Economic Sanctions: Precursor to Negotiation or Tribulation

Profile of the Author: Dheerja is a 4th-year B.Com LL.B (Hons.) student of University Institute of Legal Studies, Panjab University, Chandigarh. She has a keen interest in the Constitution, Economics of Law, and Minority Rights.

Introduction

The inevitability of law is its dynamism. The Second World War emphasized the atrocities of contemporary war and its indiscriminate effect on mankind. In response to the inevitable problem of war with prospects of advancement in nuclear technology, sanctions were introduced under International Law to induce or compel a State to disengage in acts of violence. Economic sanctions as one such measure originated in 432 BC when the Greek statesman and general Pericles issued the ‘Megarian Decree’ in regards to the abduction of three Aspaisan women, [1] nevertheless, emerged into mainstream politics Post-Cold-War.

The first economic sanction was imposed by the Security Council against Rhodesia in 1966. Since then, the economic sanctions are a prevailing norm axiomatic in the fact that the United Nation (UN) resorted to sanctions 26 times, the European Union 48 times, whereas, the African Union only 11 times. [2] Lately, the United States (US) has aggressively employed economic sanctions [3] as a normal foreign policy instrument intending to change the regime or policy in contrast to the objective ‘To maintain or restore international peace and security’ provided under Article 39 of the UN Charter.

It is in this backdrop of abuse of sanctions that the “Impact of economic sanctions is reconsidered through the prism of Article 2(4) of the UN’s Charter”.

Adverse Impact of Economic Sanctions: Disregarded History Lessons

According to Hafner-Burton Research, 2014, economic sanctions theory claims that ‘Economic pressure on civilians translates into pressure on the government for policy change’. Contrarily, the sanctions have failed miserably and selectively affected the minority and underprivileged sections of the society. A prominent instance is when UNSC imposed sanctions on Iraq post the Persian Gulf War, 1991. The comprehensive sanctions crumbled down the entire infrastructure of Iraq.

It drastically declined the importation of food which resulted in the consumption of buffer stock.[4] Eventually, the price of food surged 25 times, hence, violation of Right to Food recognised under Article 25 of UDHR and Article 11 of ICESCR.[5] Similarly, the extensive economic sanctions in North-Korea have allegedly led people to resort to cannibalism due to famine.[6]

The US has been on the edge with Iran since the Iranian Revolution of 1979 when the Western-friendly Shah of Iran was deposed in favour of a theocratic government. The ensuing events led to the endless sanctions by the US that have resulted in a deplorable state of Iran. In 2018, the US reinstated unilateral economic sanctions on the energy and financial sector in Iran pursuant to its withdrawal from the Nuclear Deal which consequentially led to a contraction of Iran’s GDP by 4.5%. [7] Subsequently, the plummeting oil sales contributed to a significant decrease in Iran's foreign exchange. The IMF estimated that Iran's reserves of foreign currency have been reduced to $86 billion that is 20% below their level in 2013. [8] The efforts to curtail the exponential rise in inflation in 2017 were futile as the IMF indicates an increase in inflation to 30.5% in 2018 which was predominantly higher for food items like 116% for meat products, thus affecting the poor population disproportionally.[9] In March 2020, the US further imposed sanctions on Iran to which the Covid-19 Pandemic acted as a cherry on top of the cake. The sanctions imposed deprived Iran’s government to liberally import essential goods, ventilators, masks, or personal protective equipment.

This violates the Right to Health as recognised under Article 25 of UDHR, Article 12 of ICESCR [10], and Article 17 of the Beijing Conference, 1995.

In light of the aforementioned instances, it becomes challenging to defend the imposition of sanctions as they endanger the very existence of the individual and their human rights.

The legitimacy of Economic Sanctions: Entangled in International Law

The economic sanctions derive their power from Chapter VII - Article 39 and 41 of the UN Charter which stipulates that the Security Council may decide measures involving force that extend to partial or complete interruption of economic relations. Conversely, the use of force is prohibited under Article 2(4) of the UN Charter which when read together with Article 25 asserts that the powers of the UN Security Council need to be exercised in conformity with the principles of the UN. It is apodictic in the Vienna Declaration and Programme of Action, 1999, that prescribes ‘States to refrain from any unilateral measures… that create obstacles to trade relations among states and impedes the full realization of the human rights set forth in the UDHR’. [11] Moreover, the UN Charter takes precedence over the Security Council as provided under Article 103 of the Charter, thus, as discerned earlier any sanction that is equivalent to collective punishment and causes widespread death and suffering is contrary to Article 24 of the Charter, therefore, ultra vires. [12]

