US foreign policy can influence governments’ policy orientations toward the dollar in positive or negative ways. Policies like financial sanctions generate ‘political risk’ that weaken the dollar’s attractiveness for international use. The study tests the claim that the United States’ use of financial sanctions incentivises targeted governments to implement de-dollarization policies. I employ a most-likely case study design, presenting evidence from three countries targeted by US sanctions: Russia, Venezuela and Turkey. In each instance, the evidence shows that financial sanctions created political risk concerns by generating expectations of future direct costs of dollar use. These expectations set off policy efforts by targeted governments to reduce their economies’ exposure to the currency. This study raises important questions about the long-term efficacy of an approach to foreign policy that relies on financial sanctions as a primary means of leverage over foreign adversaries as overuse may undermine the effectiveness of the tool itself.

THE SPILLOVER EFFECTS OF THE RE-IMPOSED UNITED STATES SANCTIONS ON IRAN ON MENA, THE PRC, RUSSIA, AND TURKEY

Iran has faced US sanctions in one form or another since its invasion of the US Embassy in Iran in 1979. The 2007-08 period marked the initiation of heightened international sanctions on Iran imposed by the UN Security Council in reaction to Iran’s nuclear program. These sanctions were tightened in 2010, when the UN Security Council, the US Congress, and the European Union all implemented separate sets of sanctions targeting either the Iranian nuclear program or the energy and banking sectors. Under the Obama Administration the Joint Plan of Action (JPOA) was signed in late 2013 and within months the United States and the EU took steps to waive specific sanctions. In 2015 the Joint Comprehensive Plan of Action (JCPOA) was signed, which lifted nuclear-related sanctions by the UN, EU and US. The Trump Administration on May 8, 2018 announced the US withdrawal from the JCPOA and directed federal agencies to begin to take steps to re-impose the sanctions established under U.S. law that were lifted or waived in order for the United States to meet its commitments in the JCPOA. On November 5, 2018, all pre-JCPOA - U.S. sanctions on foreign firms that conduct transactions in all of Iran’s core economic sectors, including energy, banking, shipping, and manufacturing, went back into effect. These include sanctions on “petroleum-related transactions” and transactions by foreign banks with Iran’s Central Bank. In addition,700 Iranian and third country entities have again been designated by the United States as sanctioned entities, meaning that foreign firms that transact business with these entities could face virtual exclusion from the U.S. economy. With the re-imposition of sanctions on Iran, in 2018, the US finds itself as a lone player in a world where the EU, the PRC, Russia and a group of MENA countries have no intentions to comply with these re-imposed sanctions. The purpose of this paper, consequently, is to assess the spillover effects which can be expected to result from the US re-imposition of Iran sanctions on relevant MENA countries, the PRC, Russia and Turkey.

Announcements of Sanctions and the Russian Equity Market: An Event Study Approach

The research question raised in this paper is an investigation of the effect of the announcement of US and EU sanctions on the stock returns of the targeted companies listed on the Moscow Exchange. The strategy for identification is based on firm-specific and multivariate short-term event studies. Firm-specific event study of eight sanctions that targeted 14 entities at different times results in a statistically significant ?5.4% estimate of the expected cumulative abnormal return within a window of seven trading days.

Going Fishing versus Hunting Whales: Explaining Changes in How the US Enforces Economic Sanctions

How economic sanctions are enforced undoubtedly affects their chances of success. Yet, to date, a lot remains unknown about how governments actually enforce their sanctions. To shed light on the ways governments enforce their sanctions, we conduct an empirically driven case study of how the lead agency for enforcing economic sanctions in the United States, the Treasury Department’s Office of Foreign Assets Control (OFAC), has enforced US sanctions from 2003 to 2018. Our study begins with an empirical exploration of how OFAC’s enforcement actions originate, what factors correlate with enforcement actions being taken, and what factors contribute to the financial penalties imposed as part of enforcement actions. We find that OFAC engaged in two distinct enforcement strategies during our period of analysis: a “fishing” strategy that involved taking a lot of enforcement actions and imposing small fines during the administration of George W. Bush and a “whale-hunting” strategy that involved pursuing fewer cases but imposing enormous fines during Barack Obama’s administration. Our analysis indicates that the shift in foreign policy emphasis from Cuba to Iran during the Bush administration and how that motivated new legislation to enhance penalties for violating sanctions paved the way for the OFAC to adopt its innovative whale-hunting strategy during the Obama administration. Our study also yields a wealth of new empirical insights into how the United States enforces its sanctions that can contribute to future theory-building efforts.

