U.S. Sanctions, Peacemaking and Reform

 Published September 2023

Statecraft in the 20th century periodically featured economic coercion, but the use of economic sanctions accelerated after the Cold War ended. In recent decades, they have emerged as a key instrument of U.S. foreign policy – and a main component of Washington’s responses to crises and conflicts.

Click on a dot to jump to a key moment in sanctions history or click on the orange arrows below to navigate in time from 1945 to the present. 

Restricting resources

Washington uses sanctions to restrict the access of belligerents and other dangerous actors to weapons, money and other resources. For example, sanctions have been a key part of U.S. efforts to deprive al-Qaeda of money and resources. The 9/11 hijackers had used bank accounts in their own names to finance the attacks, and policymakers sought to prevent a future actor from doing the same.

Washington’s sanctions in response to the Ukraine crisis explicitly aim to constrain Moscow’s resources for fighting the war in Ukraine, among other goals. U.S. officials note that sanctions restrict access to advanced technologies, compromising Russia’s ability to modernise its military and degrading its fighting capability.

Addressing abuses

U.S. policymakers use sanctions to confront corruption and serious human rights abuses. They often have the overlapping goals of punishing abusers, signalling that their behaviour is transgressive and deterring them and others from committing additional crimes. In the absence of other means for bringing such “bad actors” to justice, they see sanctions as “vehicles of accountability”.

Officials and civil society actors also see using sanctions as a way to champion journalists, human rights defenders and others who have risked their lives to shed light on abuses.

Raising the cost of destablising behaviour

U.S. officials use sanctions to signal their priorities in crisis settings and heighten the consequences for those who oppose them.

They impose sanctions to complement diplomacy and other measures by creating a consequence that is intended to affect the calculations of foreign actors engaged (or potentially engaged) in behaviour that Washington wishes to discourage.

Pushing negotiations forward

U.S. officials use sanctions to nudge parties in conflict toward negotiations and to keep talks that are already under way on track. They levy them as part of efforts to create momentum toward negotiations, or in existing ones, counting on the idea that the reward of sanctions lifting will be an incentive to the parties.

Diplomats involved in putting together the Iran nuclear deal said sanctions helped get Iran to the table. According to them, sanctions encouraged Iran to join the negotiations, remain in the talks and make concessions.

While sanctions have found favour as a tool that allows the U.S. government to pursue policy objectives in conflict settings without the blood and treasure required for military campaigns, these tools are not cost-free. Some of the downsides manifest themselves as impediments to peacemaking priorities, including Washington’s own. 

Inhibiting post-conflict recovery and peace process implementation

Even though the Revolutionary Armed Forces of Colombia (FARC) signed a peace deal with the Colombian authorities in 2016, the group remained designated as a Foreign Terrorist Organization until 2021. Sanctions made it harder for former rebels to integrate into society as had been envisioned by the 2016 peace deal.

Some former fighters said sanctions posed less of a problem for them during their decades-long guerrilla campaign than after they demobilised. As a former fighter put it, “We weren’t affected [by sanctions] in the war, but we were affected in peace”.

For example, after the peace deal, 1,500 of the 13,000 demobilised FARC fighters signed up to remove mines they had planted during the war. But they did not receive the landmine removal training or the certificates required for them to begin, due to concerns that providing these would violate U.S. laws. Former combatants told Crisis Group that certification delays pushed several of their peers to leave demining projects, lose hope in the peace process and rejoin armed groups. Landmine removal stalled.

Sanctions can also impede efforts to encourage private-sector investment in post-conflict situations. Investors often lack the confidence to enter markets where sanctions exist or where sanctions were recently lifted in part or in full.

In these settings, said a former U.S. official, sanctions “hang over the country like a black cloud”.

U.S. sanctions affected the calculations of many companies that were active in Afghanistan before the Taliban takeover. They pulled out of the country despite the general licences published by the U.S. permitting extensive private-sector transactions as part of efforts to stave off state collapse.

Undercutting negotiations

Sanctions can only help bring parties to the table, and provide leverage when they get there, if negotiators can credibly promise meaningful and enduring sanctions relief. But too often, U.S. negotiators cannot persuade the parties that such pledges are within their purview – and, indeed, they rarely are.

