The Ripple Effects of Economic Sanctions

Siti Khadijah Haji Mohd Salleh, Ahmed Khalid and Gamini Premaratne

World Economics, 2025, vol. 26, issue 2, 63-90

Abstract: Economic sanctions on Iran, Pakistan, Russia, and Cuba from 1990 to 2022 restrict trade, and impact population growth and life expectancy, yet paradoxically increases GDP per capita as these countries adapt by diversifying trade partners, though this comes with significant socioeconomic costs. The study reveals that sanctions lead to surging unemployment due to trade disruptions, increase dependency rates, reduce consumer spending, and exacerbate poverty, inequality, and social unrest in the targeted nations. Sanctions destabilise markets in these countries, causing currency depreciation, inflation, and liquidity crises, which hinder investment and economic recovery, amplifying the broader ripple effects throughout their economies.

Date: 2025
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