Executive Summary
Economic sanctions are one of the most commonly used tools in international politics. They are presented as a peaceful alternative to war. The reality is more complicated. Sanctions have crippled entire economies, kept brutal governments in power, and killed civilians through shortages of medicine and food — while the regimes they were aimed at stayed standing. The question is not whether sanctions hurt. It is who they hurt.
Key Takeaways
- Economic sanctions are restrictions placed on a country's trade, finances, or access to the global economy to pressure it into changing its behaviour.
- They are used as an alternative to military action — but their track record of actually changing government behaviour is mixed at best.
- The people who suffer most from sanctions are almost always ordinary civilians, not the governments the sanctions are aimed at.
- Iran has been under some form of US sanctions for over 40 years. Its government is still standing.
- Sanctions work best when they are part of a broader strategy — not when they are used as a substitute for having one.
What Sanctions Actually Are
An economic sanction is a restriction one country or group of countries places on another. It can take many forms. A ban on trading certain goods. A freeze on financial assets held abroad. Restrictions on importing or exporting oil. Blocking a country's banks from the global financial system. In extreme cases, a full embargo — where no trade is allowed at all.
The goal is to make it economically painful for a government to continue doing whatever it is doing. The logic sounds straightforward: cut off a country's money, and eventually it will have to change course.
That logic is appealing to politicians because it looks decisive without requiring anyone to send soldiers into a warzone. It is the option between doing nothing and going to war. Domestically, it plays well. Internationally, it signals disapproval without crossing into open conflict.
The problem is that the logic only works if the government you are sanctioning cares more about its economy than it does about whatever it is being sanctioned for. That is a much bigger assumption than it sounds.
The Different Types of Sanctions
Not all sanctions are the same, and understanding the difference matters.
Comprehensive sanctions target an entire country's economy. The US embargo on Cuba, which began in 1962, is one of the oldest and most complete examples. Cuba's economy has been restricted from accessing American markets and financial systems for over six decades. The Cuban government is still in power.
Sectoral sanctions target specific parts of an economy. The sanctions imposed on Russia after its 2022 invasion of Ukraine targeted the energy sector, financial institutions, and technology imports specifically. The idea was to hit the parts of the Russian economy that fund the military without cutting off all trade entirely.
Targeted or "smart" sanctions go after specific individuals. Freeze the bank accounts of government officials. Ban them from travelling. Seize their assets held in foreign countries. The theory is that you can pressure the people making decisions without punishing the general population. In practice, targeted sanctions are often more of a symbolic gesture than a genuine economic pressure tool.
When Have Sanctions Actually Worked?
The case most frequently cited is South Africa in the 1980s. International sanctions against the apartheid government, combined with significant internal resistance and international isolation, contributed to the end of apartheid. The sanctions were broad, sustained over years, and had genuine domestic political support in the countries imposing them.
Iran's nuclear negotiations in 2015 are another partial success story. The combination of oil sanctions and financial restrictions via the SWIFT banking system caused a significant contraction of Iran's economy. That economic pressure contributed to Iran agreeing to the Joint Comprehensive Plan of Action (JCPOA), which placed limits on its nuclear programme in exchange for sanctions relief. It did not end the Iranian government. It did produce a specific, verifiable behavioural change on a specific issue.
Libya's decision in 2003 to give up its weapons of mass destruction programme was partly linked to sanctions pressure, though the broader context of the Iraq War almost certainly played a role as well.
These are the successes. They are real. They are also the exceptions, not the rule. For every case where sanctions contributed to a policy change, there are several more where they did not.
When Sanctions Have Failed — And Why
Iran is the most instructive failure case, partly because it is so long-running. The United States imposed its first sanctions on Iran in 1979 following the hostage crisis. That is over 45 years ago. Since then, the sanctions have expanded, been lifted partially, reimposed, expanded again, and tightened further. Iran's nuclear programme advanced through most of that period. Its government never fell. The population experienced real economic hardship. The government used that hardship, at times, to blame external enemies and consolidate domestic support.
Iraq under Saddam Hussein is a more extreme example. The comprehensive sanctions imposed after the 1991 Gulf War were maintained throughout the 1990s. Studies published in respected medical journals estimated that tens of thousands of children died as a result of deteriorating healthcare and nutrition. Saddam Hussein remained in power until a military invasion removed him in 2003. The sanctions did not achieve their stated goal. They did cause significant civilian suffering.
North Korea has been under severe international sanctions for decades, including restrictions imposed by the UN Security Council. It has continued developing nuclear weapons regardless. In fact, there is an argument that the sanctions accelerated North Korea's nuclear ambitions, because a nuclear weapon provides a deterrent that sanctions cannot neutralise.
