This implicit deterrence
effect operates on two levels: a normative level (Goertz and Diehl, 1992; Tannenwald,
1999) and a material level (Solingen, 2007). According to Goertz and Diehl sanctions
are often the source of a “norms cascade” – the starting point for the
formation of a normative prohibition – and contribute to the continued
importance of an accepted norm by acting as a de facto enforcement mechanism:
“in virtually all cases of functioning norms, there seem to be some sanctions”
(Goertz and Diehl, 1992: 638). Sanctions mark out the target state as a pariah
(Harkavy: 1981), a violator of international protocol – a label that most
states are understandably keen to avoid, especially if it contradicts their
national identity or stated moral values. Yet as Solingen points out, the incentives
for most states to play by the rules and avoid being sanctioned are often far
more pragmatic. Regimes that rely on foreign financial and military aid, technical
expertise from abroad and international trade are usually keen to avoid
crippling embargos (Solingen 2007). Rational states therefore face a
multifaceted calculation when weighing their possible courses of action. States
that are especially susceptible to the costs – both material and normative – of
economic sanctions are far more likely to dismiss the possibility of
rule-breaking before sanctions are even threatened. In other words, if the cost
and likelihood of sanctions are sufficiently elevated for a given state –
especially if the state is reliant on a particular resource, such as oil, or if
they are highly integrated into the global economic and financial system – it
will baulk at the very idea of breaking international rules. “It is quite
likely”, summarises Drezner, “that potential targets try to comply with …
demands before the articulation of a threat … a target refrains from acting
against the sender’s preferences because of the anticipation of sanctions” (Drezner,
2003: 652-656).

            Yet in
order for these material and normative concerns to even factor into a state’s decision-making
process, there must be a strong expectation that specific rule breaking actions
will invite a predictable and costly reaction – in most cases from the global
hegemon. If a hegemon’s reputation for imposing and sticking to tough economic
sanctions in response to certain types of unacceptable behaviour has been decisively
established, possible rule-breakers will think twice before committing an
infraction. This explains why the US and the UN persist in imposing sanctions
on states which are unlikely to yield and why they steadfastly stick to
long-running sanctions where there has been no sign of improvement. An
established reputation for imposing and persevering with economic sanctions is
critical to upholding a system based on deterrence (Peterson 2013). As
President Obama remarked in 2010 about fresh UN Security Council measures
strengthening sanctions against Iran, “it sends an unmistakable message about
the international community’s commitment to stopping the spread of nuclear
weapons” (Reuters, 2010).

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Reputation is equally important in the
case of “explicitly threatened sanctions” – when a state is told in no
uncertain terms by the US or the UN that it will be the target of sanctions if
it does not alter its current behaviour. A reputation as a strict sanctioner can
be established through both actions and words. In terms of actions, a state or
body can establish its reputation by consistently applying sanctions in
response to certain types of behaviour, regardless of the likelihood of
effectiveness. This policy of blanket opposition was the rationale behind UN
resolution 2397 passed in December 2017, which severely increased economic
sanctions on North Korea by sharply limiting oil imports to the country (UN,
2017). These economic sanctions were not imposed with the serious expectation
that North Korea will abandon its nuclear weapons program. Rather, in the words
of the American ambassador to the UN, Nikki Haley, “these unprecedented
sanctions are a reflection of the international outrage at the Kim regime’s
actions” (Guardian, 2017). Yet enforcers such as the US and the UN can also
establish a reputation through words: statements of intent, international
treaties and hand-tying domestic legislation. By communicating to the world B3 that
certain serious acts of rule-breaking beget a predictable reaction – namely the
imposition of economic sanctions – and by enshrining this engagement in
domestic and international legislation, enforcers ensure that states are made
acutely aware of the risks.