Sanctioned to Death? The Impact of Economic Sanctions on Life Expectancy and Its Gender Gap

We empirically analyze the effect of UN and US economic sanctions on life expectancy and its gender gap in target countries. Our sample covers 98 less developed and newly industrialized countries over the period 1977–2012. We employ a matching approach to account for the endogeneity of sanctions. Our results indicate that an average episode of UN sanctions reduces life expectancy by about 1.2–1.4 years. The corresponding decrease of 0.4–0.5 years under US sanctions is significantly smaller. In addition, we find evidence that women are affected more severely by the imposition of sanctions. Sanctions not being gender-blind indicates that they disproportionately affect (the life expectancy of) the more vulnerable members of society. We also detect effect heterogeneity, as the reduction in life expectancy accumulates over time and countries with a better political environment are less severely affected by economic sanctions. Finally, we provide some evidence that an increase in child mortality and Cholera deaths as well as a decrease in public spending on health care are transmission channels through which UN sanctions adversely affect life expectancy in the targeted countries.

Oil project selection in Iran: A hybrid MADM approach in an uncertain environment

This research focusses on the selection of oil projects by using Multi-Attribute Decision Making (MADM) methods in an uncertain environment. Oil production plays a crucial role in the economy of Iran, a country with many opportunities for onshore oil exploration. Differently from other countries, however, oil producers in Iran face some constraints with respect to oil extraction because some areas are shared with other producers. Additionally, oil producers in Iran must also allocate scarce physical, human, and monetary resources among different projects. Inaccurate decision-making may not only yield sub-optimal revenue generation, but also adversely affect the national economy For these reasons, priority oil projects must observe a sequence of steps. In the first step, critical factors for selecting oil projects are collected from previous related studies and experts are interviewed. These factors are subsequently filtered using the Delphi method. The oil projects are then ranked using a comprehensive approach involving novel alternative MADM methods. The best-worst method (BWM) is a new MADM stream that relies on pairwise comparison. It presents several distinct advantages with respect to fewer computational steps and higher discriminatory power among alternatives. Differently from previous research, this paper couples BWM with Weighted Aggregated Sum–Product Assessment (WASPAS) to improve result sensitivity under uncertain decision-making environments as modelled by Z-numbers. A robustness cross-check against other MADM models is also presented. Results indicate that quality has the highest priority and that production technology has the lowest priority among ten factors for oil project selection, thus reflecting the impact of US sanctions on oil production in Iran. Managerial implications and future avenues of research are derived.

The Iran Problem: An Evaluation of US Sanctions on Iran and Global Reactions

The Iran Problem: An Evaluation of US Sanctions on Iran and Global Reactions

Lettres d'Iran. Images architecturales et urbaines au défi du COVID-19

Architectural and urban pictures to challenge Covid-19 – The arrival of the Coronavirus in Iran confronts a highly centralized state, weakened by US sanctions, and an imaginative civil society to react and take initiatives. The transformations of traditional Iranian habitat are also not favorable for protection against contagion. Conversely, the crisis is accelerating changes in urban mobility (bicycle-sharing system) and transitions to the digital society.

НОВАЦИИ В ЭКОНОМИКЕ КНДР В ЭПОХУ КИМ ЧЕН ЫНА: ИТОГИ, УГРОЗЫ И РИСКИ

During the 8 years of the DPRK leadership, Kim Jong-un has been trying to position himself as a major reformer of the economy and the main military strategist in the development of the production of the latest intercontinental missiles directed towards the United States. Kim Jong-un presented the economic program for the first time at the VII Congress of the Labor Party of Korea in 2016 in the format of the three main tasks of the first five-year plan for 2016-2020. Tasks. To summarize Kim Jong-un's innovations in economic development and prove that they will be effective in the context of expanding trade and economic cooperation between the DPRK and China, Russia, as well as reducing the US sanctions policy against the DPRK. Methodology. The use of methods of scientific knowledge of the reformation of the economy of less developed countries. Results. The scale of economic innovations of Kim Jong-un and the influence of the legacy left by Kim Il-sung and Kim Jong-il from the position of national ideology are proved to be self-reliant (Juche), which complicates and slows down the transition of North Korea to the number of democratically developed countries of the world, political and trade-economic DPRK cooperation with the Republic of Korea. Findings. Today, China has always been and remains the main military-political ally and economic partner of the DPRK. Sino-US relations have become much more complicated as a result of the trade war and US accusations of concealing by China the real reasons for the appearance and spread of COVID-19 all over the world. The DPRK's economic relations with the United States do not develop after direct contact in 2019 of Donald Trump with Kim Jong-un. External and internal threats and risks in the use of innovations remain.

Trade Sanctions: A Minor Hindrance or Complete Disaster

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.