Russia is the most recent and still-evolving case. After the 2022 invasion of Ukraine, Western countries imposed what were described as the most sweeping sanctions in history. Russia's economy contracted, inflation rose, and it was cut off from significant portions of the global financial system. By 2024, Russia's economy had adjusted, partly by redirecting trade through China, India, and other countries that did not join the sanctions regime. The war in Ukraine continued.
The Problem Nobody Talks About
The fundamental contradiction in how sanctions are discussed is this: they are presented as an alternative to harming civilians, but they almost always harm civilians most.
Governments under sanctions typically have access to mechanisms that ordinary people do not. They can maintain hard currency reserves, access black markets, route money through third countries, and prioritise their own needs. The general population faces shortages of imported medicines, rising food prices, restricted access to banking, and declining public services.
The sanctioning country knows this. It is not a secret. The standard response is that the humanitarian harm caused by sanctions is the responsibility of the sanctioned government, which could end the sanctions by changing its behaviour. That argument has a certain logic to it. It also, in practice, means that the civilian population of a country with a government it cannot remove is made to suffer for decisions it did not make.
There is a word for using civilian suffering as a pressure mechanism. It is not a comfortable word. Most governments prefer not to use it when describing their own foreign policy.
This dynamic is directly visible in the current Iran situation. As we reported in our analysis of the ceasefire talks breakdown, one of Iran's core demands in Islamabad was the unconditional release of frozen assets. Iran has had billions of dollars in assets frozen by the US for decades. That money belongs to Iran. The sanctions froze it as leverage. The leverage has not produced the outcome the US wanted. The frozen assets remain a source of grievance that makes every negotiation harder.
The Sanctions Game Iran Has Been Playing for 40 Years
Iran deserves its own section in any honest analysis of sanctions, because it is the world's longest-running sanctions case.
The US first sanctioned Iran in 1979. Since then, every US president has maintained, expanded, or modified the sanctions regime. Obama used them successfully enough to get Iran to the negotiating table in 2015. Trump reimposed the harshest sanctions in history after withdrawing from the nuclear deal in 2018. Biden largely kept them in place while trying to revive negotiations.
Throughout all of this, Iran's nuclear programme continued advancing. Its regional influence expanded through proxy groups in Lebanon, Yemen, Iraq, and Gaza. And as we analysed in our piece on what Washington actually achieved in the Iran war, the ceasefire deal the US accepted includes Iran's insistence on the right to continue uranium enrichment. Forty-five years of sanctions. That is where it ended up.
To be fair, this does not mean sanctions had zero effect. Iran's economy has been genuinely damaged. Its military and technological development has been slowed in specific areas. Some analysts argue that without sanctions, Iran would have developed a nuclear weapon years ago. That is a reasonable argument. It is also impossible to prove.
What This Means
Sanctions are not useless. They are also not a strategy by themselves.
The evidence suggests they work best in specific conditions: when the target country has significant trade dependence on the sanctioning countries, when the sanctions are broad and multilateral rather than unilateral, when there is a clearly defined and achievable behavioural change being demanded, and when they are part of a broader diplomatic strategy rather than a substitute for one.
When those conditions are not met and they frequently are not — sanctions tend to produce a predictable pattern. The targeted government becomes more authoritarian, more nationalist, and more hostile. The civilian population suffers. The government uses the external pressure to justify internal repression. And the sanctioning country, having committed to a policy it cannot easily reverse without appearing weak, keeps the sanctions in place long after any realistic hope of achieving the original goal has passed.
The honest version of this is: sanctions are often less about changing the target's behaviour and more about satisfying a domestic political need to be seen doing something without the costs of military action. That is not always wrong. But it should be named for what it is.
So What Next?
Sanctions are not going away. If anything, they are becoming more sophisticated and more widely used. The financial tools available — cutting countries off from SWIFT, freezing sovereign assets, targeting cryptocurrency flows — are more powerful than they were a generation ago.
But the fundamental tension remains. Sanctions hurt civilians. Governments that do not answer to their civilians do not change course because civilians are hurting. The populations most vulnerable to sanctions are often the ones with the least power to change what their government does.
Until the international community is willing to have that honest conversation, sanctions will continue to be used as they almost always have been: as a tool that feels morally cleaner than war, produces uncertain results, and asks the most from the people who had the least say in causing the problem.
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Santhosh Vishwamitra
Web Developer and Founder of Inside Stories, launched in February 2026.
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