What happens in the interim?
What happens in the period of uncertainty when an enforcer’s reputation for
doggedly opposing certain rule-breaking behaviour has not yet been decisively
established? The perceived ambiguity leads to some states unwittingly falling foul of the
law.B4  In
doing so, they expose the mechanics behind the usual risk assessments that
states make on their own account. So long as the threat of sanctions is
credible, states that consider themselves to be vulnerable to economic coercion
will steer clear of rule-breaking (Drezner, 2003: 652-656). Yet in the case
where the likelihood of sanctions being imposed is uncertain, states that fit
this typically cautious profile may try their luck. Their initial calculation,
based on an incorrect estimation of the chance that sanctions will be imposed,
must be quickly revisited once the enforcer gets wind of what they are up to. Cases
like these, where a state makes an erroneous guess at the lengths to which an
enforcer is willing to go to administer international rules, are the best
examples of the effectiveness with which sanctions deter. We cannot completely
get around the “counterfactual problem” (Paris, 2014: 574-576) which prevents
us from demonstrating conventionally whether the deterrent effect of sanctions
actually works. Proving that a country would have broken an international rule
had there not been a credible risk of sanctions is an impossibility. Yet situations
where states backed down after being threatened with sanctions provide a brief
insight into the countless calculations that occur when states are presented
with an opportunity to bend or break the rules. Two historical cases in
particular, that match the criteria mentioned above, illustrate the actual
deterrence capacity of economic sanctions: South Korea and Taiwan’s clandestine
nuclear weapons programs in the 1970s.

South Korea

Growing uncertainty about America’s security commitment to its
east-Asian allies following the articulation of the Nixon Doctrine in 1969 prompted
the South Koreans to launch a covert nuclear weapons research program (Hersman and Peters, 2010: 541). Nixon’s announcement
in Guam that year that “nations directly threatened should assume primary
responsibility for their own defense” rattled the South Koreans, whose economic
expansion had been made possible thanks to the protection of the US security
umbrella (reference).
The unexpected American rapprochement with China (reference) and the US’ stated intent to withdraw 30%
of its forces from Korean soil in the next few years (Drezner, 1999: 254) further
cemented South Korea’s decision to acquire its own atomic deterrent (Hayes and
Moon, 2011: 3). At this point, the US had not yet used sanctions for
non-proliferation purposes and would not in fact do so for another five years. The
South Korean government was therefore caught unawares when in 1975 the United
States began to put pressure on President Park to cancel a deal agreed to
purchase nuclear reprocessing technology from France. This agreement would have
allowed the South Koreans to produce weapons grade plutonium, the final step to
acquiring nuclear weapons as they already had a sufficient level of technical
knowledge and a functional delivery system (Drezner, 1999: 255). Surprised and
dismayed by India’s successful nuclear test in 1974, the US had increased
nuclear intelligence gathering from South Korean physicists and soon uncovered
troubling evidence. Based on South Korean purchases and the intelligence
collected, US officials came to the conclusion that the South Koreans were
pursuing a covert nuclear weapons program (CIA, 1978: i).

            Attempts to pressure the South Koreans to abandon their
program were mere hints at first. Following the fall of Saigon (Drezner 1999:
256) and the requested withdrawal of American troops from Thailand (Khoman
1976: 395), the US was unwilling to cause a diplomatic crisis by openly
confronting President Park’s regime. Rather, they began by delaying a US loan
of $236 million (Drezner 1999: 258) to South Korea’s nuclear energy industry on
the grounds that the country had not yet ratified the Non-Proliferation Treaty.
They also informed the South Koreans that the loan had to be reviewed in light
of India’s own unexpected test – a thinly-veiled threat. Yet South Korea’s
ratification of the international treaty soon after did not end its nuclear
ambitions. It continued to quietly try to close the deal with France for a
nuclear reprocessing facility (CIA, 1978: 6). Although they had ample evidence
that the South Koreans had not ended their nuclear program (CIA, 1978: ii), the
Americans still stopped short of a direct accusation. They remonstrated with
the South Koreans, citing vague worries that the reprocessing deal would “look
bad” and “cause difficulties”. Faced with continued reticence on the part of
the South Koreans however, the US’ threats gradually escalated, becoming
costlier and more explicitly worded. According to the American ambassador to
South Korea, the leadership was asked whether the country was prepared to
jeopardize “the availability of best technology and largest financing
capability which only the US could offer, as well as vital partnership with the
US, not only in nuclear and scientific areas but also in broad political and
security areas” (Drezner, 1999: 258). More specifically, the US threatened to
cut off $275 million in annual military aid, while hinting at further measures,
such as blocking the sale of important technology and ceasing the training of
scientists (Hersman and Peters, 2010: 541). In January 1976, the deal with
France was cancelled after intense pressure and a few months later South
Korea’s broader nuclear weapons program was abandoned. In a secret report drawn
up two years later the CIA concluded that there was no evidence to indicate
that the South Koreans had attempted to restart the program (CIA, 1978: ii).

