logo
Published on Cato's Center for Trade Policy Studies (http://www.freetrade.org)

Unilateral Sanctions

Using trade as a weapon of foreign policy has harmed America's economic interests in the world without advancing national security. The proliferation of trade sanctions in the 1990s has been accompanied by their declining effectiveness. From Cuba to Iran to Burma, sanctions have failed to achieve the goal of changing the behavior or the nature of target regimes. Sanctions have managed only to deprive American companies of investment opportunities and market share and to punish domestic consumers, while hurting the poor and most vulnerable in the target countries.

Since 1993, according to the president's Export Council, the United States has imposed more than 40 trade sanctions against about three dozen foreign countries. The council estimates that those sanctions have cost American exporters $15 billion to $19 billion in lost annual sales overseas, and caused long-term damage to U.S. companies--lost market share and reputations abroad as unreliable suppliers.

As well as inflicting economic damage, sanctions have been a foreign policy flop. A comprehensive study by the Institute for International Economics found that sanctions achieve their objectives in fewer than 20 percent of cases. For example, the Nuclear Proliferation Act of 1994 failed to deter India and Pakistan from testing nuclear weapons in May of 1998. Sanctions have utterly failed to change the nature or basic behavior of governments in Cuba, Burma, Iran, Nigeria, Yugoslavia, and a number of other target countries.

    Trade Policy Analysis
    Trade Briefing Papers
    Speeches and Testimony
    Free Trade Bulletins
    Books:
    From the Cato Handbook for Congress:
    Commentary
Source URL:
http://www.freetrade.org/issues/sanctions.html