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Between 2010 and 2015 the US sanctions on Iran cost the world $ 77b, wrote Bloomberg. Eight out of 10 countries that suffered most due to sanctions on Iran are European ones. Just German and France, the first and second on the list, lost 7.67 and 6.35 billion dollars, respectively, wrote Bloomberg.
Turkey gained most, $ 6.59 billion, in the sanctions against Iran.
Six years ago, in the course of investigating London-based bank Standard Chartered Plc over suspicions it had flouted US sanctions against Iran, the New York State Department of Financial Services published an email from a senior executive to one of his counterparts in New York. 'You …. Americans,' the message read. 'Who are you to tell us, the rest of the world, that we’re not going to deal with Iranians?' wrote Bloomberg.
Bloomberg added that in the second year of Trump administration, the number of financial penalties has hit a high after years of increasing use. 'The current administration is kind of drunk on the sanctions power,” says Jarrett Blanc, a senior fellow at the Carnegie Endowment for International Peace who was a leading Department of State official in the Obama administration responsible for Iran nuclear issues. “They don’t understand that the tool is limited and fragile.”
'Today’s global economy runs through the US financial system, which constitutes a major source of the country's influence. The dollar is the world’s currency, and Wall Street remains a key financial center, which helps US leaders sway friends and coerce rivals. That status is “not ordained', Blanc says. “At a certain point, it might be worthwhile for foreign governments and private-sector actors to work around New York.”
Bloomberg quoted Brian O’Toole, a former senior adviser at the U.S. Department of the Treasury’s sanctions unit, now a senior fellow at the Atlantic Council, as saying the US began stepping up its use of sanctions after the September 11 attacks, deploying them against terror suspects and their financial backers.
Saying that over time, Washington has increasingly used financial penalties as a tool of foreign policy, as in the US-led multinational effort to pressure Iran to curtail its nuclear program, which culminated with the 2015 agreement, the article added that when Trump was elected a year later, the strategy began to shift yet again.
In January 2018 the Pentagon declared that threat to the US. It identified China and Russia as the chief rivals in a new era of great-power politics. “America First” meant that sanctions were more likely to be unilateral—and more likely to be deployed at the expense of other diplomatic strategies. “They've leaned heavily on Treasury,” O’Toole says. “They’ve basically gutted the State Department.”
The Treasury is still pursuing militants. On May 16, it imposed a raft of measures against the Hezbollah. But it’s the renewed attempt to target the economies of Russia and Iran that’s confounded investors and upset US allies.
The article added that the most important response to the onslaught of US sanctions won’t come from the target countries. The key decisions—to comply or defy—will be made by the only actors on the same economic scale as the US: China and Europe.
“For absolutely core national security reasons, China will find ways around the hold of the US banking sector,” says Jeffrey Sachs, an economics professor at Columbia University. In the past five years, China has set up its own lending institutions parallel to the Washington-based World Bank and International Monetary Fund and pushed the Yuan as an international currency. The country is likely to strengthen its presence in Iran no matter what Trump does.
In July 2017, Germany’s Kiel Institute for the World Economy published a study on the economic impact of multilateral sanctions imposed on Russia over its annexation of Crimea three years earlier. While Russia naturally took the biggest hit, a surprisingly large share of the losses—$ 44 billion—was borne by the sanctioners. Of that, almost 40 percent fell on Germany; only 0.6 percent hit the US.
'Reacting to Trump’s Iran decision, French Economy Minister Bruno Le Maire fumed, “Do we want to be vassals who obey decisions taken by the United States while clinging to the hem of their trousers?” Meeting in Bulgaria less than a week later, European leaders agreed on a package of measures to defy American pressure. Special rules to shield European Union companies from US sanctions will be activated for the first time in two decades. The European Investment Bank will be allowed to finance business in Iran, and the EU countries were encouraged to explore transfers to Iran’s central bank.'
Numerous battles loom in the coming months. The global Swift cross-border payment system—based in Brussels but dependent on US cooperation—is one likely flashpoint.
Sachs said that in the long term there’s a bigger risk. Countries such as Iran, Russia and Venezuela may chafe at the dominance of dollar by promoting its own state-backed cryptocurrency.
“Europe and China have banks,” he says. “One of these days, the US is going to talk the dollar right out of its international role.”
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