Economic Warfare: The Humanitarian Impact of U.S. Sanctions on Iran

A trending hashtag on Twitter and Instagram. A viral video of a sick child without access to medical care. A chilling prophecy from the UN Human Rights Council. This is how U.S. sanctions are hurting regular Iranians. 

Following recent acts of alleged Iranian aggression, the Trump administration has felt  pressured to tighten its grip on Iran’s economy. Though not an outright act of war, U.S. sanctions on Iran are stifling the growth of a rising middle class, stopping people at the border, and blocking humanitarian imports of food and medicine. 

While major news headlines tend to capture the animosity between U.S. and Iranian leaders, they fail to comprehend the humanitarian impact of sanctions on Iranian citizens. 

What are economic sanctions and how do they work? 

Economic sanctions have traditionally been used as an extra-diplomatic tool to pressure state and nonstate actors to give in to certain demands or comply with international norms of behavior. While proponents of economic sanctions argue that they are an effective foreign policy tool, especially in the age of globalization and integrated markets, critics say that they do more harm than good — particularly to international markets. The United States, which uses economic and financial sanctions more than any other country, currently has more than two dozen sanctions regimes in effect, targeting countries such as Russia, Venezuela, Syria, Cuba, and, of course, Iran. 

Sanctions can be comprehensive, meaning they prohibit commercial activity on a country-wide scale, or they can be targeted to particular groups, people, or businesses, also known as “smart sanctions”. In the last two decades since 9/11, there has been a marked shift towards the use of smart sanctions to minimize the suffering of innocent people. A third category of sanctions includes extraterritorial sanctions (sometimes called secondary sanctions), which are designed to prohibit the governments, people, and businesses of third party countries from doing business with a sanctioned country. 

The Trump administration’s “maximum pressure” strategy is a three-pronged approach which aims to push Iran to the negotiating table using economic, diplomatic, and military pressure.  Similar to a general strike, which aims to upset the daily lives of ordinary people to inspire change, sanctions tend to rattle unassuming citizens more than the political regime they are intended to punish. 

What are the current U.S. sanctions on Iran?

Currently, the United States is engaged in a campaign to assert maximum financial pressure on the Iranian government. On November 5th, 2018, the Trump administration left the Joint Comprehensive Plan of Action (JCPOA), known colloquially as the Iran nuclear deal. The JCPOA, which was negotiated by the P5+1 (the U.S., China, Russia, France, the U.K., and Germany) imposed restrictions on Iran’s civilian nuclear enrichment program in exchange for relief from international economic sanctions.  

Following their exit, the U.S. imposed the “toughest U.S. sanctions ever imposed on Iran” , targeting the largest—and arguably the most critical—sectors of Iran’s economy: energy, shipbuilding, shipping, and finance. In the largest single-day action targeting the Iranian regime in U.S. history, the administration sanctioned more than 700 individuals, entities, aircraft, and vessels, and added all individuals identified as the “government of Iran” or an “Iranian financial institution” to the Specially Designated Nationals (SDN) and Blocked Persons list, which blocks their assets and prohibits U.S. individuals and businesses from doing business with them. 

How are these specific sanctions affecting Iranian citizens? 

According to the journal Foreign Policy, American sanctions are hurting Iran’s economy, which indirectly harms Iranian citizens. Workers are suffering from an unemployment rate of 15%. Since the sanctions were imposed, the national currency, the rial, declined by 60% this year, inflation has surpassed 40 percent, and the overall economy has contracted by over 9.5%, according to a recent report by the IMF. Since the Trump administration pulled out of the Iran nuclear deal, oil exports have fallen from 2.5 million barrels of crude oil a day to less than 200,000 a day. 

The sanctions are also directly targeting an unexpected (and unexpecting) demographic: Iranian students traveling to the U.S. to further their education abroad. At least a dozen Iranian graduate students planning on studying engineering and computer science in the U.S. had their visas abruptly revoked this month, according to the New York Times. The sudden action on behalf of the State Department, which is responsible for issuing, altering, and revoking Visas, is reminiscent of a 2012 law that denied Visas to students planning on working in the energy or nuclear sectors in their home country. While the law, which was signed into effect under President Barack Obama, has been loosely interpreted in the past few years, the State Department appears to have cracked down in light of the recent escalation of Iran-U.S. tensions. 

Additionally, extraterritorial sanctions placed by the U.S. on foreign countries with banks involved in the Middle East are limiting Iranian access to drugs, healthcare services, treatments, and necessary medical care. As banks and pharmaceutical companies fear the repercussions of trading with Iran, ordinary Iranians are forced to stockpile, seek other alternatives, or simply go without. The hashtag #SanctionsTargetMe has become a popular way for Iranians on Twitter and Instagram to protest what many see as a violation of the fundamental human right to health care. 

The humanitarian crisis caused by U.S. sanctions in Iran is so dire that U.N. Special Rapporteur on the Negative Impact of Unilateral Coercive Measures on the Enjoyment of Human Rights, Idriss Jazairy, said in a public statement that “[t]hese unjust and harmful sanctions are destroying the economy and currency of Iran, driving millions of people into poverty and making imported goods unaffordable”, adding that the sanctions are causing “a ‘chilling effect’ which is likely to lead to silent deaths in hospitals as medicines run out, while the international media fail to notice”. 

Why is this a human security issue?

As tensions escalate between the U.S. and Iran, so does the threat of open conflict between two nuclear powers. Recently, the capture of a British tanker in the Strait of Hormuz, the attack on a U.S.-manned drone over international airspace, and the bombing of a Saudi Arabian oil facility has fanned fears about the possibility of a U.S. military intervention in the region. Since the United States pulled out of the JCPOA last May, Iran has been focused on restarting its nuclear power program, announcing publicly that it will increase its Uranium production incrementally every 60 days. While the Trump administration claims to have withdrawn from the nuclear deal because of its incompetence, the lack of any agreement at all leaves the two countries in an even more precarious situation.

Policy Recommendation

Economic sanctions are a serious instrument of foreign policy and should only be pursued with the utmost caution and care. Before the economic crisis worsens in Iran, the U.S. should reconsider its maximum pressure campaign by combining punitive measures, such as sanctions and the threat of military action, with positive inducements, such as financial aid. Humanitarian exceptions for food, aid, and medicine should be included as part of any comprehensive sanctions. According to a resolution adopted by the Human Rights Council in September 2014, unilateral coercive measures and legislation are contrary to international law, international humanitarian law, the Charter and the norms and principles governing peaceful relations among States. Thus, sanctions should have multilateral support from national governments and international organizations alike.

The Trump administration should also carefully consider its foreign policy objectives in the region, considering that sanctions can have the perverse effect of bolstering authoritarian, statist societies by creating scarcity and enabling governments to better control the distribution of goods. Often, even unpopular ruling elites can protect themselves and their supporters by shifting the economic burden of sanctions onto opponents or disenfranchised groups. 

Featured Image Source: Foreign Policy