CiR2P Option 28 | Apply economic sanctions

DISCUSSION:

Economic sanctions include trade restrictions – refusal to export (embargos) and or refusal to import (boycotts) – covert refusals to trade (blacklisting), deprivation of ownership (expropriation), punitive taxation, aid suspensions, and asset freezes.

Economic sanctions can be comprehensive such as an embargo applied to an entire country, or they can be targeted such as blocking financial transactions with a particular business, group or individual.

The aim is to alter the strategies and policies of the target country and have been used to elicit change on a range of topics of international concern including terrorism, narcotics, proliferation, human rights, conflict resolution, and cybersecurity.

Different forms of economic sanctions have been applied to climate-related activities such as on the energy sector including oil, gas and coal and related equipment and technology; the production and import of iron, steel, and other metals; and other critical infrastructure and industrial machinery. Western powers have a strong history of applying economic sanctions to fossil fuel products. For example:

Since the 1980s, the US has applied comprehensive economic sanctions on the National Iranian Oil Company and associated oil-sector activities (eg investment, shipping, insurance, and exports). Oil-sector sanctions have also been targeting Libya’s national oil company, which had a considerable impact on the Libyan economy. Since 2014, targeted economic sanctions have been applied to Russian oil companies and activities (eg accessing debt finance, and oil exploration technology). In 2019, the US backlisted Venezuela’s national oil company, Petróleos de Venezuela, eliminating oil trade between the US and Venezuela. US economic and financial sanctions originate from the executive or legislative branch – typically the President will issue an Executive Order to start the process.

The EU has applied trade measures (embargos) and financial measures (bans on bank loans) to limit export and investment in North Korea oil, and of certain equipment and technology to Russian oil companies. In 2012, the EU applied banned the importation of Iranian oil. And has banned oil imports to the EU from Syria. The EU can impose economic sanctions as part of its Common Foreign and Security Policy, EU sanctions must be agreed unanimously members. And have been applied to both individuals and countries. Individual EU countries can also impose sanctions independent within their national jurisdiction. In 2020, appalled by forest loss and wildfires in the Amazon, eight European countries threatened Brazil with a trade boycott.

Western governments could explore options to apply targeted economic sanctions on a variety of industrial activities that cause climate change (and that ultimately threaten international peace and security).