IEA report condemns the use of trade sanctions

Ordinary citizens will suffer if further sanctions are imposed on Burma

In a report* published today by the IEA, Professor Charles Rarick** produces a damning indictment of the use of economic sanctions. Rarick says "sanctions are imposed for good causes but they do much collateral damage - they undermine economic freedom, raise business costs, cause unnecessary pain and suffering in the country on which they are imposed and do not generally achieve their objectives."

The US, the report notes, currently has major sanctions against 12 countries and the use of sanctions has increased considerably in the last 25 years. Minor economic sanctions can be imposed by the US with little political discussion.

The report shows how sanctions have had little chance of imposing significant economic harm on the recipient country unless there is complete international unanimity. Indeed, economic sanctions against Burma have helped Burma develop closer relationships with China - something that is not necessarily to the long-term benefit of the people of Burma or the West. Where they do impose economic harm on the recipient country, they make life difficult for ordinary citizens - the very people that they are intended to help. Often sanctions cause malnutrition, rocketing prices for necessities, deterioration in health and even death on a large scale. The governing elite will not normally suffer and can often benefit from abusing the black markets that develop.

The evidence suggests that in only around a quarter of cases do economic sanctions achieve their aim and shows that sanctions, including those against Burma, have undermined reform movements within government.

The report concludes that economic sanctions only work where modest policy change is required, the recipient country does not get support from a third party and the recipient country is economically and politically weak. It further suggests that there is no ethical basis for sanctions which punish the already suffering people of a poor country in the hope that their long-term position might improve: normally that hope is not fulfilled.

To download the report click
here
.

*‘Economic sanctions, failed foreign policy tool and a cost to American business’ by Charles A. Rarick, Economic Affairs, Vol 27, No. 3, Institute of Economic Affairs, £7.50.

**Charles A. Rarick is Professor of Management and Director of International Business at Andreas School of Business, Barry University, Florida, USA.

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