The debate about sanctions and their humanitarian implications on populations at large came back into the limelight with the unfolding of the Covid-19 pandemic in Iran. Since the outbreak, a growing range of voices has taken a stance in favour of a partial lifting of sanctions, blaming them for preventing the country from mounting an effective public health response to the pandemic. It’s not clear how much such discussions have been driven by moral concerns or strategic opportunism. Whichever the real motivation behind them, though, well before the pandemic began sanctions had already been exacting a heavy toll on the country. A look back on their (mis)use in the past two years sheds light on their devastating impact on the general wellbeing of the Iranian population already before the crisis and on their role in creating those very uneasy trade and economic conditions that are now constraining Tehran’s response. But it also reveals the profound, negative impact their current reckless use can have overall on the future application of sanctions too.
On the use of sanctions
As a provocative but necessary premise, sanctions per se have never killed anyone. It’s the use you make of them (and the strategy behind it) that can. Sanctions are just a foreign policy instrument which can be used by policymakers in their broader strategies for diverse objectives and with many different functional logics in mind, of which only some do actually envisage a material damage. Historically, over the centuries, sanctions and military adventures used to be closely intertwined measures, where the former had generally been conceived as a prelude to the latter. Since the XX century, however, despite some early exceptions in which sanctions retained their distinct “martial flavour”, their use eventually changed for the good, becoming what it is still supposed to be today: an alternative to the use of military force. The emancipation of sanctions from warfare, which should be preserved also today, both in practice and in language, introduced more variety in the policymakers’ toolkit for the better, offering them greater leeway to tailor and even update over time their foreign policies to the different and changing realities they faced.
Unfortunately, recent history also abounds in cases in which the misuse of sanctions ended up creating the very same humanitarian disasters an outright war would have done. Sanctions-triggered humanitarian tragedies in Iraq and Haiti in the 1990s showed that the effect their use could cause could tragically be closer to that of the very military measures they tried to be an alternative to. Although sanctions have since become more “targeted” in their application, to some this has not been enough to lower their humanitarian impact and today there is no shortage of calls for a complete and total abandonment of sanctions, crudely equated with economic warfare, carpet bombing, or other images taken from the same war-like narratives. The weaponization of language can hardly bring any benefit whatsoever, nor can the limitation of policymakers’ options, should the sanctioning tool be completely abandoned one day. It is also true, though, that the impact sanctions have had on Iran in the past two years has cast doubts on the actual separation of the two fields, as recently the risk of an open Iran-US military confrontation has dramatically increased and the state of the Iranian economy has worsened as never before since the war with Iraq in the 1980s.
The impact of sanctions within the US strategy of maximum pressure
Since May 2018, with its withdrawal from the JCPOA, the United States has embarked on a strategy of maximum pressure whose backbone lies in the imposition of old and new restrictive measures of various kinds against Iranian entities and individuals, attached to a long list of tough (and clearly unfeasible) demands for the Iranian leadership, ranging from nuclear and ballistic proliferation concerns to terrorism-related issues and even something more. The US administration’s addiction to sanctions in its approach to Iran is quite evident when looking at the data on the designations made by the US Treasury’s Office of Foreign Assets Control (OFAC): by my count, in 2019 Iran-related entities and individuals were the most sanctioned category, making up nearly 28% of that year’s total designations. The percentage had peaked at 58% in 2018, precisely because of the reimposition of JCPOA-related sanctions, while the first four months of 2020 already saw 81 new Iran-related additions, representing 39% of the total so far.
This pressure has had a considerable impact on the Iranian economy, both at a macro and micro level, despite remarkable resilience built up over time. According to US Secretary of State Mike Pompeo and Special Representative for Iran Brian Hook, with the latest rounds of US restrictive measures more than 80% of Iran’s economy has been put under sanctions and 90% of its foreign-exchange reserves made inaccessible. As a consequence of foreign investments and oil revenues gradually drying up (oil exports plummeted from a peak of 2.5 million bpd in early 2018 to below 500,000 in late 2019, according to OPEC data), the country’s GDP shrank by 7.6% last year, after having contracted another 5.4% the year before. Data on non-oil GDP growth have always been less dramatic, and in fact some non-oil sectors even showed some signs of recovery in 2019, but still remained in negative territory (-4.2% according to the same IMF projections).