RUSSIA’S NEW SOFT POWER: THE MIR CARD SYSTEM

After the onset of Western sanctions in 2014, the Russian National Card Payment System (NSPK) and its corresponding Mir bank cards launched the following year. Five years later, estimates show that 56 million people are using Mir cards, more than 20 percent of Russia’s bank card market and will be operational in twelve foreign countries. Traditionally, scholars have examined Russian soft power as aiming to integrate post-Soviet countries with Russia and Central Asian countries through promoting beneficial economic and cultural relationships. With the Mir card system, Russia is seeking primarily to become less dependent on a dollar-dominated financial system, as well as to avoid potentially increasing US sanctions and to overarchingly seek to build a multipolar system. This research will investigate the Mir card system.

ПРОЕКТНОЕ УПРАВЛЕНИЕ КАК ИНСТРУМЕНТ СТРАТЕГИЧЕСКОГО РАЗВИТИЯ РОССИЙСКОЙ ФЕДЕРАЦИИ

The world economic crisis of 2009, subsequent events of economic stagnation and overcoming the crisis of European countries, America and Russia showed that even stably carrying out scientific, technical and economic progressive development of the country fall into a wave crisis process. This process is primarily associated with production and consumption. In Russia, it was aggravated by a deep severance of economic ties, for example, due to a power crisis in Ukraine, as well as the adoption of US and EU sanctions. The result of the economic crisis is an increase in poverty in Russia. The article describes the current problems and tools for the implementation of documents adopted by the president and the government of the program-project strategic development of the state for the period up to 2024, which should ensure the socio-economic development of the population and the country, and are also included in the top 5 economies of the world.

US Sanctions on Iran and Its Impact on Iraq

The research is interested in shedding light on the historical framework of US-Iranian relations since 1979, and the political events that have permeated it, which later reflected the imposition of a number of US sanctions on Iran, which directly affected the formulation of its foreign policy towards Arab and international countries. The problem of research revolves around the recent US sanctions against Iran in 2018, and as many historians and economists put it, "it is the most severe" as it includes oil exports, shipping, and banks, while targeting any company or organization that circumvents the implementation of the sanctions. As far as the matter is concerned with Iraq, the research is interested in stating the extent of its influence on the sanctions imposed on Iran, in economic terms, the volume of trade exchange, and the Iraqi market. The research was divided into an introduction and three axes, the first concerned with giving the historical framework for US-Iranian relations after 1979. The second topic focused on highlighting the sanctions imposed on Iran since 1979. As for the last topic, it indicated the repercussions of the sanctions on the Iraqi economy.

US FOREIGN POLICY IN RESTORING DIPLOMATIC RELATIONS WITH CUBA IN 2015-2016

At the end of 2014, the United States, under the leadership of President Barack Obama, decided to improve relations with Cuba. The relationship between the two countries has a long history. After 53 years of severing diplomatic ties with Cuba, America finally made a change through the policy of diplomatic relations improvement that began in 2015. This study analyzes the background that encourages the restoration of political ties between the United States and Cuba, examining the implementation of foreign policy forms between the two countries As a result of the restoration of diplomatic relations between the United States and Cuba through diplomatic channels. This research uses foreign policy theory and the theory of international pathways. The research method used is qualitative research with a secondary data source, with a data collection technique through a literature study. The study found that in the policy of restoring the diplomatic relations between the United States and Cuba happened for three main reasons, the first one. President Obama realized that US sanctions to Cuba is a policy that is not successful; the United States no longer wants to lose the market, which was very promising in Cuba. And also, the United States has a ton amount of pressure internationally and domestically, asking them to recover their relations with Cuba. These reasons ultimately implemented through diplomatic channels by both countries. They have implications such as increased bilateral visits, increased investment, and business as well as cultural exchange through communities and students.

U.S. Sanctions and the Russian Arctic: The Oil and Gas Sector as Russia’s Achilles’ heel?

The territorial dispute between Russia and Ukraine, which has been going on since the illegal annexation of Crimea by Russia in 2014, is now starting to show effects also far away from the battlefields of Eastern Ukraine: in the waters of the Arctic Ocean, off the shores of Russia’s far north. US sanctions against Russia have recently had a direct impact on the ability of the hydrocarbon sector to operate as planned. In this text, it will be shown that the very sector on which the current Russian government seems to pin a lot of hope for the country’s economic development, the oil and gas sector, might turn out to become Russia’s weakness in the future. In this investigation, US sanctions against Russia are put into the wider context of their effects on non-US actors, in particular companies from the Arctic and Nordic countries, as well as into the wider context of international law. It will be shown that, although the Russian oil and gas industry is perceived as a key element of the Russian economy today, the dependence on non-Russian technology, combined with the effective implementation of US sanctions against Russia, might turn out to be an effective lever for change in Moscow.

