Cayman Islands, Caribbeanand International News
Wednesday, Jul 24, 2024

Sanctions are neither new nor guaranteed to work – just look at Cuba

Sanctions are neither new nor guaranteed to work – just look at Cuba

Analysis: Economic penalties have been meted out since Napoleon’s day but there’s little proof they achieve the desired outcome

Waging war by economic means is nothing new. Napoleon imposed an ineffective embargo on British exports in the early 19th century and during the first world war there were attempts by both sides to starve each other into submission.

But since 1945 sanctions have been used with increasing frequency as a means of trying to change either the policy stance or the regimes in targeted countries.

One study by a group of German academics notes there have been more than 1,400 cases of nations being threatened with, or hit by, sanctions since the second world war.

Perhaps unsurprisingly, the report by the Ifo thinktank found that the sanctions were more likely to be successful the harder the targeted economy was hit.

On average, living standards fall by 4% in the first two years of the restrictive measures being implemented, but that masks a wide range of different outcomes.

Adam Slater, economist at the Oxford Economics consultancy says the sanctions imposed on Russia between 2014 and 2018 cut GDP by around 1.2% but thinks a “larger impact looks likely this time” as a result of a toughening up of the west’s approach. “We think a 4-6% of GDP hit relative to a pre-crisis baseline is a plausible downside scenario.”

But hitting a country economically is a different matter from forcing it into a policy U-turn or bringing about a change of government. Jeremy Greenstock, once the UK’s ambassador to the UN, says “there is nothing else between words and military action if you want pressure to bear on a government.” But in the high-profile cases there is only limited evidence to show they have worked.

An old American car is driven in 2022 as a wave pounds the Malecón in Havana, Cuba.

Take the case of Cuba, which has been under US sanctions since the late 1950s. Washington strongly opposed the takeover of power by Fidel Castro’s communist regime and ever since has restricted the flow of goods to the island.

The UN and the Cuban government estimate the total cost to the economy has been $130bn (£97bn) over six decades but as the Harvard academic Christopher Rhodes notes all the sanctions have done is to provide the regime with a convenient scapegoat for the country’s woes.

If anything, the impact of wide-ranging sanctions against Venezuela have been even more damaging than in Cuba. The economy grew for the first time in seven years in 2021 following a period that saw output fall by 75% and the currency collapse. There was intense economic suffering and mass migration, but again no regime change.

Iran has faced US sanctions for more than 40 years, ever since the seizure of the American embassy in Tehran by radical students in 1979.

More recently, there have been UN-backed steps to prevent banned nuclear activities, with a marked tightening of the sanctions regime announced by Donald Trump in 2018.

A brief easing of the sanctions led to a spurt in the economy in 2016 but the growth record has been dismal since. Even so, Iran shows no immediate sign of buckling, insisting the sanctions be dropped before talks on its nuclear programme start.

Sanctions have failed to force a policy change in Iran.

North Korea is one of the world’s poorest countries, with income per head less than one-tenth of neighbouring South Korea.

The UN has passed resolution after resolution demanding North Korea halt its nuclear weapon programme, punishing sanctions have been imposed restricting trade and targeting individuals linked to the military. There has not been the slightest sign of North Korea demilitarising.

Nor, despite causing intense economic and humanitarian distress has the weapon being deployed against Russia – seizing the country’s reserves held overseas – so far worked in Afghanistan.

Lord Meghnad Desai, says: “American hegemony of financial machinery is total. The US controls the International Monetary Fund. It can seize the foreign exchange reserves of Afghanistan and cause a famine to punish the Taliban for having humiliated the US. Will it now succeed in strangling Putin?”

South Africa is an example of where sanctions were more effective and provides some hope for those who think the west can win its battle against Putin by non-military means. Nelson Mandela said there was “no doubt” trade embargoes of the 1980s hastened the demise of apartheid.

Two things differentiated South Africa from Cuba, Iran, Venezuela and North Korea. Firstly, by the late 1980s the apartheid regime was internationally friendless, with even countries such as the UK and the US passing laws restricting trade.

Secondly, its economic isolation was reinforced by a sporting and cultural boycott that made it clear to South Africans they were living in a pariah state.

“Even harsh sanctions may fail to impress Putin. Iran and North Korea have shown that brutal dictatorships can persevere for a long time despite very heavy sanctions”, says Holger Schmieding of Berenberg bank.

“But many Russians have close links to the free world and strong family ties to Ukraine. The news about the reason for the sanctions, Putin’s brutal invasion of Ukraine, will likely spread even in Russia, especially as its military seems to incur significant casualties that will be difficult to hide.”

In the past, Russia has helped soften the sanctions imposed on other countries. Whether Putin can withstand the economic measures now being aimed at him will depend on how many reliable friends he can still muster and – just as importantly – whether the elite stays loyal.


