Economic sanctions and International laws
In last 3 months or so, International sanctions have been in the news in light of Russia-Ukraine conflict. The moves initiated by United States have been followed up by its allies mainly in Europe. It’s imperative to examine nature of these sanctions and further, do such sanctions carry any validity under International Law.
Sanctions are primarily, political decisions which graduate into
diplomatic and economic steps, initiated by countries unilaterally or
multi-laterally (through United Nations) against other countries or
organizations or specific persons, under the notion of disciplining them. Real
aim is to protect security interests of the sanctioning country while the purported
aim could be maintenance of world peace. Sanctions are interventions for
punishing an adversary, short of waging war with them, virtually bridging the gap between mere protest /denunciation and
use of force. But the political
character of these sanctions cannot be negated. These are generally used by
countries as a foreign policy tool to protect their own geo political interests
and to score a political point against adversaries viz. US sanctions against
Iran, Syria, Venezuela or Russia. As the cliché goes, sanctions are steps between
“words and wars”.
Sanctions can take several
forms eg imposition of trade restrictions, downgrading of diplomatic relations
including withdrawal of diplomatic staff from the sanctioned country) or
restrictions on sports persons (like barring of players from Russia and Belarus
by Wimbledon). Sanctions nevertheless, remain political in nature and the main
thrust is to hit trade and commerce of the adversary sanctioned country.
We shall focus on the
economic and trade aspect of sanctions since they are capable of affecting
global economy (as against localized impact of diplomatic or sports sanctions)
and even countries which are not directly or indirectly involved in the dispute
as we have seen through US/EU sanctions on Russia.
Economic Sanctions
Economic sanctions may be defined as imposition
of a ban on customary trade and commercial relations, either with an entire
country or blocking dealings with specific organizations or individuals. Sanctions
may include
-
Trade
embargoes which may include a total ban on trade with a country (including a
full naval blockade) with possible exceptions within the total basket eg for medicines, food etc.
-
Export
/import controls restricting export to or import from the sanctioned country,
of certain specific items
-
Capital
controls – Putting restrictions on movement of capital from and to the targeted
country
-
Asset
freezes – Physical or financial assets
of the targeted country may be frozen preventing their withdrawal or disposal
in any other form ;
Earliest recorded economic sanctions refer to Napoleon's blockade of Great Britain in 1806-07, through
what is known as the Continental system. In modern era , League of Nations imposed
sanctions against Italy (1935) and then United Nations has imposed sanctions
against South Africa (for apartheid), Rhodesia (now Zimbabve), Iraq,
Cuba, Burma (Myanmar) etc.
Why sanctions ?
Although various reasons have been propounded for imposition of
sanctions viz. threat to global security, breach of international peace ,
violation of human rights, terrorism activities
etc. but the fundamental motive behind sanctions are political.
Sanctions are being used as a tool of foreign policy for furtherance of own geo
political goals of the sanctioning country.
Sanctions are being used as an instrument of political power.
Sanctions have been imposed to coerce, deter,
stigmatize or punish political adversaries who may harm interests or impinge on
sphere of influence of sanctioning countries. Sanctions come into force in
situations where a war of words fails to influence or deter the targeted
country and the sanctioning country doesn’t want to escalate the situation to
an armed conflict.
Effectiveness of economic
sanctions Do they really work?
Sanctions are generally arbitrary. It has been observed that sanctions with limited objectives have a greater chance of attaining the desired objective. To be effective, sanctions should be able to change the behavior of the targeted country. Except in rare cases (South Africa, Rhodesia) sanctions have not been very effective in impacting behavior of target countries (Cuba, Russia ).
Instead of affecting the
deviant behavior of rulers of the target country, economic sanctions generally
bring misery to the general public of that country in the form of food
shortages and general collapse of economy. They affect businesses and trade
flows. In such cases, general public hardly has any choice of changing the
ruler and on the contrary, the economic miseries make the public more
nationalistic thus strengthening hold of the deviant ruler.
Sanctions also damage the sanctioning country, in some cases in equal measure. For example EU’s Russia sanctions, have caused economic impact in EU countries as well through shortages of oil and gas. Viktor Orban, the Hungarian Prime Minister and an admirer of Russian President Vladimir Putin is reported to have stated that by imposing economic sanctions on Russia, EU has "shot itself in the foot". Incidentally Hungary is a member of EU.
