We witnessed a handful of historical milestones in international politics these days. For example, the Burmese recently installed a new government chosen through election; the Iranians have agreed to be more open about their nuclear project earlier this year, and many other examples of the success of diplomacy. Those events share one similarity that is going to be the highlight of this writing: the involvement of economic sanctions.
Economic sanction is one of many diplomatic tools used to influence the stance of sanctioned countries regarding certain issues. It’s usually in the form of trade limitations or embargoes (no more imports and exports from and to target countries), aid and loans reduction or even waiver.[1] Do note that economic sanctions are done to achieve diplomatic goals instead of commercial ones, thus it is different with restrictive trade and financial regulations certain countries enacted.[2] Countries imposed economic sanctions so that target countries would agree to a certain international treaty, for instance. Economic sanctions are done also to express political stance in response to a certain international issues.
The implementation of economic sanctions, just like most diplomatic tools, has always been contentious. The disagreement revolves around a few points. For example, the fact that economic sanctions often miss the intended target, that instead of impairing sanctioned country’s leaders’ economic power, it harms the people. This is because during severe economic conditions, rogue leaders will cut resources given to the people even worse than before or even become more repressive towards dissenting opinions coming from their own citizens. Even after the rise of smart sanctions, more targeted measures toward high-ranking officials such as assets freezing, travel bans, and arms embargoes, problems and disagreements still occur.
Taking an example of the Libyan uprising, freezing the assets of Muammar Qaddafi was quite difficult seeing how his assets were often not put under numerous misspelling of his name, thus his accounts remained undetected by bank software.[3] To make things worse, state fund was mixed with personal possessions and thus blunt freezing of such accounts could not be done.[4] However you slice it, bringing a dictator hiding behind their people to justice is never a simple matter.
The quest on making an economic sanction effective should begin from identifying major faults in their economy and who is going to suffer the major brunt. However, as most actively-oppressed dictators are those that cannot provide sufficient public services, it is likely that they don’t have enough resources or are keeping them to themselves. Therefore, it is not strategic to cut down on aid or restrict import and export as it would harm innocent parties. These dictators would still thrive on their previous riches and be barely affected by the restriction. It is their people that would suffer because of the even more limited resources. Thus, one of the safest and the most accurate ways is to conduct arms embargoes instead. It will directly decapitate dictators’ main source of power and authority: weapons.
Secondly, should the international community decided to freeze assets of high-ranking officials from sanctioned countries, it is very important to thoroughly track their international transaction to best keep record of their overseas assets. If somehow it is still difficult to find comprehensive information about their assets, then they could resort into sanctioning central banks of target countries. Oftentimes, financial institutions have sizeable assets overseas and freezing them could serve as a leverage to persuade sanctioned countries in changing their behavior. This is first implied to get the Iranian complying to the Nuclear Deal, and as of January this year, sanctions are loosened for the Iranians have dismantled and allowed the IAEA to inspect their nuclear facilities.[5]
The last but definitely not the least issue that needs to be addressed is preventing circumvention of economic sanctions. It is common in international politics that countries form blocs of allies, a group of countries sharing similar stance or a political agenda to support each other. Therefore, it is common that an international action is not collectively executed. Hence, not everyone will sanction target countries. Especially in terms of trade embargoes, similar effect akin to cartel formation will occur. Since a country might be allies with target countries and seeing that there is no other seller or buyer in target country’s market, it would be very lucrative not to stand together with the rest of the world. For instance, in 2010 China was the largest trading partner of Iran after UN sanctions was put in effect.[6] In such cases, perhaps not only singular countries should be targeted, but loyal allies should be persuaded first to ensure that they will not help target country. It might be very difficult to sanction powerful allies, yet they are the main obstacle that needs to be handled to ensure the success of any form of sanctions. Moreover, countries are not the only actors that would cheat in this case. Often, large companies saw sanctioned countries as fair game although arguably sanctioning countries have more power over such companies.
The international community is a state of anarchy since there is nothing higher than each sovereign state. Deals, agreements, treaties managed to be upheld most of the times through power play. The thing about most manifestation of power through diplomatic tools is that they are a weapon that massively destroys instead of specifically decapitate individuals. Careful planning, execution and tools must be curtailed to suit individual cases. Millions of innocence have fallen victims into the cruelty of oppressors, the least we can do is not to make it worse.
By: Aurora Maria Sarah | IlmuEkonomi 2014| Wakil Kepala Divisi Kajian Kanopi 2016
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