Why all sanctions regimes, including Iran, should include ‘humanitarian harm’ assessments

When policymakers think about the humanitarian impacts of sanctions, they tend to focus on the specific questions of whether they constrict trade in food and medicine or hinder humanitarian assistance to vulnerable communities. Policymakers seek to protect these activities by creating exemptions and granting licences to make clear that companies are permitted to sell essential goods to buyers in sanctioned countries, and that non-governmental organisations can carry out their work in line with international humanitarian law, even if sanctioned entities, including government actors, are involved. So long as humanitarian trade and assistance continues in some form, policymakers are generally satisfied that humanitarian harms have been mitigated.

But the experience of Iran under sanctions suggests that a broader definition of ‘humanitarian impacts’ is needed to reflect the true harms of sanctions on ordinary people. Defining the humanitarian harms of sanctions is an urgent task when considering that “more than 800 million people live in countries under a U.S. sanctions program or that have a major national-level political group sanctioned—12% of the population of the developing world,” as cited in Noema Magazine. The matter is made all the more urgent given that many of the world’s broadest sanctions regimes are now imposed on countries already suffering from acute or prolonged humanitarian crises, such as those against targets in Syria, Venezuela, North Korea, Cuba and Afghanistan.

Sanctions – particularly those that target finance and other economically-important sectors – are designed to cause significant economic pain in order to pressure an uncooperative government to change its behaviour and to raise costs of actions found to be in breach of international norms. But any sanctions programme that causes significant contraction to a country’s economy will also have an impact on ordinary people. Our research has found that major sanctions programmes often induce high rates of inflation in the target country, both by creating pressure on the national currency and government budgets, but also by interrupting the normal functioning of supply chains, including those dealing in exempted goods, such as medicines, medical devices, vaccines, food and agricultural products.

As prices for even basic goods – such as food and medicine – rise, household welfare is diminished. In the most serious cases, families can be plunged into hunger and individuals with serious medical conditions may no longer be able to afford vital medication. In countries like Iran, food and medicine remain available, giving the impression that sanctions are not having acute humanitarian impacts. But that does not mean that food and medicine remain affordable, particularly as real incomes fall, purchasing power decreases, and millions of households fall below the poverty line. Within the broader picture of diminished social welfare, vulnerable groups, including women, children, the elderly and refugees, are least able to shield themselves from the economic fallout.

Systemic impacts, such as pressure on a country’s healthcare system and the effect of budgetary constraints on infrastructure investments essential for development, should also be considered as part of humanitarian harms. Policymakers are likely to balk at the suggestion that the humane use of sanctions would require limiting these kinds of systemic impacts—as the purpose of sanctions is often to hamper economic development and to deny states resources to engage in problematic activities, such as the funding of weapons programmes or the financing of terrorism.

But when sanctions are imposed on a target country for many years—Iran has now spent nearly a decade under major US secondary sanctions—the cumulative impact on public services and critical infrastructure can lead to unique vulnerabilities. This matters because states serve multiple functions. Aside from funding its own defence, the state is also responsible for the maintenance of public services and the welfare system. Therefore, even if the intended aim of sanctions is to weaken the target government, there are unavoidable impacts on the ability of state institutions to deliver public goods, such as healthcare, or support vital activities, such as agriculture, that form the foundations for social welfare and resilience in the country. This makes the country more vulnerable to crises. In Iran, sanctions complicated the response to the COVID-19 pandemic. The country has also faced challenges accessing vaccines and related goods to address the virus. Iran’s response to other, slower-moving crises, has also been hampered. For example, alongside government mismanagement, sanctions have compromised Iran’s ability to deal with its acute water crisis by preventing the acquisition of key technologies.

An added problem is that of financial sector de-risking and wider private sector over-compliance with sanctions, leading to financial exclusion and difficulties accessing essential goods and services. As our research has shown, many banks now have complete blanket bans on servicing any types of trade to Iran, including exempted goods. In turn, many companies dealing in vital goods – be it in technology, shipping or insurance – have also withdrawn from Iran, alongside other ‘high-risk’ jurisdictions. This is due to the serious, and growing, hurdles characterised by the risk of billion-dollar fines, cumbersome compliance requirements and reputational risks.

Overall, the impact of sanctions on government budgets or investment attraction cannot be considered a humanitarian harm in the short run, particularly in cases where hard-hitting sanctions are imposed for short durations; however, in the long run, they do begin to impinge on the wellbeing of ordinary people, as these impacts prevent the maintenance of a certain level of welfare support by the state. This highlights the urgent need for humanitarian and public health specialists to form part of any sanctions planning process, and for their design to account for long-term economic damage.

For now, US and European policymakers are unlikely to radically alter their approach towards the humanitarian harms of sanctions. As the focus falls on tightening the sanctions vice grip on Russia, humanitarian concerns risk falling by the wayside. But starting to understand the humanitarian harms of sanctions in more holistic terms means giving voice to millions of people living in Iran and other sanctioned jurisdictions, whose lives have been dramatically changed by economic measures imposed from afar.