All this had a severe impact, especially on ordinary people’s lives. In the past two years, sanctions have contributed to further impoverishing them by reducing their purchasing power in a way that data can capture only partially. Annual inflation of consumer prices soared to 30% in 2018 and reached 41% in 2019 as per the IMF, nullifying the government’s previous efforts made to get it down to a single digit in 2013-2016. More detailed data from the Statistical Centre of Iran also show that inflation has risen in particular for food items, especially in rural areas. While recently the prices of food and non-alcoholic beverages have stabilised (in April 2020 they stood only 10% higher compared to the same month of the previous year), the year before they had grown by 85% year-on year, with red meat growing by 117%.
Experts have long argued (convincingly) that these economic troubles are to be blamed on a combination of domestic mismanagement, corruption, and sanctions, brushing up on the old problem of proper causal attribution in the evaluation of sanctions effects. However, the latest Iran Poll survey conducted between October and December 2019 provides clear insights at least about local perceptions on the impact of sanctions. And, according to the survey, 76% of the respondents acknowledged that sanctions were having a negative influence on the economic situation of the country as well as on their families. The survey took place almost coincidentally with the protests triggered by the government’s removal of some fuel subsidies last autumn, a long-time suggestion of the very IMF, whose adoption was hastened by the impact of sanctions. People’s dissatisfaction with the leadership was real, and so that wave of protestswas read by some as a sign of the political effectiveness of US sanctions. Was that the case?
Their political effects
Perhaps it is too early for an overall, conclusive assessment about whether such economic pressures have effectively translated into desired political concessions, but from the current situation on the ground, whichever the strategy’s baseline you select, results seem quite poor. Domestically, it’s precisely the most conservative factions that sanctions tried to stigmatize that have been empowered lately, and while public protests triggered by worsening economic conditions do have increased in frequency over the past two years as per ACLED data, any attempt aimed at turning the local population against the regime and closer to the US has missed the mark, as the local population’s unfavourable views of the US have rather grown steadily from 71% in 2016 to current 86%, while its support for the regime’s security objectives (which US sanctions oppose) has remained high. Regionally, since May 2018 the US strategy of maximum pressure has brought an increase in the regional provocations against US forces and allies, an expansion of Tehran’s nuclear enrichment activities, and major advancements in its ballistic missile programme. According to the US Congressional Research Service, then, sanctions have so far failed to constrain Iran from advancing its security objectives. Even worse, US sanctions have also failed to get the international community on their side.
Against this background, the US’ maximum pressure has thus only “succeeded” in making Iran’s life more difficult by degrading its economy and wellbeing, but at what costs? The overall assessment of a sanction-based strategy cannot exclude its related costs. Not only the human and economic costs attached to the target’s incompliance, but also those borne by the sanctioner itself. States turn to sanctions when they still want to achieve some policy objectives but both military interventions and inactions are too costly. Yet, often overlooked is the fact that the resort to sanctions can have extreme costs too. The act of sanctioning is an exercise of power which, when misused and poorly designed, can also end up degrading the very same power which is exercising it. The US’ maximum pressure against Iran is a case in point, as it has contributed to further alienating Washington’s historical allies and to damaging US credibility and prestige internationally. Even worse, it also contributed to undermining the future of sanctions themselves. Unlike the use of force, which they are supposed to be an alternative to, sanctions can be an extremely flexible tool, compatible with positive inducements, and able to adapt over time to changing conditions, including by providing relief, if needed. For the most part of the international community they are precisely so. Yet, for few others they have become a rigid, highly addictive, one-size-fits-all tool to be used for any problem. By creating a sanction architecture almost impossible to dismantle and in close proximity to warfare, the current US administration is slowly reversing the paradigm shift that made sanctions distinctively alternative to the use of force, both in their design and in the ductility of their application. A rethinking is highly necessary and desirable to save sanctions before they fully reacquire the regrettable “martial flavour” of their past. Perhaps, the widespread indignation triggered by the pandemic may help reverse this trend.