A report by the US Office of
Technology Assessment – the body tasked with providing Congressional members
and committees with objective analysis of scientific and technical issues –
concluded of the South Korean sanctions episode that: “recent American pressure
upon South Korea to forgo acquisition of a reprocessing plant illustrates that
sanctions can be effective, at least in a situation where the target state is highly
vulnerable” (OTA, 1977). South Korea’s vulnerability was critical to the
effectiveness of America’s threats of economic coercion. America was South
Korea’s largest trading partner, accounting for over a quarter of all South
Korean exports and holding much of the country’s $20 billion foreign debt (Hersman
and Peters, 2010: 541). In terms of the country’s critical infrastructure, the
threat to suspend all trade in nuclear materials would have completely
confounded South Korea’s plans for energy autonomy. The 1973 oil shock reduced
South Korean reserves to just two weeks of petroleum – a state of affairs that
President Park was keen to avoid in the future (Drezner, 1999: 260). South
Korea clearly “failed to give much thoughtB5  to
what the strategic repercussions would be … if it were to manifest a nuclear
weapons program” (CIA 1978: 12)


China’s successful detonation of a nuclear device in 1964
shocked the Taiwanese leadership, who feared a sudden and devastating strike
from the mainland (Burr, 2007: 1). Their calls for pre-emptive US action
against China’s fledgling nuclear program fell on deaf ears and by 1967, the
Taiwanese leadership had decided to develop a clandestine nuclear arsenal. Similar
to the South Koreans, the Taiwanese were dismayed by Nixon’s Guam speech and
the perceived rapprochement between the United States and the People’s Republic
that occurred in the early 1970s. Nixon had famously written in Foreign Affairs that “there is no place
on this small planet for a billion of its potentially most
able people to live in angry isolation”. Attempts by the Taiwanese to acquire
reprocessing equipment from West Germany and the fact that by the mid-1970s they
were buying double the amount of fuel needed to operate their reactors was
noticed by the US Embassy in Taipei (Hersman and Peters, 2010: 543). By 1972,
the CIA had determined that Taipei’s “present intention is to
develop the capability to fabricate and test a nuclear device” (CIA, 1972: 5). Yet
wary of stirring up a hornet’s nest in the region, the Americans again avoided
explicitly threatening their Taiwanese allies. Instead, the Americans tried to
restrict Taiwan’s access to reprocessed nuclear fuel, first opposing a
Taiwanese proposal to Great Britain for the return of reprocessed Taiwanese
fuel, and then pressuring West Germany to jettison a deal for reprocessing
technology in 1973 (Hersman and Peters, 2010: 544). Warnings were initially
vaguely worded and did not clearly threaten economic coercion: “should we have
reason to believe that the ROC has moved from consideration of a nuclear weapons program to actual implementation, we
would be forced to react” (Burr, 2007).

of assurances by Taiwan’s foreign minister that the country would stop trying
to purchase reprocessing technology, America’s vague warnings did little to
slow Taiwanese attempts to develop a nuclear arsenal (Burr, 2007: 1). By early
1976, the International Atomic Energy Agency (IAEA) had detected activities
that raised questions about the direction of Taiwanese nuclear research and
Chinese suspicions that America was helping Taiwan to establish a nuclear
weapons program was souring relations between the two countries (Hersman
and Peters, 2010: 543). The final straw came when Taiwan’s new president Chiang
Ching-Kuo publicly announced that the “the Nationalist Chinese government has
the capability of developing nuclear arms” (Washington Post, 1977). Infuriated
by this statement, Washington ordered its ambassador in Taipei to plainly
threaten economic sanctions. Specifically, they communicated to the Taiwanese
that they were prepared to cut off all fuel supplies, cease all nuclear
cooperation and freeze all arms sales to the island. Should Taiwan or any other
government “seek national reprocessing facilities” warned the US ambassador
“this would risk jeopardizing additional highly important relationships with
the US” (State Department, 1976). The passing of new, hand-tying legislation by
Congress in 1976, which mandated the automatic imposition of sanctions on states
that tried to acquire nuclear weapons, lent these threats credence and Taiwan
soon agreed to the US’ strict conditions (Hersman and Peters, 2010: 543).

