The sanctions against Iran in 2012 and against Russia in 2014 are permanent. This is the result of a simulation by a German research team. As a result, both exports and imports have declined.
Russian exports have fallen by 36 percent, while imports have fallen by more than 30 percent. The Kiel Institute for the World Economy (ifW) announced this on Friday. For Iran, the decline was even more pronounced with 41 percent in exports and 83 percent in imports. Since the introduction of the sanctions, there has been a loss of prosperity in both countries. This is slightly higher in Iran than in Russia (1.7 percent vs. 1.5 percent).
coalitions important
Another conclusion of the ifW and the German Institute for Economic Research (DIW) is that coalitions are important when it comes to sanctions. You increase the economic costs for the target country and reduce your own costs. A smaller group of sanctioned countries has achieved about 60 percent of the effect a global sanctions coalition would have had in both Iran and Russia.
China, Vietnam, Belarus, Turkey and South Korea contributed particularly effectively to sanctions against Russia. The sanctions against Iran have gained strength from China, the United Arab Emirates, India, Singapore and Brazil in particular.
Improved prospects for Russia
As for Russia, according to the central bank, the economy there will shrink less than forecast in 2022, despite new sanctions. The fall in gross domestic product (GDP) will be 3 to 3.5 percent this year. The Russian economy is expected to grow again in the second half of 2023.
Source: Krone
I’m Wayne Wickman, a professional journalist and author for Today Times Live. My specialty is covering global news and current events, offering readers a unique perspective on the world’s most pressing issues. I’m passionate about storytelling and helping people stay informed on the goings-on of our planet.