For US particularly, frequent usage of sanctions may harm it in the long run. Right now it holds dominant position in International trade due to wide acceptance of US Dollar as international currency. Arbitrary freezing of assets parked in US Dollars and blockage of international trade transactions routed through US Dollars platform, shall force countries to look for other options. This process may weaken US Dollar as well as US dominance, in the long run.
Sanctions
in international law
International sanctions have been described as “deliberate,
government inspired withdrawal or threat of withdrawal of customary trade or financial
relations” (Sanctions by Kimberly Ann
Elliot and Gary Clyde Hufbauer 1990). The term generally refers to coercive
measures, taken by one State or in concert by several States, which are
intended to convince or compel another State to desist from engaging in acts
violating international law (Joyner,
Christofer. 1995. Collective Sanctions as Peaceful Coercion: Lessons from the
United Nations Experience)
Sanctions are generally expected to affect economic ties between
the sanctioning and sanctioned countries, but in several recent instances they
have had global impact in the sense that sanctions prohibit anybody and
everybody from dealing with the sanctioned country. eg US sanctions on Iran.
Such instances are perceived to impinge on the sovereign rights of third
countries.
International sanctions
are imposed either by the United Nations (UN) representing the global community or by
individual countries or by a group of countries acting in concert. While the UN
is empowered to impose sanctions by virtue of its charter, it’s the latter ie
unilateral sanctions which invite flak as having no validity under
international law. This brings us to the core of this discussion that
Unilateral Sanctions are a political tool (enforced through national laws) but
they may not carry any validity under International law .
UN backed sanctions
UN Security Council (UNSC) is authorized to impose sanctions (short of war) by virtue of powers given by Articles 39 and 41 under Chapter VII of the UN Charter.
Article 39 states that: “The
Security Council shall determine the existence of any threat to the peace,
breach of peace, or act of aggression and shall make recommendations, or decide
what measures shall be taken in accordance with Articles 41 and 42, to maintain
or restore international peace and security”. Article 41 goes on to say “The
Security Council may decide what measures not involving the use of armed force
are to be employed to give effect to its decisions, and it may call upon the
Members of the United Nations to apply such measures. These may include
complete or partial interruption of economic relations and of rail, sea, air,
postal, telegraphic, radio, and other means of communication, and the severance
of diplomatic relations.”
Thus sanctions mandated by Article 41 are meant to push erring
nations to maintain international peace These powers were first used against
Rhodesia (now Zimbabwe) in 1966, followed by several such instances in case of South
Africa, Haiti, Iraq, Angola, Sierra
Leone, Somalia, Eritrea, Liberia, Democratic Republic of Congo (DRC), Côte
d’Ivoire (Ivory Coast), Sudan , Lebanon, North Korea, Iran, Libya, Yemen, South
Sudan etc etc These powers have also been used against organizations like Al
Qaeda and Taliban.
Non-UN Sanctions
In October 2002, the UN General Assembly adopted a Libya sponsored resolution calling on all States not to recognize or apply Unilateral coercive economic measures or legislation imposed by any State across territorial boundaries, which were contrary to recognized principles of international law. It is interesting to note that the said resolution was adopted by a recorded vote of 133 in favour to 2 against (Israel, United States) and two abstentions (Australia, Latvia), But UNGA’s resolutions lack enforceability . While Article 2(4) of the UN Charter expressly prohibits use of force, there is no express provision prohibiting coercive economic measures.
Unilateral sanctions without UNSC’s authorization have been criticized as they infringe the sovereign right of a state to economic and social development. While terming such unilateral actions as “counter measures” the International Law Commission (ILC) has talked of exceptions covered by provisions of Articles on Responsibility of State for Internationally Wrongful Act (ARSIWA), 2001, eg in case of self defence. But such counter measures should not involve any use of force or infringe human rights..
Thus unilateral sanctions are just a foreign policy tool, carrying a very limited validity under International law. Such sanctions, generally imposed under national laws, run the risk of disrupting the established international order, as governed by the UN charter.
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