Related Articles

Paper straws found to contain long-lasting and potentially toxic chemicals - study
FTX's Bankman-Fried headed for jail after judge revokes bail
Blackrock gets half a trillion dollar deal to rebuild Ukraine
Israel: Unprecedented Civil Disobedience Looms as IDF Reservists Protest Judiciary Reform
America's First New Nuclear Reactor in Nearly Seven Years Begins Operations
Southeast Asia moves closer to economic unity with new regional payments system
Today Hunter Biden’s best friend and business associate, Devon Archer, testified that Joe Biden met in Georgetown with Russian Moscow Mayor's Wife Yelena Baturina who later paid Hunter Biden $3.5 million in so called “consulting fees”
Singapore Carries Out First Execution of a Woman in Two Decades Amid Capital Punishment Debate
Google testing journalism AI. We are doing it already 2 years, and without Google biased propoganda and manipulated censorship
Unlike illegal imigrants coming by boats - US Citizens Will Need Visa To Travel To Europe in 2024
Musk announces Twitter name and logo change to X.com
The politician and the journalist lost control and started fighting on live broadcast.
The future of sports
Unveiling the Black Hole: The Mysterious Fate of EU's Aid to Ukraine
Farewell to a Music Titan: Tony Bennett, Renowned Jazz and Pop Vocalist, Passes Away at 96
Alarming Behavior Among Florida's Sharks Raises Concerns Over Possible Cocaine Exposure
Transgender Exclusion in Miss Italy Stirs Controversy Amidst Changing Global Beauty Pageant Landscape
Joe Biden admitted, in his own words, that he delivered what he promised in exchange for the $10 million bribe he received from the Ukraine Oil Company.
TikTok Takes On Spotify And Apple, Launches Own Music Service
Global Trend: Using Anti-Fake News Laws as Censorship Tools - A Deep Dive into Tunisia's Scenario
Arresting Putin During South African Visit Would Equate to War Declaration, Asserts President Ramaphosa
Hacktivist Collective Anonymous Launches 'Project Disclosure' to Unearth Information on UFOs and ETIs
Typo sends millions of US military emails to Russian ally Mali
Server Arrested For Theft After Refusing To Pay A Table's $100 Restaurant Bill When They Dined & Dashed
The Changing Face of Europe: How Mass Migration is Reshaping the Political Landscape
China Urges EU to Clarify Strategic Partnership Amid Trade Tensions
Europe is boiling: Extreme Weather Conditions Prevail Across the Continent
The Last Pour: Anchor Brewing, America's Pioneer Craft Brewer, Closes After 127 Years
Democracy not: EU's Digital Commissioner Considers Shutting Down Social Media Platforms Amid Social Unrest
Sarah Silverman and Renowned Authors Lodge Copyright Infringement Case Against OpenAI and Meta
Italian Court's Controversial Ruling on Sexual Harassment Ignites Uproar
Why Do Tech Executives Support Kennedy Jr.?
The New York Times Announces Closure of its Sports Section in Favor of The Athletic
BBC Anchor Huw Edwards Hospitalized Amid Child Sex Abuse Allegations, Family Confirms
Florida Attorney General requests Meta CEO's testimony on company's platforms' alleged facilitation of illicit activities
The Distorted Mirror of actual approval ratings: Examining the True Threat to Democracy Beyond the Persona of Putin
40,000 child slaves in Congo are forced to work in cobalt mines so we can drive electric cars.
BBC Personalities Rebuke Accusations Amidst Scandal Involving Teen Exploitation
A Swift Disappointment: Why Is Taylor Swift Bypassing Canada on Her Global Tour?
Historic Moment: Edgars Rinkevics, EU's First Openly Gay Head of State, Takes Office as Latvia's President
Bye bye democracy, human rights, freedom: French Cops Can Now Secretly Activate Phone Cameras, Microphones And GPS To Spy On Citizens
The Poor Man With Money, Mark Zuckerberg, Unveils Twitter Replica with Heavy-Handed Censorship: A New Low in Innovation?
Unilever Plummets in a $2.5 Billion Free Fall, to begin with: A Reckoning for Misuse of Corporate Power Against National Interest
Beyond the Blame Game: The Need for Nuanced Perspectives on America's Complex Reality
Twitter Targets Meta: A Tangle of Trade Secrets and Copycat Culture
The Double-Edged Sword of AI: AI is linked to layoffs in industry that created it
US Sanctions on China's Chip Industry Backfire, Prompting Self-Inflicted Blowback
Meta Copy Twitter with New App, Threads
The New French Revolution
BlackRock Bitcoin ETF Application Refiled, Naming Coinbase as ‘Surveillance-Sharing’ Partner