UN Special Rapporteur, Idriss Jazairy also poignantly remarked that ‘Regime change through economic measures likely to lead to the denial of basic human rights has never been an accepted practice of international relations’. [13]

Further, the judgment of the International Court of Justice (ICJ) in Iran v. United States, 2018, is a way forward in establishing a greater obligation on the United States for the extraterritorial effects of its unilateral sanctions. [14] Correspondingly, the Draft Articles on Responsibility of States for Internationally Wrongful Acts adopted by the International Law Commission in 2001 under Article 50(1)(b) provide that the adoption of countermeasures by states shall not affect ‘Obligations for the protection of fundamental human rights’. [15]

The UN General Assembly, 2018 also adopted its 27th resolution condemning the embargo against Cuba (A/RES/73/8) on ‘Necessity of ending the economic, commercial, and financial embargo imposed by the US against Cuba’ [16] is a restatement of the law on unilateral sanctions. Lastly, the Asian-African Legal Consultative Organisation suggests that unilateral coercive economic measures constitute extraterritorial sanctions, therefore, violate international law.

Conclusion

Economic sanctions, though permissible by the UN Charter, are not devoid of judicial scrutiny and review. The necessity and proportionality test should be enforced to ensure the benchmark legality of any sanction to conform to the spirit of the UN Charter.

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FAQs

Q. What is the most historic instance of economic sanction?

Ans. The very first case of sanctions as we now know them occurred some 2,400 years ago (in 432 BC), when ancient Athens declared a trade embargo on neighbouring Megara, essentially strangling the city’s economy. After that, sanctions were used sparingly until the 20th century.

References

[1] Kenneth Rogoff, ‘Economic sanctions have a long and chequered history’ (The Guardian 5 January 2015) <https://www.theguardian.com/business/2015/jan/05/economic-sanctions-long-history-mixed-success> accessed 13th August 2020.

[2] Jana Ilieva, Dashtevski, & Filip Kokotovic, ‘Economic Sanctions in International Law’ (UTMS Journal of Economics 29 March 2018) <http://www.utmsjoe.mk/files/Vol.%209%20No.%202/UTMSJOE-2018-0902-09-Ilieva-Dashtevski-Kokotovic.pdf> accessed 13th August 2020.

[3] Jonathan Masters, ‘What Are Economic Sanctions?’ (Council on Foreign Relations 12 August 2019) <https://www.cfr.org/backgrounder/what-are-economic-sanctions> accessed 13th August 2020.

[4] Seyed M.H. & Razavi Fateme, ‘Economic Sanctions and Protection of Fundamental Human Rights: A Review of the ICJ's Ruling on Alleged Violations of the Iran-U.S. Treaty of Amity’ (Washington International Law Journal 7 April 2020) <https://digitalcommons.law.uw.edu/cgi/viewcontent.cgi?article=1833&context=wilj> accessed 13th August 2020.

[5] International Covenant on Economic, Social, and Cultural Rights, ‘Articles 11 & 12’ <https://www.ohchr.org/en/professionalinterest/pages/cescr.aspx> accessed 13th August 2020.

[6] Simon Jenkins, ‘Cuba has shown us that sanctions don’t work – so why keep using them?’ (The Guardian 15 April 2015) <https://www.theguardian.com/commentisfree/2015/apr/15/cuba-sanctions-dont-work-iran-russia-default-western-diplomacy> accessed 13th August 2020.

[7] BBC Editor, ‘Six charts that show how hard US sanctions have hit Iran’ (BBC 9 December 2019) <https://www.bbc.com/news/world-middle-east-48119109> accessed 13th August 2020.

[8] Ibid.

[9] Ibid.

[10] Supra Note 5.

[11] United Nation Human Rights Office of the High Commissioner, Vienna Declaration and Programme of Action adopted by the World Conference on Human Rights in Vienna on 25 June 1993 <https://www.ohchr.org/EN/ProfessionalInterest/Pages/Vienna.aspx> accessed 14th August 2020.

[12] Margaret Flowers, ‘Unilateral Sanctions and International Law’ (Sanctionskill 12 December 2019) <https://sanctionskill.org/2019/12/12/unilateral-sanctions-and-international-law/> accessed 14th August 2020.

[13] United Nation Human Rights Office of the High Commissioner, ‘US sanctions violate human rights and international code of conduct, UN expert says’ (OCHCR 6 May 2019) <https://www.ohchr.org/EN/NewsEvents/Pages/DisplayNews.aspx?NewsID=24566&LangID=E> accessed 14th August 2020.

[14] Supra Note 4.

[15] Ibid.

[16] Ibid.