Amid Ongoing Middle East Conflicts, International Sanctions Expand with Increasing Complexity and Third-Party Evasion Tactics
As global crises continue to unfold across the Middle East, the business of sanctions is thriving, with the UN, US, EU, and UK imposing a wave of restrictive measures to address geopolitical tensions and security threats. A recent report by Lexis Nexis Risk Solutions, titled “Taking the Pulse of Major Sanctions Lists,” highlights the escalating use of sanctions as a diplomatic tool, revealing a 13% year-on-year increase in net global designations for 2024. The trend shows no signs of abating as western nations aim to combat complex issues, including the war in Gaza and the rising influence of militant groups.
Third-Country Evasion Tactics: A Growing Challenge
The report sheds light on the increasing use of third-country evasion tactics, in which intermediaries and networks facilitate prohibited imports or exports to sanctioned states, effectively bypassing restrictions. This growing issue complicates the enforcement of sanctions and underscores the need for enhanced vigilance by global regulators to prevent sanctions violations. Such evasion practices have been particularly challenging in regions where sanctions compliance and enforcement are inconsistent, allowing illicit networks to thrive.
Sanctions: A New Normal in Global Diplomacy
According to the report, the initial surge in sanctions activity has now “settled into a new level of normal” that is expected to persist through the end of 2024. This wave of sanctions is being driven by renewed political leadership in Europe and the upcoming US presidential election, which are likely to shape the future direction of the global sanctions agenda.
The US Treasury Department’s Office of Foreign Assets Control (OFAC) has played a leading role, being responsible for 67% of all sanctions designations made in the first half of 2024. Terrorism and Russia-related concerns were each implicated in 28% of OFAC cases, with targets ranging from Iranians, Hamas and Hezbollah leaders to Israeli settlers in the West Bank.
Middle East: A Focus of Sanctions Activity
The Middle East has been at the center of sanctions measures, reflecting the region’s continued geopolitical volatility. The report highlights how sanctions have been imposed on groups such as Hamas and Hezbollah, as well as their supporters and proxies. Notably, new sanctions were also introduced against Israeli settlers in the West Bank, marking a significant development in international policy as Western nations seek to address violent actions by extremist elements on both sides of the conflict.
“The situation in the Middle East is a clear foreign policy concern, which has translated into significant sanctions actions,” the report states. The dual policy objectives have been to disrupt the operational capabilities of militant groups like Hamas and Hezbollah, while also taking action against extremist behavior by Israeli settlers. The coordinated efforts by the US, EU, and OFAC represent a strategic attempt to mitigate violence and instability in the region.
Broader Sanctions Context: Iran, Russia, and Syria
The report also provides insights into other significant sanctions developments, including EU measures against Iran for its support of Russia, as well as sanctions targeting Syrian business figures who have provided financial backing to the Syrian government. These designations reflect the broader international response to countries and entities seen as contributing to global instability, whether through direct involvement in conflicts or financial support to sanctioned regimes.
Trends and Impact of Sanctions Activity
“Taking the Pulse of Major Sanctions Lists” offers a comprehensive look at the scale, speed, and trends of sanctions activity worldwide. It highlights the increasingly interconnected nature of global sanctions, where actions taken by one nation or bloc often trigger complementary measures by others. As sanctions continue to evolve in response to new crises, they remain a key instrument of international diplomacy.
Conclusion: Sanctions as a Strategic Tool Amid Global Crises
The proliferation of sanctions in the Middle East and beyond reflects a concerted effort by Western nations to address and mitigate global crises through economic restrictions. From targeting militant groups and extremist settlers to combating third-country evasion tactics, sanctions are being used as a strategic tool to exert pressure and uphold international security.
As the landscape continues to shift, the effectiveness of sanctions will depend largely on the international community’s ability to adapt enforcement measures to counter evasion tactics and ensure compliance. With new political dynamics emerging and evolving conflicts in the Middle East, the “business of sanctions” shows no sign of slowing down, cementing its role as a crucial aspect of global diplomacy.
