Are sanctions against countries like Iran hindering them in their efforts to tackle the coronavirus pandemic?

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The coronavirus pandemic has drawn the world’s attention to international sanctions. Humanitarian groups have claimed that sanctions are stopping some countries from obtaining medical supplies they need to fight the pandemic. The UN, too, has called for sanctions to be eased, claiming that medical work in Cuba, Iran, North Korea, Sudan, Syria and Venezuela is being hindered.

The potential for sanctions to cause more harm to the populace than the ruling elite has been recognised at least since sanctions contributed to the humanitarian crisis in Saddam’s Iraq during the 1990s.

Both trade sanctions and sanctions targeted at individuals now usually provide for humanitarian exemptions, such as the exemptions provided for in sanctions against North Korea.

Iran has been in focus during the coronavirus crisis. In 2015 the UN endorsed a nuclear agreement with Iran offering sanctions relief in return for limits to the Iranian nuclear programme. The Trump Administration abandoned that deal in 2018 and re-imposed sanctions that stopped most trade in goods as well as and excluding Iranian institutions from the US financial system.

Critics, including the Iranian Government, said that this was preventing Iran from responding to its coronavirus epidemic, the worst in the region. The US countered that there were exemptions in the trade sanctions for medical supplies. The targeted sanctioning of Iranian banks, including the central bank, meant that payment channels for the import of medical supplies were blocked.

The US has now made exemptions to the financial sanctions, allowing transactions involving humanitarian supplies with the central bank, despite the fact that it is still sanctioned.

Meanwhile, the EU has set up INSTEX, a means of transaction that is intended to allow European firms to continue to trade with Iran, despite the US sanctions. The first transaction via INSTEX was for the export of humanitarian goods to Iran to help fight the pandemic, announced on 31 March 2020.

Switzerland has also set up a special payment system for humanitarian trade with Iran.

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