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  • When policymakers want to respond to foreign challenges or influence a desired outcome,

  • there is a favorite nonlethal tool in their bag of tricks: Economic sanctions.

  • From the U.S. embargo on Cuba to international sanctions on Iraq over its invasion of Kuwait,

  • the effectiveness of sanctions, as a whole, has been widely debated.

  • Myanmar is the latest target of sanctions after a military coup at the start of 2021.

  • So how effective are they?

  • Sanctions come in different forms depending on the desired outcomes, similar to a carrot

  • and stick approach used in negotiations.

  • Besides economic and trade sanctions, these measures include targeted actions such as

  • arms embargoes, travel bans, asset freezes and commodity restrictions.

  • These sanctions can be imposed by a single country or multilaterally,

  • by like-minded nations or international bodies such as the UN and the EU.

  • To date, the UN Security Council has imposed 30 sanctions regimes, with the shortest lasting

  • nearly a year involving an arms embargo on Eritrea and Ethiopia in 2001

  • while the longest sanctions regime currently in force dates back to 1992 on Somalia.

  • Sanctions can be wide-ranging or targeted.

  • Wide-ranging sanctions, also known as comprehensive sanctions, ban all transactions with a specific country

  • while targeted ones affect specific individuals or entities

  • minimizing the negative effects on the general population.

  • Myanmar is no stranger to sanctions.

  • Since 1988, broad sanctions programs were employed against the country's military regime

  • by the U.S., while the EU adopted an arms embargo in 1996.

  • Straddled between India and China

  • Myanmar was one of the wealthiest countries in Southeast Asia at the start of the 20th century.

  • After the military, known as the Tatmadaw, seized power in 1962

  • Myanmar was isolated from the international community for nearly half a century.

  • Efforts to create a socialist state crippled the economy,

  • and in 1987, Myanmar was included in the UN's Least Developed Country list,

  • just when the rest of Southeast Asia was experiencing strong economic growth.

  • In the years since, the U.S., EU and other countries tried to

  • to force the military junta into political rapprochement

  • with the opposition National League for Democracy, led by Nobel Peace Prize laureate Aung San Suu Kyi,

  • by tightening the sanction screws, without much success.

  • Towards the end of 2010, the junta embarked on a series of reforms,

  • including holding the country's first election in 20 years,

  • which was won by a military-backed civilian party,

  • and releasing Suu Kyi after seven years of house arrest.

  • Shortly after her release in 2011, Suu Kyi called for Western sanctions to continue,

  • prompting the military rulers to demand an apology.

  • After winning a parliamentary seat in a by-election in 2012,

  • Suu Kyi's NLD clinched a landslide victory in the 2015 general election and formed the next government.

  • By then, the U.S. and EU had eased several of their sanctions on the country.

  • Even as the democratic reforms continued, tensions were building between the military

  • and Suu Kyi's government.

  • In 2021, the military, citing voter fraud in the November 2020 elections,

  • launched a coup and arrested Suu Kyi, along with senior members of her party.

  • A one-year state of emergency was declared, with the Tatmadaw promising to hold a "free

  • and fair general election" thereafter.

  • Amid rising casualties in Myanmar as protesters clash with the military, some countries have

  • reimposed targeted financial sanctions against leaders of the military coup,

  • their family members and business interests.

  • The punitive measures are on top of existing sanctions on some generals over the persecution

  • of the Rohingya Muslim minority.

  • While some critics argue that these sanctions are largely symbolic and the Tatmadaw leaders

  • have been impervious to past measures, the UN rapporteur on human rights in Myanmar,

  • Tom Andrews, said that it's worth a shot.

  • We just have to have the political will to exercise those options

  • and they're certainly worth trying.

  • I'm not saying they are necessarily going to be a panacea, but they're worth trying.

  • The U.N. Security Council says thatsanctions do not operate, succeed or fail in a vacuum

  • and that they are the most effective when applied as part of a comprehensive strategy

  • encompassingpeacekeeping, peacebuilding and peacemaking.”

  • Experts say that there are a few pillars of an effective sanctions policy.

  • Firstly, sanctions policies should be well-rounded with both punitive measures and incentives

  • to sweeten the deal, as was the case with Libya in 2003, when the country agreed to

  • dismantle its weapons of mass destruction program.

  • Sanctions should also be attainable and realistic.

  • For example, trying to induce regime change through sanctions would be an unrealistic goal,

  • which was what happened with the U.S. embargo on Cuba under Fidel Castro.

  • Another key pillar is multilateral support, especially in cases where the target is economically diversified.

  • In March 2021, the U.S., Canada, EU and the United Kingdom coordinated to impose sanctions

  • on Chinese officials for alleged human rights abuses in Xinjiang.

  • Last but not least, sanctions must be credible and flexible for the targets to feel the pinch

  • while recognizing the benefits of good behavior.

  • Increasingly, policymakers are recognizing the unintended consequences of wide-ranging

  • sanctions and are opting for targeted measures instead.

  • According to the UN, the U.S.'s embargo on Cuba has cost the country $130 billion

  • over nearly six decades.

  • After the U.S. imposed comprehensive trade sanctions on Myanmar in 2003,

  • a report released by the U.S. State Department a year later

  • noted that at least 50,000 jobs in the garment industry were lost.

  • In 1995, the UN Security Council recognized that its wide-ranging sanctions created

  • adverse side-effects of sanctions on the most vulnerable segments of targeted countries.”

  • Since 2004, all sanctions by the UN security council have been targeted at specific individuals

  • or businesses affiliated to or operating in a target country.

  • Before the coup, the World Bank projected that the poverty rate in Myanmar could increase

  • from 22.4% to 27% because of the pandemic.

  • Any comprehensive sanctions of the past will likely strain a population already battling

  • the economic fallout of Covid-19.

  • While the sanctions imposed by the West so far have been targeted, entities with links

  • to the Tatmadaw are active in many parts of Myanmar's economy,

  • which will have a spillover effect on the general population.

  • The inaction by Myanmar's neighbors also blunts the impact of any sanctions.

  • As Western businesses withdraw from the country, the void would be filled by regional backers

  • such as Thailand and China.

  • There are also fears that sanctions could push Myanmar closer to China

  • a situation that does not play well for other regional powers such as India and Japan.

  • If history is any indication, it is unlikely that the generals will buckle under the threat

  • of sanctions, even though the measures this time are more surgical than the previous ones.

  • However, after emerging from half a century of isolation in 2011,

  • Myanmar today is different after a decade of change.

  • Despite promises by the military junta that it will hold a "free and fair general election"

  • once the year-long state of emergency ends,

  • it is likely that opposition will continue to mount, not just internationally, but domestically too.

When policymakers want to respond to foreign challenges or influence a desired outcome,

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Do economic sanctions work? | CNBC Explains

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    Summer posted on 2021/03/31
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