Half the World Hit by US Unilateral
Sanctions
by Someshwar Singh
South-North Development
Monitor - Third World Network
Dec. 1999
Geneva, 21 Dec 99
-- More than half of the world's population in 75 countries is subject to
unilateral coercive economic measures or 'sanctions' by one country alone
- the United States of America -
according to a recent report by the United Nations.
The report,
"Unilateral economic measures as a means of political and economic
coercion against developing countries" (A/54/486), was considered by the
UN General Assembly as part of the macroeconomic policy questions related
to trade and development. The issue is to receive greater focus by the
United Nations in the coming years, particularly by its human rights arm.
It is in response to
General Assembly resolution 52/181 of 18 December 1997, that the report
was prepared. In that resolution, the Assembly, inter alia, expressed
grave concern that the use of unilateral coercive economic measures,
particularly, adversely affected the economy and development efforts of
developing countries and had a general negative impact on international
economic cooperation and on worldwide efforts to move towards a
non-discriminatory and open multilateral trading system.
In the same
resolution, the General Assembly urged the international community to
adopt urgent and effective measures to eliminate the use of unilateral
coercive economic measures against developing countries that were not
authorized by relevant organs of the United Nations or were inconsistent
with the principles of international law as set forth in the Charter of
the United Nations, and that contravened the basic principles of the
multilateral trading system.
The Assembly
reaffirmed that no State might use or encourage the use of unilateral
economic, political or any other type of measure to coerce another State
in order to obtain from it the subordination of the exercise of its
sovereign rights.
In addition to
replies received from 13 States on the subject (including from the United
States), the report also contains a gist of the views of internationally
renowned think-tanks on the subject. An ad hoc expert group meeting was
convened by the Department of Economic and Social Affairs of the United
Nations Secretariat.
The members of the
expert group participating in their personal capacities were: Claude
Bruderlein (Switzerland); David Cortright (United States); Margaret P.
Doxey (Canada/United Kingdom of Great Britain and Northern Ireland);
Kimberly Ann Elliott (United States); Helga Hoffmann (Brazil); Randhir B.
Jain (India); Hasan-Askari Rizvi (Pakistan); Nicolaas J. Schrijver
(Netherlands); and Geedreck Uswatte-Aratchi (Sri Lanka).
The group had before
it five working papers presented to the meeting: "Coercive economic
measures: the risks and costs of unilateralism" by Margaret P. Doxey; "The
use of coercive economic measures: an international law perspective" by
Nicolaas J. Schrijver; "Making sanctions smarter? The effects of financial
sanctions" by Kimberly Ann Elliott; "Targeting financial sanctions: a
review of the Interlaken process" by Claude Bruderlein; and "Bombs,
carrots, and sticks: the role of economic sanctions and incentives in
preventing the proliferation of weapons of mass destruction" by David
Cortright
The expert group
noted the low level of effectiveness of unilateral coercive economic
measures which are often counter-productive in bringing about the desired
policy changes, may entail unwelcome political risks and excessive
economic costs, give rise to serious humanitarian and ethical concerns,
run counter to development goals and limit the scope for diplomacy,
positive economic measures and international cooperation in general.
In particular, the
group expressed its deep concern about the potential and actual adverse
effects of unilateral coercive economic measures on developing countries
and the structure of international relations, especially in the area of
trade and development.
Therefore, the group
concluded that, in a general sense, the use of unilateral economic
measures as a means of political and economic coercion, especially the
practice of secondary boycotts against third-party States, should be
strongly discouraged.
The group agreed that
the unilateral imposition of coercive economic measures is inconsistent
with core principles and norms of international economic law, such as (a)
freedom of international trade, investment and navigation; (b)
non-discrimination, including the so-called most-favoured nation (MFN)
clause and the concept of national or equal treatment; and (c) sovereignty
over natural resources and the right to regulate foreign investment and
economic activities.
It was duly noted
that those principles are subject to a number of restrictions, exceptions
and waivers, some of which may be invoked in a self-governing fashion,
primarily for the protection of national essential security interest.
Nevertheless, the group felt that unilateral measures of coercion are
increasingly at odds with the evolving principles and rules of
international economic and social cooperation that are embodied in the
Charter of the United Nations and the constituent treaties of multilateral
trade and financial institutions, such as the World Trade Organization,
and that seek to provide, inter alia, mechanisms and procedures for
collective policy review and dispute settlement.
In particular, the
group expressed its deep concern about the extraterritorial jurisdiction
and third-party effects of certain unilateral measures of economic and
political coercion against developing countries (namely, the 1996 United
States legislation on sanctions against Cuba, the Islamic Republic of Iran
and the Libyan Arab Jamahiriya) and shared the view that such measures
were irreconcilable with basic norms and principles of international law
and inconsistent with the objectives of the multilateral trading system.
