| ID | 145201 |
| Title Proper | True costs of financial sanctions |
| Language | ENG |
| Author | Arnold, Aaron |
| Summary / Abstract (Note) | In summer 2015, the United States, United Kingdom, France, Russia, China and Germany – collectively known as the P5+1 – inked a historic agreement with Iran, which obstructed Iran’s pathways to a nuclear weapon in exchange for sanctions relief. To be sure, the sanctions had taken a toll on Iran’s economy. From 2012 to 2014, macroeconomic indicators suggested Iran was in serious trouble. It would be easy to infer that global economic and financial sanctions were successful in bringing Iran to the negotiating table, a finding that would shore up perceptions of economic and financial sanctions as a cost-effective, low-risk and reproducible policy instrument. But it is important not to oversimplify sanctions’ effects. Lumping together economic (that is, trade-based) sanctions and financial sanctions tends to minimise the broader consequences of the latter. Failing to consider the range of effects that different kinds of sanctions can bring about will ultimately diminish policymakers’ capacity to deploy financial sanctions as a longer-term foreign-policy instrument. Iran’s almost complete exile from the global financial system, which encompasses both formal and informal institutions that facilitate the flow of capital for trade and investment, provides a unique case study to examine how and why institutions adapt, as well as any potential consequences of that adaptation. |
| `In' analytical Note | Survival : the IISS Quarterly Vol. 58, No.3; Jun-Jul 2016: p.77-100 |
| Journal Source | Survival Vol: 58 No 3 |
| Key Words | Non-proliferation ; Sanctions ; Iran ; United States |