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Overview and Analysis of Current U.S. Unilateral Economic Sanctions Investigation No. 332-391 Publication 3124 August 1998 U.S. International Trade Commission COMMISSIONERS Lynn M. Bragg, Chairman Marcia E. Miller, Vice Chairman Carol T. Crawford Jennifer A. Hillman Stephen Koplan Thelma Askey Robert A. Rogowsky Director of Operations Acting Director, Office of Economics Arona Butcher Chief, Country and Regional Reports Division Address all communications to Secretary to the Commission United States International Trade Commission Washington, DC 20436 U.S. International Trade Commission Washington, DC 20436 Overview and Analysis of Current U.S. Unilateral Economic Sanctions Publication 3124 August 1998 U.S. InternationalOverview and Trade Analysis Commission of Current U.S. Unilateral Economic Sanctions Project Staff Office of Economics James Stamps, Project Leader Arona Butcher, Nancy Benjamin, Diane Manifold, Edward Wilson Office of the General Counsel Rhonda Hughes Office of Industries Richard Brown, Chief, Services and Investment Division James Bedore, Coordinator Division Coordinators Jonathan Coleman, Cynthia Foreso, John Kitzmiller, Dennis Luther, Christopher Melly, Charles Yost International Trade Analysts Tsedale Assefa, Scott Baker, Jennifer Baumert, James Brandon, Steve Burkett, Gail Burns, Michael Bystry, Robert Carr, William Chadwick, Roger Corey, John Davitt, Alfred Dennis, Vincent DeSapio, Hugh Graham, Jack Greenblatt, Jean Harman, William Hoffmeier, David Ingersoll, Christopher Johnson, Larry Johnson, Jozlyn Kalchthaler, Scott Ki, Danielle Kriz, Kathleen Lahey, Dave Ludwick, Tim McCarty, Deborah McNay, Reuben Mata, Doug Newman, John Pierre-Benoist, Laura Polly, John Reeder, Rick Rhodes, George Serletis, Rose Steller, Karl Tsuji, Linda White, Amanda Yarusso Reviewers Linda Linkins and Jan Summers Special Acknowledgments Maureen Bryant Pamela Dyson, Keven Blake, Joyce Bookman Administrative Support Patricia Thomas ABSTRACT On March 23, 1998, the United States International Trade Commission (USITC or the Commission)institutedinvestigationNo.332-391,OverviewandAnalysisofCurrentU.S.Unilateral EconomicSanctions. Theinvestigation,conductedundersection332(g)oftheTariffActof1930,isin response to a request from the Committee on Ways and Means, U.S. House of Representatives (see Appendix A). The USITC solicited public comment for this investigation by publishing a notice in the Federal Register of March 30, 1998 (63 F.R. 15215). Appendix B contains a copy of the notice. A public hearingwasheldforthisinvestigationonMay14,1998. Appendix Clists thehearing participantsand individuals who provided written submissions. The purpose of this report is to describe U.S. unilateral economic sanctions currently in effect; to survey affected U.S. industries on the costs and effects of U.S. unilateral economic sanctions; to reviewtheexistingliteratureontheeconomiceffectsofsanctions;andtoproposeamethodologytobe used in future studies to analyze the short- and long-term costs of economic sanctions. The request letter provided a specific definition of the term “unilateral economic sanction” to be used for this report. The Commission identified 42 separate U.S. statutes that authorize or set forth economic sanctions; under these statutes there are a total of 142 federal sanctions-related provisions in such categories as arms proliferation, terrorism, national security, environmental protection, narcotics, expropriation of U.S. property, communism, war crimes, human rights, worker rights, and forced labor. TheCommissionidentifiedatotalof29countriessubjecttoU.S.unilateraleconomicsanctions. The Commission’s likely approach in future studies estimating the short- and long-term costs of U.S. unilateral economic sanctions would be to jointly employ a variety of methodologies in an effort to capture fully the effects of economic sanctions. Economic literature was reviewed to identify the methodologies applied to estimate the economic effects of U.S. sanctions. The information provided in this reportis forthe purposeof thisreport only. Nothingin thisreport should be considered to reflect possible future findings by the Commission in any investigation conducted under statutory authority covering the same or similar subject matter. iii iv CONTENTS Page Executive Summary . ix Chapter 1. Introduction . 1-1 Purpose of the report . 1-1 Scope of the report . 1-1 Definition of “unilateral economic sanctions” . 1-1 Trade measures excluded . 1-1 Approach . 1-4 Organization of the report . 1-4 Overview . 1-5 Potential impact of U.S. unilateral economic sanctions . 1-6 Countries subject to U.S. unilateral economic sanctions . 1-8 Chapter 2. U.S. Unilateral Economic Sanctions . 2-1 U.S. unilateral economic sanctions . 2-1 Overview . 2-1 Administration and enforcement of U.S. economic sanctions . 2-1 Major categories of sanctions . 2-16 List of U.S. sanctions . 2-16 Sources and methodology . 2-16 Observations . 2-17 State and local sanctions in effect . 2-18 Chapter 3. Costs and Effects of U.S. Unilateral Economic Sanctions . 3-1 Results of telephone survey . 3-1 Methodology . 3-1 Approach . 3-1 Scope of the survey . 3-2 Principal findings of the survey . 3-2 Effects of unilateral economic sanctions by broad economic sectors . 3-5 Agriculture and forest products . 3-5 Grains . 3-5 Specialty crops . 3-6 Winter vegetables . 3-6 Citrus . 3-6 Sugar . 3-6 Cigars . 3-7 Fish . 3-7 Forest products . 3-7 Chemicals and energy . 3-8 Chemicals . 3-8 Energy . 3-8 Minerals, metals, machinery, and miscellaneous manufactures . 3-9 Electronic technology and transportation . 3-10 Service industries . 3-10 v CONTENTS-Continued Page Chapter 3. Costs and Effects of U.S. Unilateral Economic Sanctions—Continued Summary of hearing testimony and written submissions . 3-11 Ed Wiederstein, American Farm Bureau Federation . 3-12 Harold A. Wagner, Air Products and Chemicals, Inc. 3-12 William C. Lane, Caterpillar, Inc. 3-13 Frank Kittredge, National Foreign Trade Council, on behalf of USA-Engage . 3-14 Arthur Downey, Baker-Hughes, Inc., on behalf of USA-Engage . 3-14 Willard M. Berry, European-American Business Council . 3-15 Ernest Z. Bower, U.S.-ASEAN Business Council . 3-16 Patricia Davis, Washington Council on International Trade . 3-16 Robert L. Muse, Muse & Associates, on behalf of the National Council on International Trade Development . 3-17 Bobby F. McKown, Florida Citrus Mutual . 3-17 Charles D. Dean, Jr., Dean Hardwoods, Inc. 3-18 Peter L. Fitzgerald, Stetson University, College of Law . 3-18 Jonathan Eaton, Boston University, Institute for Economic Development . 3-18 Kimberly Elliott, Institute for International Economics . 3-19 Chapter 4. Literature Review and Assessment of Methodologies . ..
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