U.S. economic sanctions losing effectiveness, expert says

PanARMENIAN.Net - While the use of sanctions remains a valuable tool for pursuing U.S. interests abroad, their efficacy is slowly diminishing and could spur unintended consequences amidst a changing global balance of power, says Richard Nephew, a former Obama administration official instrumental in devising current sanctions against Iran.

The United States’ immense economy allows it to apply pressure on it foes, Nephew writes in the new paper released Thursday May 21, by the Center on Global Energy Policy an Columbia University. “But, it is not certain that this advantage will persist in the future or that it will be as strong, as other countries expand and develop economically,” he writes, according to Al Jazeera America.

While at the State Department during the Obama administration, Nephew helped coordinate sanctions policy against Syria and Russia. He was also the National Security Council’s Iran expert when sanctions on the country reached their apex, prior to the resumption of nuclear talks between Iran and six world powers in 2013.

Sanctions remain a valuable tool, says Nephew, and he believes they were successful in getting Iran to the negotiating table over its nuclear program. But he warns that they cannot be leaned on too heavily.

“The United States may find over time that its ability to impose its will upon the international system by economic means has been dramatically reduced,” Nephew writes.

The rise of the China-led Asian Infrastructure Investment Bank (AIIB), according to Nephew, is a clear example of dwindling U.S. economic influence. Most analysts see the bank as a counter to the U.S.-supported International Monetary Fund. The U.S. has campaigned against countries joining up to the AIIB. But those efforts have been largely unsuccessful.

Nephew says that economic sanctions could not only be less effective, but they could also be turned against U.S. interests. Nephew mentioned two possible future scenarios.

One concerns U.S. relations with China, whose GDP is predicted to surpass that of the U.S. at some point between 2020 and 2030. Unhappy with U.S. policy in Taiwan, which continues to be a source of tensions between Washington and Beijing, China could eventually take action against U.S firms that operate on the China-claimed territory.

Nephew also cites the example of European Union policy toward Israel. While the U.S. and EU are major trading partners and have largely aligned economic interests, EU diplomats have sometimes taken a tougher line on Israeli settlements in the West Bank than their U.S. counterparts. Nephew argues that it is not inconceivable that should negotiations between Israelis and Palestinians fail to resume, the EU could in the future embrace a policy of targeted sanctions on Israel. In that case, Nephew says, U.S. firms with interests in Israel and Europe could face a difficult choice between the two markets.

Nephew remains an advocate for the use of U.S. sanctions, but says “there is a danger in that convenience.”

“By creating sanctions precedents and a permissive global norm to their use nationally, the United States may have also laid the foundation for a counteroffensive from its strategic adversaries and economic competitors that will seek to use their own asymmetric advantages in furtherance of their own aims,” he writes.