4. Sanctions and countersanctions in EU-Russia relations

The lecture will be focused on reaching the following objectives:

• explain the concept of sanctions.
• provide an overview of the EU sanctions towards Russia and the changing dynamics of EU-Russia relations after the MH17 crash.
• examine Russia’s response to the EU sanctions.

To reach the learning objectives, students are required to watch the video lecture, read the study materials as well as to complete the fourth self-test.

In the previous lecture, we looked at the security dimension of the Crimean annexation. In this lecture, we will look at the economic side and implications of the Ukraine crisis, namely we will examine the issue of sanctions in EU-Russia relations and discuss how the crash of MH17 changed their scope. However, before discussing the effectiveness of sanctions in the context of the Ukraine crisis; we first have to define the concept of sanctions. 

 

Margaret Doxey defines economic sanctions as “penalties threatened or imposed as a declared consequence of the target’s failure to observe international standards or international obligations.” Economic sanctions can also be defined as “punitive actions initiated by a number of international actors, particularly a world organization such as the United Nations, against one or more states for violating a universally approved charter, as inducements to follow, or refrain from following, that particular course of conduct and conform with international law.”

 

It is important to point out that sanctions might be aimed at states, or individuals, who do not necessarily violated international law; but given the context of the Crimea crisis, we would adopt the definition of sanctions mentioned above. The sanctions are imposed for several purposes:

 

• to punish the target state (organization, individual)
• force change in the target’s policies 
• demonstrate to a domestic or international audience the sender’s position on the target’s policies.

There are four main methods of applying economic sanctions by the sender:

 

• trade controls
• suspension of aid or technical assistance
• freezing of the target’s financial assets
• blacklisting of companies involved with bilateral business

The EU introduced the sanctions in an attempt to change the Kremlin’s policy towards Ukraine. Initially, the first and second waves of sanctions, which lasted from March-July 2014, targeted individuals close to the Russian leadership, as well as key decision-makers, forbidding them to enter the U.S. and EU member states and freezing their assets in those countries. This type of sanctions soon appeared to be ineffective, convincing Western states, especially after the crash of MH17, which resulted in the death of nearly 300 people on board, including residents of many European countries such as the Netherlands, the United Kingdom, Belgium and Germany; to change their strategy by imposing more decisive and sectoral sanctions, which were first introduced in the 3rd wave and expanded in 4th and 5th waves. Sanctions ultimately target such sectors of the Russian economy as energy, banking, finance, defence and high tech’ (European Council).

 

Russia responded to the EU sanctions with its ‘food embargo’ on European agriculture products as well as travel bans related to certain officials of EU, USA and Canada. 

 

The video lecture helps to better understand the dynamics of EU’s sanctions and the level of their effectiveness as well as Russia’s rationale behind imposing counter sanctions. 

 

References:

• Doxey, M. (1980). Economic Sanctions and International Enforcement, 2nd ed. (New York: Oxford University Press), p. 9.
• Daoudi, M. S. and Dajani, M. S. (1983). Economic Sanctions: Ideal and Experience (Boston: Routledge & Kegan Paul), p. 8.
• European Council. EU restrictive measures in response to the crisis in Ukraine.

Reading materials:

1. Ian Bond, Christian Odendahl and Jennifer Rankin. Frozen: The politics and economics of sanctions against Russia. Center for European reforms. 2015.
2. Jonathan Masters. What are economic sanctions? Council of foreign relations backgrounders. April 2015.
3. Alexey Khlebnikov. Everything you need to know about Western sanctions against Russia. Russia direct. October 2014.
4. Eremenko A. 2015. Russia’s sanctions war against the West explained. NBC news.