Unintended Consequences: Debt, Corruption and the Effect of Western Sanctions Against Russia on Eurasia 
Mariya Omelicheva (National Defense University)
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Voesar Conference Room 412
Saturday 12 October, 9:00-10:45 (UTC+0)

Long Abstract

After Russia invaded Crimea in 2014 and then eastern Ukraine, the United States and the EU imposed sanctions on Moscow to deter further aggression and cajole Russia to comply with the Minsk ceasefire agreement. Since 2014, the United States has enacted 61 rounds of sanctions on Russia targeting over 230 individuals. The European Union has targeted their own growing list of Russian individuals and entities. Economic sanctions cover all forms of coercion that impact on the economy of the state and that are intended by the sender to bring about a certain result or to shape the behavior of the target state. Coercive measures include trade sanctions, boycotts, aid suspensions, freezing financial assets, and the manipulation of tariff rates. Research is generally pessimistic about sanctions as a form of coercion. A substantial literature exists investigating the variety of unintended consequences of sanctions for target countries, including the counterproductive punishment of large civilian populations (something "smart sanctions" were designed to avoid), the erosion of political rights, and the rise in local violence. This panel goes beyond examining the unintended consequences of sanctions on the target to examine consequences for Russia's Eurasian neighbors as a result of their interdependency on the same financial mechanisms and relationships that bind the participating countries to the target. The heavy burden of the sanctions are more understood on Russia's European trade and business partners. The burden is less understood for Russia's neighboring Eurasian states. Research reveals that sanctions are impacting financial and trade flows, political priorities, and foreign relations. Dr. Stacy Closson of American University researches the extent to which sanctions have shifted Russian foreign and security policy towards Eurasia, including China and Iran. Dr. Mariya Y. Omelicheva of National Defense University examines negative externalities of Russia's crisis (impacted by sanctions) in Central Asia in terms of both economic spillover and some political instability. Dr. Iikka Korhonen, Head of Research at the Bank of Finland uses confidential BIS data on bilateral capital flows to examine the level of investments to Russia from the countries that imposed sectoral sanctions in 2014 versus from those countries that did not impose sanctions, including Eurasia.

Accepted papers: