Types of Sanctions
Comprehensive sanctions are the most severe. It impacts the entire economy or the most significant industries within the targeted country. When the government uses comprehensive sanctions, they often hit the civilian population of the targeted country the hardest.
There are also Smart Sanctions, or targeted sanctions, which have more narrow scope and severity. Smart sanctions target specific individuals, companies, organizations or certain commodities. They freeze bank assets, and cause transactional bans, investment restrictions, travel bans, diplomatic constraints or sports restrictions.
Sanctions and Poverty Connection
The lack of a U.S. governmental study on the humanitarian impacts of sanctions means the public must establish the links between sanctions and poverty. In a nutshell, the use of sanctions impacts poverty by entrenching people in it.
There are several ways economic sanctions burden civilian populations living under targeted regimes. Sanctions increase the poverty gap and impact the poorest in that targeted country the hardest. Income inequality increases under sanctions and it harms civilian populations far more than the sanctioned leadership of the targeted country. The living standards and humanitarian situation in sanctioned countries decreased as the harm of sanctions wore on. Finally, if the U.S. government lifted sanctions, the cost of recovery and returning to economic growth would be high. Of course, the state must change its behavior first.
To better understand sanctions and poverty connection, it is essential to evaluate the intended aims and unintended consequences of using sanctions. Examining the usage of sanctions by the U.S. will demonstrate the nature of sanctions and their negative impact on poverty.
US Intended Aims of Economic Sanctions
U.S. sanction severity and intended goals vary over time and depend on several political-economic factors. The U.S. currently administers a couple of dozen sanction regimes. It would be unwieldy to analyze all of them. The connection between sanctions and poverty is apparent enough by examining an ongoing U.S. sanction regime on Venezuela. The U.S. implemented sanctions in 2017 and 2019, intending to pressure the Venezuelan President to resign due to his increased anti-democratic practices.
Unintended Consequences for Venezuela
Although the U.S. has no sanctions that explicitly prevent the import of food or medicine, comprehensive sanctions can do this implicitly. A sanction that embargoes trading oil with Venezuela effectively obstructs the flow of food and medicine because the Venezuelan economy is highly dependent on oil revenue. Additionally, there are no sanctions that explicitly affect water, but comprehensive sanctions can do this inadvertently. The 2019 U.S. sanctions on Venezuela led to situations in which Hidrocapital, Venezuela’s water agency for the capital city Caracas, cited having issues obtaining new parts they need to fix broken water pumps. Hidrocapital cites that 15%-20% of the Venezuelan population lacks access to clean drinking water in their homes because the sanctions make the Venezuelan government unable to get new parts. Evidently, comprehensive sanctions obstruct the free flow of humanitarian aid.
The connection between sanctions and poverty appears again as the comprehensive sanction regime worsened income inequality for the Venezuelan people. In 2019, approximately 90% of Venezuelan government revenue came from oil. The trade and financial restrictions on the state-owned oil company PDVSA devalued Venezuela’s currency. Wealthier Venezuelans with access to U.S. dollars lived lavishly, especially the targeted leadership. The majority of Venezuela’s population had two choices. Either emigrate for work as millions of other Venezuelans did or stay in the country holding multiple jobs and still not make enough money to live.
A More Humane Approach to Sanctions and Poverty
Economic sanctions are still an oft-used foreign policy tool. However, Congress has started including humanitarian carve-outs within these sanction regimes. For example, in the Congressional Research Service’s overview of U.S. sanctions on Venezuela, a humanitarian carve-out states the Office of Foreign Assets Control will license all transactions involving food, water, medicine, agricultural commodities, remittances, international organizations and communications services. If any of the authorized transactions undergo accidental obstruction, there are policies in place in which organizations delivering humanitarian aid facing barriers can report these barriers to OFAC.
The U.N. has also increasingly advocated better protecting civilians from how sanctions impact poverty. Martin Griffiths, the Under-Secretary-General for Humanitarian Affairs and Emergency Relief Coordinator for the U.N. made it clear that sanctions should never impede anyone’s right to enjoy socioeconomic and cultural rights, including food, water, shelter and health. Griffiths proposed that governments instead should have comprehensive humanitarian carve-outs as opposed to the case-by-case basis most countries are using. This would help protect civilian populations from poverty.
Communities and Organizations Make A Difference
Thanks to the combined efforts of the International Committee of the Red Cross and local communities, close to 2,400 people living in Pueblo de Dios and Sueño de Bolívar now have access to clean drinking water at their doorsteps. Before these efforts, people living in the area had to walk almost 40 minutes every day to get water.
The residents have benefited greatly from the work of these organizations. Marta Quiroz, a local who runs a community center that provides 257 people with meals every day, is one of many who benefited from this project. Marta Quiroz said that “Having easy access to water has helped us enormously. Before, we had pump water from a spillway, but sometimes it wouldn’t be enough…Now, every family has a tap at the entrance of their house, and we all get this great stream of water.” This is what the current santion regime can accomplish. It is undeniable that sanctions limit how much this humanitarian and developmental work can accomplish.
Specifically targeted sanctions, like smart sanctions, could ease the burden on civilian populations. A reevaluation of the negative impacts sanctions have on civilian populations would also ease the burden on these relief organizations. Fortunately, the U.N. and U.S. are beginning to account for the humanitarian impacts of sanctions, a step forward in ensuring that sanctions do not further increase global poverty.
– Chester Lankford
Photo: Wikipedia Commons