Solingen points out, the United States was not only Taiwan’s main trade partner,
source of foreign investment, and provider of military aid, but also its
principal supplier of low-enriched uranium for power reactors (Solingen, 2007:
112). American economic sanctions would have hamstrung the Taiwanese economy (Hersman
and Peters, 2010: 544). Like South Korea, dependence on energy from abroad was
Taiwan’s Achilles heel. Taiwan imported over 80% of its energy needs in the
1970s, mostly oil, and atomic energy had become vital to the regime’s survival.
“Without IAEA and US endorsement, the nuclear energy program was threatened.
Without energy and US preferential trade status, the economic miracle was
doomed. Without a sustained economic miracle, the KMT (Kuomintang)’s political
prospects were fragile” (Solingen, 2007: 112).


results from these two sanctions episodes are in line with expectations. South
Korea, a usually cautious member of the international community, calculated
that due to the apparent indifference of the US to nuclear proliferation, its
covert nuclear program would be either tolerated or pass unobserved. In fact,
such was the initial ambiguity of America’s position on non-proliferation in
the 1970s that the Taiwanese foreign minister felt the need to inquire, “out of
‘curiosity’, what the penalties would be in the event that a nation did not
follow US non-proliferation guidelines” (US State Department, 1977). B6 The
speed of capitulation of both states in the face of US threats – both Taiwan
and South Korea resisted dismantling their nuclear weapons programs for less
than a year – suggests that had America’s reputation for sanctioning been
established, neither country would have initiated a program to acquire nuclear
arms. The case studies also hold important lessons for policymakers. Carefully
targeting sanctions is critical: by taking aim at areas which states deem to be
of national importance – energy supplies, trade flows, military aid etc. – an
enforcer greatly increases the probability that sanctions will succeed. In the adversary
case of isolated states where an enforcer has little or no economic power, the
help of other powerful states that wield influence over the transgressor must
be sought. Crucially, economic sanctions work best when an imposer such as the
US has a strong, self-interested incentive to ensure that states bow to
sanctions pressure. In the context of clandestine nuclear programs, the US had
good strategic reasons for ensuring that as few states as possible acquire atomic
weapons. Every new atomic state reduced the power – in terms of both deterrence
and military effectiveness – of America’s nuclear arsenal. Sanctions are therefore at
their most effective when their aims coincide with great powers’ security
objectives. This
partly explains why sanctions have been both more successful and more
consistently imposed in the field of non-proliferation than human rights.

America’s consistent application of non-proliferation
sanctions has been successful in preventing a nuclear “domino effect” (Miller,
2014). States consider the likelihood and the cost of sanctions before
initiating rule breaking behaviour. As long as the risk of sanctions is
credible, states that are vulnerable to sanctions are likely to be deterred
from breaking rules in the first place. Those that do choose to knowingly break
the rules tend to be isolated hermit kingdoms that are prepared to endure the
threat and imposition of economic sanctions. Gauging the effectiveness of
sanctions solely by examining cases where they were imposed against states such
as North Korea and Iran would be a mistake. Imposed
sanctions that seek to compel a state
to change its behaviour are unlikely to be successful, but they do fulfil an
essential function by deterring less insulated countries that might otherwise
break the rules. As such, it is crucial that the United States continue to
impose sanctions on rule-breaking states, even if the chance that they will
succeed is slim. The risk of sanctions is credible only to the extent that
America actually imposes them.


Sanctions episodes should not be analysed in isolation from
one another. Rather we should see interactions between states as an infinitely
repeated game. Where states interact continually over time, it is cost-effective
for great powers/enforcers to develop reputations for sanctioning
offenders.  By punishing today, states
increase the likelihood of compliance tomorrow because the threat of future sanctions
is credible.


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