To minimizing the
adverse effects of coercive economic measures on the general population,
particularly its most vulnerable groups, the expert group reviewed the
current unilateral and multilateral approaches.
These options
include: (a) sparing use of unilateral coercive economic measures; (b)
choosing non-coercive measures of a symbolic or persuasive nature (for
example, a wide range of diplomatic, political and cultural measures can
serve to convey a message of disapproval rather than attempt to force a
change in policy by disrupting the economy); (c) mandatory humanitarian
exemptions from trade embargoes or comprehensive sanctions regimes with
regard to export of food, medicine and other essential humanitarian goods;
(d) employment of smart or targeted sanctions which are designed to
penalize directly those individuals or policy makers who are responsible
for an objectionable action; and (e) combining sanctions with incentives
or inducements for cooperation and compliance.
The group observed
that among various improvements and alternatives, the concept of smart
sanctions has recently attracted the widest attention, at both the
national and international levels. The rationale behind this approach is
twofold: (a) to target the effects, as much as possible, on the political,
military or economic elites responsible for objectionable policies or
criminal individuals, thus enhancing the effectiveness of sanctions; and
(b) to spare the innocent victims who have no control over policy or power
to change it, thus making sanctions less blunt.
Smart sanctions
include targeted financial measures, particularly asset freezes,
visa-based restrictions on international travel, and participation bans.
Under the heading of smart sanctions, reference is also made to selective
trade sanctions that may involve restrictions on those particular products
or services (for example, weaponry and luxury items) that are more likely
to affect the targeted elites or criminal entities rather than the general
population.
Particular attention
was paid to the issue of targeting financial sanctions and their effects.
There is evidence to suggest that financial sanctions may be relatively
more effective than trade embargoes., the experts contend.
In the most
comprehensive empirical analysis of economic sanctions to date, financial
sanctions were found relatively more likely to contribute to the
achievement of foreign policy goals than either financial sanctions
imposed in conjunction with trade controls or trade sanctions employed
alone.
In general, financial
sanctions are perceived as measures of greater effectiveness because they
are relatively easier to enforce by senders, harder to evade by targets
and often spur market-reinforcing effects. However, unilateral financial
sanctions will be less effective than similar multilateral measures.
Targeting financial stocks (for example, overseas government-owned or
private assets) is relatively easier than focusing on financial flows,
especially those from private sources. In principle, money is fungible and
the problem with targeting financial flows is that the more targeted the
sanctions are, the easier they will be to evade.
The expert group
reviewed the potential effects of various types of financial sanctions on
the target country from the perspective of their targetability (that is to
say, making them not only more effective, but also less blunt). It was
concluded that narrowly targeted financial sanctions, such as freezing the
overseas assets of individuals from the target country, would have the
fewest and lowest collateral impacts on the general population, but are
often difficult to implement and may be relatively easy to evade,
especially with political constraints impeding the ability of the sender
Government to act quickly.
Moreover, the effects
of such measures may be limited or diminish over time if the targeted
individuals can successfully hide their assets or have unrestrained access
to economic resources within their country or new financial flows from
abroad. Nevertheless, financial sanctions narrowly targeted against
individuals have been used unilaterally to address, inter alia, such
issues as drug trafficking and terrorism.
On the other hand,
broad restrictions on international lending and foreign investment can
cause significant economic disruption and social hardship in the target
country and are therefore not necessarily more humane than trade
embargoes. The impact on the target will be harder to evade and will be
reinforced by market perceptions and mechanisms. However, targeting these
measures more precisely is also likely to make them easier to evade. The
ability to evade targeted financial sanctions tends to increase with
income in the target country and the degree of sophistication of its
financial markets. Outside comprehensive sanctions regimes, restrictions
on private financial flows have been relatively rare. Although broad
financial sanctions may have potentially high costs to creditor countries,
they are likely to entail lower enforcement burdens than broad trade
embargoes.
The most commonly
used financial sanctions affect government programmes or official flows,
including economic and military assistance, trade credits and political
risk insurance. From the sender's perspective, this type of financial
sanction is relatively low-cost and difficult to evade. Although the
utility of this tool decreases as aid flows decline, the denial of aid
from traditional donors may produce rather harmful effects on low-income
and least developed countries which have little access to private
financial markets. For humanitarian reasons, it is essential that food aid
and concessional multilateral lending be consistently exempted. However,
restrictions on economic aid, other than humanitarian assistance, may have
limited effects on the population of target countries with corrupt
Governments.
The expert group
welcomed the Interlaken process on the targeting of multilateral financial
sanctions, sponsored by the Swiss Government, with a view to improving the
effectiveness of such measures as well as minimizing the negative
humanitarian impact often experienced by large segments of civilian
population as a result of comprehensive sanctions regimes.
