United States (U.S.) sanctions are a foreign policy instrument used by the U.S. government to put pressure on entities, individuals, whether they are from the world of politics or business, and encourage changes in their behavior. These sanctions usually involve restricting or prohibiting trade, financial transactions, or other forms of economic interaction aimed at achieving certain political or security goals.
The U.S. ambassador to Bosnia and Herzegovina (BiH), Michael Murphy, explains that the U.S. will always protect its interests in the Balkans, while the public is focused on the verbal war between the president of the RS entity, Milorad Dodik, and the U.S. ambassador. The ambassador accuses him of economically destroying the entity, and that the worst is yet to come, Dodik denies it all.
“Dodik may not recognize our sanctions, but our sanctions really recognize Dodik. In public, sanctioned persons, regardless of who they are, often say that the sanctions do not affect them, but I will tell you something, in private they really spend a lot of time and money to get off the blacklist,” said Murphy.
A U.S. blacklist means that all assets of sanctioned persons that are in the U.S. or owned or controlled by U.S. persons are blocked and must be reported to OFAC. Practice has shown that the only effect of the sanctions so far has been the cessation of business with foreign-owned banks.
The U.S. can impose economic sanctions in a variety of ways, including:
Limiting access to certain financial institutions or banning certain types of financial transactions; placing restrictions on the import and export of goods between the U.S. and the target country; a complete ban on trade with a certain country; restricting the travel of certain individuals or members of the government; blocking the assets of individuals or entities to which sanctions have been imposed.
Real-time sanctions functionality
The consequences can also be seen on other sides, it is increasingly difficult for the authorities to find new sources of budget financing, this time they did not go to the international market to collect money for debt repayment, as they did in the previous period by borrowing on the Vienna and London stock exchanges.
One of the key features of U.S. sanctions is that those who are on the U.S. blacklists cannot travel to the U.S., do business, have accounts, or dispose of any property on the territory of the U.S. or buy it.
In a conversation with certain experts from the banking sector, the problem for individuals who are on the U.S. blacklist could be the eventual opening of accounts abroad, considering that banks, even though they are not American, have the discretion to refuse cooperation with persons who are part of American sanctions, and that, they explained, is not a rare case. It is very difficult to find a financial institution that does not work according to the U.S. standards or has no contact with the U.S.. They say from the banking sector, it is difficult for people on the U.S. blacklist to open bank accounts, but also to make card payments.
That U.S. sanctions are useful is perhaps best demonstrated by the experiences of some of the sanctioned, which they have conveyed to certain media. Convicted war criminal Biljana Plavsic once told what it’s like to live with, among other things, U.S. sanctions:
“It happened sometime right after those catastrophic floods in RS, in 2014. Since I receive a pension from RS, then I went to the bank of which I was a client in order to donate money for the victims. However, after only a few days, I received a call from the bank to come for a meeting with the authorities, and they then told me that they could not approve any financial transactions from my account because I was a war criminal and a person on the U.S. blacklist. After that, I was looking for any way to move to another bank through which I will receive my pension.”
Direct impact of U.S. sanctions on citizens
While sanctions are intended to exert pressure on the government or politicians of a particular country to achieve changes in their behavior, they often have a direct impact on the citizens of that country. Sanctions can restrict trade, cause inflation, reduce economic growth and cause unemployment, which directly affects the standard of living of citizens, Forbes reports.