How sanctions work and how they do not
According to Daniel W. Drezner ,professor of international politics at Tufts University, there are 4 characteristics of an effective sanctions.
1. Specific demand – To ask the target country to do a specific job - To stop/start doing something like to stop proliferating their nuclear program.
The longest time the sanctions imposed against Iran were not clear whether they were to for its nuclear program or try to foment regime change. However this time under Trump’s regime the sanction were not clear.
2. Sanctions are effective if the imposing country has some relations with the other country.
3. Aim for money based sanctions rather than product based sanctions.
Through a ban of products there will be black marketing and local traders will be happy for such situation. However a financial based sanction will have severe restriction on the country. US sanctions against Iran were both trade and financial sanctions.
4. Make other countries support your sanction.
If you have other countries involved then it will be better as it will create more pressure on the country being imposed. Because otherwise the country being imposed sanction will be able to better out the situation by dealing and trading with other countries. Or may other countries may ban the imposing country.
In case of US sanction on Iran, Europe did not support the sanction. However the sanction is still effective as Dollar and US banking is quite effective in today’s world for international business. However now a days some emerging countries and developed countries have workarounds to go around US dollar and banking system and conduct international business.
In case of US sanction on Iran India still conducted various deals with Iran.
For US, since their currency is used across the world they need to understand that the more sanctions they levy there more leverage they loose in international market.
But there is a downside of imposing sanction which is it leads to more inequality as sanctions hit people with least power and economically vulnerable. The objective of any sanction is to change the behavior of a government but in reality it impacts the people who don’t have influence on the sanction or government.
For example in North Korea sanctions led to a situation where people were marginalized and Kim Jong Un and his associates in high power were not at all impacted.
In Iran people were already demanding basic necessity like food and water. And sanctions devalued their local currency making these items expensive and making situation more horrendous. The leader although were not impacted at all.
Though it may sound like that the sanctions may force the public to ask its government to change its attitude towards certain issues however it may produce an opposite effect. The public may show solidarity with its government and may support its decisions and creating the imposer country an enemy in the eyes of the public.
In certain cases sanctions may also create a situation where the government sensing danger to its existence through revolts may start imposing severe restriction on the public and creating much worse situations for them leading to sub human conditions.
In the end, according to Daniel, the best sanction is the sanction not imposed. A threat of imposing sanction keeps things out of public view between the government and may create some leeway for the target company to reach a mid-way with the imposing country’s demand.