Building an effective US-UK sanctions compliance programme: What are the key components?

Economic and trade sanctions are political tools used to further government objectives, typically to seek to change or modify the behaviour of the target country’s regimes, or particular individuals or groups, based on foreign policy and national security goals. In recent years, we have observed a dramatic increase in the use of sanctions by the European Union (EU) (and by extension the United Kingdom) as well as the United States, indicating a foreign policy shift that continues to create challenges for businesses subject to EU, UK and US sanctions regimes. In the United Kingdom, the Financial Conduct Authority (FCA) expects regulated entities to tailor their systems and controls to mitigate the risk of financial sanctions violations. In the United States, the Office of Foreign Assets Control (OFAC) encourages a risk-based approach to sanctions compliance. There is no one-size-fits-all approach. Nevertheless, on the basis of a review of the applicable legislation, regulations, guidance from the authorities, policy statements, and observations from recent enforcement actions as well as our own advisory work in this area, there are certain key components that every sanctions compliance programme should contain. This paper will briefly set out why having an effective sanctions compliance programme is necessary. We will then discuss expectations by regulators and enforcement authorities as to what constitutes an effective sanctions compliance programme, and, finally, explore how companies can seek to meet and manage these expectations from a cross-border perspective.

Macroeconomic Implications of US Sanctions on Iran: A Sectoral Financial Balances Analysis

Abstract Iran is facing a severe macroeconomics crisis after the US (re)imposed sanctions on its oil and gas exports in May 2018, followed by additional sanctions on metal exports in 2019. Its exports have collapsed triggering a contraction of the economy along with accelerating inflation and depreciating currency. Using the sectoral financial balances (SFB) model, we study the interrelationship between several macroeconomic parameters maintaining stock-flow consistency across time and sectors of the economy. Fiscal and monetary policy cannot reverse the consequences of the sanctions although fiscal deficits as a percentage of GDP will see a rise to accommodate the domestic private sector’s desire to accumulate financial asset accumulation. The lack of a strong monetary policy mechanism in Iran may, however, be unable to quell the impact of expansionary fiscal policy on inflation and depreciating rial. Given the limited macroeconomic policy options open to Iran in dealing with the crisis Iran, the only option may be political – a return to the negotiating table with the US.

Turkey’s Unravelling Economy Resembles the Ottoman Empire’s Financial Collapse

Already fragile Turkish-American foreign relations became severely strained when US Pastor Andrew Brunson was indicted on espionage charges in October 2016 and was sentenced to 38 months in prison after a guilty verdict by one of Turkey’s high criminal courts. As a US retaliation, bank executive Mehmet Hakan Atilla (Turkey's state-controlled Halkbank) was arrested in New York in March 2017 and sentenced to 32 months after he was found guilty of helping Iran to evade the US sanctions. These along with the domestic issues fostered a currency crisis in August 2018 (most severe since the 2001 economic crisis), the farfetched implications of the currency and debt crisis caused the economy of Turkey to debilitate and find itself in a severe financial emergency. Since the August rout, the Turkish economy has been on a wild roller-coaster ride. First, all economic indicators recorded their worst levels in more than a decade (since 2003); interest rates in October 2018 skyrocketed, 36% for commercial loans, 28% for housing loans, and as high as 24% for deposits in lira. Second, after central bank (TCMB) has cut 750 basis points in its key policy rate (reduced from 24% to 16.50%), interest rates for commercial loans dropped to below 20%, 16% for housing loans, and as low as 14% for deposits in lira. The events that contributed to the Ottoman Empire’s collapse are strikingly similar to the financial collapse of the Turkish economy at the end of 2018. The Ottoman’s financial problems began with its engagement in the costly Crimean War (1853-56); likewise, Turkey’s gloomy economic situation was contributed by its war affairs alongside the Iraq and Syria borders as well as its costly military operations to eradicate terrorists at home and near borders. The Ottoman borrowing spree in mid-19th century onward turned into an elongated addiction to foreign capital which resulted in Ottoman’s default on its public debt in 1876, and in 1878 at the Congress of Berlin, France and Britain took control of the Ottoman finances by forcing sultan Abdulhamid II to create the Ottoman Public Debt Administration (OPDA) in 1881. Similarly, the increased military spending even though Turkey did not take part in WWII and repeated economic disruptions in the post-WWII era often resulted in balance of payments crises as well as consequent devaluations of the Turkish lira; political turmoil coupled with economic difficulties prompted the military to intervene (coup) in 1960 and this paved the road to Turkey’s first standby agreement with the IMF in 1961.