Analysing international policy processes and Lithuania’s role in them
Events Jun 06, 2024

Discussion “Sanctions Against Russia: Efficacy and Future Implications”

On June 6, the EESC organised a discussion with Daniel Fried, the former US ambassador to Poland and a current Distinguished Fellow at the Atlantic Council. The discussion was titled “Sanctions Against Russia: Efficacy and Future Implications”. Whilst there was a focus on Western sanctions since the annexation of Crimea in 2014, Fried explored past historical sanctions, and how they can be used as valuable lessons today.

When discussing their efficiency, Fried argues that sanctions have inflicted a substantial economic damage on Russia, a pressure that will increase over time. He acknowledges criticisms of inefficiency as Russia is still at war, their economy continues to grow and there is a significant evasion of sanctions. However, he compared the current situation to the 1980s when sanctions, despite being deemed a failure, managed to bereave the Soviet economy of crucial resources. Russia’s current economic growth is driven by military expenses, but stresses are evident, such as Gazprom losses.

He admits that sanctions alone won’t work fast enough to save Ukraine, asserting that ‘if you want to save Ukraine you have got to send weapons and lift the restrictions.’ Sanctions in a globalised world are ‘imperfect and partial’ but their goal is not to destroy the Russian economy overnight but to steadily increase pressure on it.

However, Fried does recognise that more needs to be done to enhance the efficiency of sanctions. He praises the price cap on Russian oil, which ensures Russian oil is sold below $60 per barrel, as it ‘takes the money out of their pockets’. However, there is a need for stricter enforcement and secondary sanctions on companies using Russian oil. Addressing Western technology reaching Russia, manufacturers and exporters need to be encouraged to develop a culture of sanction compliance similar to that of banks. Pressure should be applied to all exporters, including those in Taiwan and Kazakhstan, to enforce compliance throughout the supply chain. Enhanced sanction enforcement requires additional resources and personnel. While China doesn’t sell weapons to Russia, it supplies materials aiding Russian weapon production, which may necessitate sanctions on Chinese companies.

He also highlighted the debate over using the $280 billion of immobilised Russian reserves to support Ukraine, stating that ‘the notion that you could use the interest, 3 billion dollars, Is not good enough.’ The idea of taking the estimated $53 billion in accumulated interest is better, but the West should also ‘keep pushing for the $280 billion’.

Fried clarified that ‘affecting Russian politics is not our purpose’. He clarified that the primary objective was the weaken Russia’s ability to wage war. However, as a Student of History, he reflects on historical lessons and expressed cautious optimism, recalling the unexpected triumph of Eastern Bloc dissident movements. As a result, a defeat in Ukraine could lead to new and different trajectories for Russia.