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US Sanctions: Their Meaning, Implementation Mechanisms

31.07.2019
Article from AFRIC Editorial
Today, on a par with UN sanctions, US economic sanctions are equally global. Due to its special economic and financial position, as well as the support of allies, the United States has the opportunity to have the most significant impact on the economic situation of certain countries in the world. Thus, using sanctions as an instrument of international politics, the United States exerts influence on foreign and domestic policies of various countries. Consider the example of African countries, the practice of applying US sanctions.

Sanctions are considered as a compromise response to undesirable actions of a particular state. Unlike diplomatic measures, sanctions have a much more pronounced effect on the economy of the target country, and are much more likely to lead to a change in the behavior of a state in the international arena. At the same time, unlike military measures, sanctions are a much less expensive option to respond to undesirable actions of the other side and at the same time carry a much lower risk of further escalating the conflict.This is expressed, above all, in the possibility of the gradual introduction of restrictive measures and their cancellation, a close linkage of restrictions to the fulfillment of certain requirements, as well as a greater likelihood of minimizing the risks to the civilian population of the country in relation to which restrictions are imposed.

Relevance of sanctions

Recently, the topic of sanctions remains one of the central issues for discussion not only among specialized experts in international affairs, but also the general public. This is largely due to the Ukrainian events that entailed a series of restrictive measures against Russia, primarily from the United States. Discussions around economic sanctions mainly come down to an assessment of their impact on the economy of a country in respect of which such measures are being introduced, and, in general, to the question of the effectiveness and acceptability of such a foreign policy tool. At the same time, sanctions should be considered as an instrument of foreign policy that has become the most effective in the hands of the United States.

Legal basis and mechanism for imposing sanctions in the United States

Thanks to its broad financial and economic opportunities, the United States of America is most actively applying economic sanctions to protect its own interests. The issue of imposing sanctions in the United States is regulated by a number of laws. The regulations provide the US president with an opportunity to declare a state of emergency in response to actions by a state or a non-state actor that may pose a threat to US interests or security. In turn, the US Congress may impose restrictive measures, or modify the existing sanctions regimes.

Most of the current US sanctions regimes are coordinated by the Office of Foreign Assets Control (OFAC), which reports to the US Treasury Department. In turn, the State Department of the United States (the ban on entry to the United States, the recognition of terrorist activities), the Department of Defense, the Department of Energy, the Ministry of Justice, the Department of Commerce and other departments also participate in regulating the sanctions regime.

Types of sanctions
Among the main possible restrictions that are imposed by the United States in the framework of sanctions programs, there are:

1. Freeze assets;
2. Prohibition of entry to the United States;
3. Restrictions on the export of certain groups of goods (including high-tech and dual-use goods);
4. A ban on the supply of weapons and military equipment;
5. Restricting access to the US financial market;
6. Prohibiting US citizens, as well as US-registered companies and their affiliates from entering into certain types of economic relations with objects of sanctions (in the case of individuals and legal entities);
7. Limit development assistance, etc.

Responsibility for violation of sanctions

In the US, there is a well-developed system of penalties and fines for violating the sanctions regimes. The Office of Foreign Assets Control (OFAC) provides relevant guidance. Fines are fixed and may be revised for inflation.
Depending on the combination of these parameters, it is possible to assign various penalties for violation of the sanctions regime, which may imply, including criminal liability, imprisoned for a long time.

The total amount of fines may significantly exceed that established in the relevant regulations and guidelines. Given the position and role of the United States in the global financial system, as well as the parameters of sanctions regimes, often many financial institutions, especially banks, are subject to much more serious penalties. The most graphic example is the largest French bank – BNP Paribas, forced to pay $ 8.9 billion for violating the sanctions regime against Cuba, Iran and Sudan; HSBC ($ 1.9 billion fine in 2012 for violating sanctions against Myanmar, Cuba, Iran, Sudan and Libya), Commerzbank AG ($ 1.45 billion for violating sanctions against Iran and Sudan).

Despite the fact that economic sanctions are just one of the instruments of foreign policy, they are the focus of expert and academic discussions at the moment. As a rule, the discussion of restrictive measures includes the following question – the effectiveness of sanctions. The purpose of sanctions is to change the behavior of a country. And this figure is quite easy to calculate. In the example of African countries, it is clear that the effectiveness of the application of US sanctions is approaching 100%.Theoretically, sanctions are the most optimal alternative to diplomatic and military measures of influence. However, sanctions do not always lead to the achievement of the desired effect, and sometimes even lead to opposite results, i.e. activation of undesirable actions by the object of sanctions.

Article from AFRIC editorial

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