President Biden announced on Tuesday that the United States will impose new sanctions on Moscow after Russian President Vladimir Putin ordered troops into two Ukrainian territories on which the Kremlin has laid claim for years.
“This is the beginning of a Russian invasion of Ukraine,” Biden said in an address from the East Room of the White House.
Biden’s remarks came a day after Putin ordered troops into Donetsk and Luhansk under the guise of “peacekeeping,” even as the Russian president made clear that he did not accept the basic premise of Ukrainian sovereignty.
“Who in the Lord’s name does Putin think gives him the right to declare new so-called countries on territory that belongs to his neighbors?” Biden said. “This is a flagrant violation of international law.”
So What are sanctions and how do they work?
What is a sanction?
A sanction is a penalty imposed on another country or on individuals who are citizens of another country. It is an international policy and economic pressure weapon that may be defined as a carrot-and-stick technique to dealing with global trade and politics.
Why do countries use sanctions?
“You can impose sanctions against another state because you want to see a change in behavior of the other state,” says Professor Moritz Pieper, a lecturer in international relations at the University of Salford.
The idea is that “the population gets angry, and will demand from its own government to do something to rectify the situation.”
Countries can also introduce sanctions in retaliation to other countries’ sanctions.
For example, Russia did this in 2014 in response to restrictions put on them by the EU and USA.
What different types of sanctions are there?
- Embargoes – A trade embargo is a broad ban on trading with a country, though it can sometime include exceptions for the supply of food and medicines on humanitarian grounds. Cuba, Iran and North Korea have long been subject to U.S. trade embargoes.
- Export controls – Export restrictions bar the supply of specified products, services and intellectual property to targeted countries. They often restrict sales of weapons, technology with military applications or, as currently for Russia, oil drilling technologies and equipment.
- Capital controls – Capital controls can restrict investment in targeted countries or industries, or broadly bar access to international capital markets for a country’s issuers.7
- Trade sanctions – Trade sanctions can include import controls for specific countries, regions or industries.
- Asset freezes or seizures – Assets within sanctioning jurisdictions can be seized or frozen, preventing their sale or withdrawal
- Travel restrictions – Officials and private citizens as well as immediate family members may be denied travel access to sanctioning jurisdictions.
What are ‘smart sanctions’?
Sanctions can be quite a blunt instrument if they are a blanket ban on something, and can have unintended consequences.
But “smart sanctions” are sometimes used – they’re much more targeted and designed to only punish a small number of people rather than an entire nation.
For example, people close to Syrian President Bashar al-Assad – including his wife Asma – have had their assets frozen over the government’s violent response to the Syrian uprising.
What sanctions the U.S. has imposed so far
President Joe Biden announced a raft of new sanctions against Russia he said would cut off its government from Western financing and punish elites who benefit from the Kremlin’s corrupt policies, after President Vladimir Putin ordered troops to move into the breakaway Luhansk and Donetsk regions of eastern Ukraine.
“These have been closely coordinated with our allies and partners, and we’ll continue to escalate sanctions if Russia escalates,” Biden said in remarks from the White House Tuesday afternoon, calling Putin’s moves “the beginning of a Russian invasion of Ukraine.”
The latest package would issue sanctions on two major Russian banks and on the country’s sovereign debt, meaning it can no longer raise money from the West and trade new debt on U.S. or European markets, the president said. Starting tomorrow, the U.S. will also impose sanctions on Russian elites and their family members, he added.
Biden called the moves “the first tranche” of punitive measures the U.S. is prepared to take, and he said they would go far beyond the steps the U.S. and its allies took in response to Russia’s invasion of Crimea in 2014.