Based on a growing
sense of individual responsibility and accountability for internationally
wrongful or criminal acts, the main objective of the Interlaken process
has been to elaborate on the specific requirements of targeted financial
measures as a tool for exerting pressure directly on the target country's
decision makers and supporters by localizing and freezing their wealth
(that is to say, financial assets and transactions) on the world financial
markets.
Although serious
technical, legal and administrative difficulties remain in this area,
important progress has been made on formulating draft policies that would
control the movement of assets and link national and international
institutions in enforcing such controls. Most importantly, the Interlaken
process has established a foundation for an informal cooperation
mechanism, with the participation of Governments, the financial sector and
academic think-tanks and experts, to facilitate the implementation of
targeted financial sanctions, the report notes.
The Commission on
Human Rights, in its resolution 1999/21 of 23 April 1999 on human rights
and unilateral coercive measures (see E/1999/23 (Part I), chap. II, sect.
A), urged all States to refrain from adopting or implementing unilateral
measures not in accordance with international law and the Charter of the
United Nations, in particular those of a coercive nature with
extraterritorial effects, which created obstacles to trade relations among
States, thus impeding the full realization of the rights set forth in the
Universal Declaration of Human Rights and other international human rights
instruments, in particular the right of individuals and peoples to
development.
The Commission also
rejected the application of such measures as tools for political or
economic pressure against any country, particularly against developing
countries, because of their negative effects on the realization of all
human rights of vast sectors of their populations, inter alia, children,
women, the elderly, and disabled and ill people; reaffirmed, in that
context, the right of all peoples to self-determination, by virtue of
which they freely determined their political status and freely pursued
their economic, social and cultural development; and also reaffirmed that
essential goods such as food and medicines should not be used as tools for
political coercion, and that under no circumstances should people be
deprived of their own means of subsistence and development.
In the opinion of the
United States, "there needs to be a foreign policy tool for situations in
the middle, when diplomacy has been inadequate, but force is not yet
appropriate. This is the place of sanctions, including economic sanctions.
It is important that the international community keep this potentially
valuable tool at its disposal. If sanctions are unavailable for whatever
reason, nations may feel they have no choice but to give in to intolerable
threats, or proceed to force. Therefore, all States should recognize that,
in principle, sanctions are legitimate."
The United States
agrees that multilateral sanctions are preferable. "Nevertheless, there
will come times when a nation must be prepared to act unilaterally if
important national interests or core values are at issue and if attempts
to build multilateral sanctions have been unsuccessful. Consequently, the
United States reserves the right to use sanctions unilaterally when
necessary. There will continue to be times when global responsibility will
require effective sanctions. For that reason, all States should concur
that such measures are legitimate."
In the opinion of
Cuba, to agree that a country, however powerful, may use force in order to
compel one or more other countries, by means of economic measures, to do
its bidding will lead to chaos in international relations and will detract
from the World Trade Organization as a global trade regulatory agency and
as a framework for resolving trade disputes through established
multilateral procedures.
Cuba pointed out that
unilateralism by the United States was not directed against Cuba alone.
"During the past 80 years, such sanctions have been imposed on various
countries on 120 occasions, 104 of them since the Second World War.
According to information provided by the President of the United States'
own closest advisers, such unilateral measures were used against 75
countries accounting for 52% of the world's population during 1998."
Interestingly, the
member States of European Union abstained in the vote on General Assembly
resolution 52/181. But, it is the view of EU that economic measures must
be in keeping with the principles of international law, as laid down in
the Charter of the United Nations, and with the broadest interpretation of
the principles of the multilateral trading system set up by the World
Trade Organization.
"Unilateral coercive
economic measures that violate international law must not be taken against
any member of the international community notwithstanding the level of
development," in the EU's view. "In addition, EU makes a distinction
between measures imposed unilaterally by individual States and those that
are undertaken with full authority of the Security Council and in
conformity with the Charter of the United Nations." (SUNS4578)
The above article
first appeared in the South-North Development Monitor (SUNS) of which
Chakravarthi Raghavan is the Chief Editor.
[c] 1999, SUNS - All rights reserved. May not be reproduced, reprinted or
posted to any system or service without specific permission from SUNS.
This limitation includes incorporation into a database, distribution via
Usenet News, bulletin board systems, mailing lists, print media or
broadcast. For information about reproduction or multi-user subscriptions
please contact <
suns@igc.org >
BACK TO
TOP ■
PRINTER-FRIENDLY VERSION ■
COMMENT
© 2005 Bulatlat
■
Alipato Publications
Permission is granted to reprint or redistribute this article, provided
its author/s and Bulatlat are properly credited and notified.