Take the case of Iran. Tehran was reluctant to re-enter the 2015 nuclear deal after the U.S. reneged on its promises of sanctions relief three years later. Iranian negotiators feared that the benefits of any deal involving sanctions relief would be short-lived, given the risk that a future president might exit an agreement once again.

Sudan offers another example. In 2016, the Obama administration used the promise of sanctions relief to motivate Sudan to cooperate on counter-terrorism, humanitarian access, and other topics. While Khartoum appeared to satisfy most of the conditions that were set for it, Washington slow-rolled the sanctions relief that was supposed to be Khartoum’s reward, and Sudanese officials accused U.S. diplomats of backtracking on their commitments. While the Trump administration eventually lifted some sanctions in 2017, a State Sponsor of Terrorism designation lingered until 2020. It remained even after enormous protests in 2019 led to the ouster of President Omar al-Bashir, whose actions had motivated many of the sanctions in the first place. 

Entrenching divisions

U.S. sanctions also sometimes reinforce tensions with targeted groups, individuals and countries in a way that is difficult to reverse even when the circumstances underlying the sanctions have changed.

For example, sanctions can complicate U.S. diplomatic outreach to sanctions targets because they end up shaping policy decisions on whether to engage in such outreach.

At the furthest end of the spectrum, sanctions – especially terrorism sanctions – can even go so far as to help cement rationales for the use of force although, legally, sanctions are unrelated to force authorisations.

The designation of Iran’s Revolutionary Guard Corps as a Foreign Terrorist Organization by the Trump administration may have played a subtle role in the strike on the Iranian general Qassem Soleimani by conditioning the national security bureaucracy to think of Corps members in the same light as ISIS and al-Qaeda, both Foreign Terrorist Organizations, and ultimately to use the same tools to counter them.

1. They are hard to change

U.S. sanctions are sticky: they are hard to change, ease or lift because of domestic politics and bureaucratic inertia. The stickiness poses challenges for peacemaking, as officials struggle to use sanctions as effective leverage in peace negotiations and find peace-related policy goals difficult to achieve when sanctions backfire or outlive the circumstances that prompted them.

2. There is no system for comprehensive evaluation

Washington has no system for comprehensively assessing sanctions’ costs or effectiveness – and thus the U.S. cannot gauge whether they are helping or hurting efforts to achieve the peace and security goals in whose name they were imposed. 

3. They are increasingly complex

The U.S. sanctions policy infrastructure has ballooned, as have the legal mechanisms that underpin it. Today’s sanctions are so numerous, grounded in so many different legal authorities, and overseen by so many different parts of the U.S. government that they are hard to understand, untangle, rescind or reform. 

Various government bodies are responsible for conceptualising, implementing or enforcing sanctions.

Serious measures to modify the way sanctions are used will be needed in order to put this powerful tool to best use in the service of peace and security.

The U.S. government could:

1.    Clarify which foreign policy objectives sanctions are intended to achieve, what behaviour prompted the sanctions, and what sanctioned parties can do to be removed from the sanctions lists;
2.    Review sanctions’ performance, including their impact on peacemaking, and recalibrate them as needed; 
3.    Codify sanctions carveouts in legislation so that peacemaking activities are permanently allowed;
4.    Better address private-sector reluctance to do business in sanctioned or previously sanctioned countries.
 

Change is possible, but it will require a concerted commitment to reform. U.S. policymakers have already shown an important interest in reforming sanctions to make them more effective and to better manage their collateral effects. But much more needs to be done. Serious measures to modify the way sanctions are assessed, calibrated and removed – and their after-effects addressed – will be needed in order to put this powerful tool to best use in the service of peace and security.

For an in-depth look into the issues addressed above, see Crisis Group’s report, Sanctions, Peacemaking and Reform: Recommendations for U.S. Policymakers. The report is a product of more than three years of research in Ankara, Bogotá, Brussels, Caracas, Dubai, Geneva, Harare, Idlib, Istanbul, Kabul, Kinshasa, London, Mogadishu, New York, Tripoli, Tunis, Washington and elsewhere. It draws on hundreds of interviews with current and former U.S. officials, diplomats, practitioners, experts, civil society representatives, conflict parties, lawyers and financial service providers, as well as Crisis Group’s body of previous work on sanctions in conflict settings.