No. 38 September 2012

The EU’s Sanctions against Syria: Conflict Management by Other Means Clara Portela

froze the assets held in European accounts in Since May 2011, the EU has launched one order to prevent ousted leaders from accessing of its most far reaching and sophisticated state funds. In Libya, sanctions were quickly sanctions operations in support of the followed by a multinational military operation protests against the current regime in Syria. under NATO command which precipitated The present brief examines the measures the defeat of government forces. By contrast, wielded by the EU, its expected impact and in Syria neither have the protests succeeded in its implications for the EU’s relations with ousting President Bashar Al-Assad, nor has the its global partners. While seriously use of force been seriously contemplated. The undermined by the lack of support of Syrian leadership consistently refuses to step Russia, the sanctions are having a down or to negotiate with opposition groups, noticeable economic impact. Yet, the opting instead for a strategy of repression choice of measures is ill-suited to stop the which has been the subject of widespread bloodshed. The sanctions have also served international condemnation. Since the to (re)define partnerships with other eruption of violence in March 2011, the powers, both in the Middle-East and situation has been characterised by stalemate, globally. until protesters started making progress against government forces in July 2012. In the face of continued violence, the United Nations One year and a half after the beginning of the Security Council (UNSC) remains deadlocked: anti-regime protests, the ’s Russia has indicated its readiness to yield a (EU) response to the Arab Spring has taken veto against any proposal to intervene. A some unprecedented traits. The popular military operation to put an end to the uprisings in the Arab world have led the EU to crackdown on protesters remains unlikely for employ an instrument it had been traditionally fear of a domino effect that could exacerbate reluctant to use in this region: sanctions. They conflicts in this volatile region. The UK along were imposed against targets in Tunisia, Egypt with the US and some of Syria’s neighbours and Libya in the early days of the Arab Spring. (Saudi Arabia and Qatar), has resorted to However, they fulfilled different roles: In arming opposition forces. Yet, the EU is still Tunisia and Egypt, where leaderships were far away from reaching an agreement on unseated after only few weeks of protests, military intervention – even though calls in giving way to transitional governments, the EU that direction proliferate among European

EGMONT Royal Institute for International Relations 1 politicians. In the absence of policy alternatives, 2012). The sanctions package comprises a set sanctions currently constitute the core of the of very diverse measures which can be EU’s response to the conflict in Syria. The EU expected to affect the regime and Syrian first asked Al-Assad to negotiate with the society very differently. Also, these measures opposition, then to cease repression, and as display different level of “targetedness”, from August 2011, to leave office (Balfour defined in terms of their capacity to 2012). These demands were supported by discriminate between targets. A brief overview2 sanctions imposed alongside those of the US, of the main prohibitions follows: and tightened in reaction to successive • A first set of sanctions targets the Syrian crackdowns on civilians. government: EU sanctions prohibit disbursements and assistance by the The sanctions against Syria are European Investment Bank (EIB) as well unprecedented. To begin with, the EU as new grants or loans by the member deployed the virtual entirety of measures in the states. The EIB had some 17 project sanctions toolbox within less than a year. In its underway in Syria in 2011, and reportedly past practice, it usually wielded an arms a portfolio worth €1.3 billion (Norman embargo and a visa ban on the leadership and 2011). In the same vein, measures are their associates. The tightening of sanctions in designed to ensure that private actors in subsequent rounds often consisted in Europe do not issue loans for those lengthening the blacklist and applying an assets cooperation projects that have been freeze to the featured individuals. While this interrupted by the EU – notably, the process often took years, the sanctions against construction of power plants. The issuing Syria have accumulated the whole set in just a of insurance to the Syrian government few months. Most notably, they entail an and the opening of new subsidiaries of energy embargo, namely a ban on the import of Syrian banks in the EU are banned, as is oil from Syria – a rare measure for the EU to the opening of new offices of European adopt in the absence of a UNSC mandate given banks in Syria. The assets of the Syrian that the EU imports this oil to meet its own central bank in the EU are frozen and it is energy needs. Prior to the embargo, the EU’s forbidden to trade public bonds to and import of Syrian crude was worth over €3 from the Syrian government, public billion a year, and went mostly to Italy and bodies and financial institutions. Germany1. Finally, sanctions were agreed at the request of the League of Arab States (LAS), a • A second set of sanctions targets those regional organisation that had encouraged such individuals directly involved in the measures against one of its members only once exercise of repression, with the intention before in its history – against in the early of affecting them and their associates 1990s. personally. They are prohibited from entering the territory of the EU, and the A WHOLE SET IN LESS THAN A YEAR assets they hold in Europe are frozen. The declared objective of the EU is to increase These individuals feature in a blacklist pressure on the Assad regime to end currently comprising 155 entries, while repression, withdraw the Syrian army from the blacklist of entities to which they are besieged towns and cities, the implementation linked numbers 53. The freezing of assets of democratic reforms and an inclusive national and the visa ban on the leadership and dialogue. The sanctions wielded against Syria their associates fulfils a double objective: encompass 17 sets of restrictive measures, cutting them off from financial assets so according to the EU’s own counting (Council these cannot be used for repression and

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making the conduct of their business in • A fourth set of sanctions specifically Europe more difficult. Family members of targets the energy sector, with the the Syrian leadership are simultaneously intention of cutting off the government’s heading state companies and entities sources of revenue, and thus weaken associated with the regime – a personal repression. These entail a ban on the connection that warrants their listing. In import of oil and petroleum products addition, they stigmatise blacklisted from Syria, but also a prohibition on individuals and inconvenience them in a providing insurance to this sector, private capacity. supplying technology for the oil and natural gas sector, as well as providing • A third set of sanctions is directed towards loans to enterprises engaged in the oil the repressive apparatus of the regime. industry. The purchase or increase in Some measures concern the arms sector: participation in Syrian enterprises engaged the transfer of weapons and equipment in the oil sector is prohibited. The that can be used for internal repression is electricity sector is also affected: banned. The arms embargo is participation in the construction of new supplemented by technical and financial power plants for electricity generation, the assistance related to these items. The initial provision of technical or financial arms ban was broadened to encompass assistance and the creation of joint some dual-use items in the tightening that ventures to that end is also banned. The took place in April 2012. An innovative ban on oil and petroleum products from measure not covered by standard EU Syria is the single most powerful measure embargoes consists in banning the supply in the package, given that fuels and mining of software for the interception of internet products constitute over 89% of the EU’s and phone communications; in other imports from Syria.4 The ban on insurance words, the sort of equipment necessary for has serious economic implications, since the security forces to locate opposition oil shipments now have to be insured by forces and monitor their activities. The authorities in the recipient states, which latest reinforcement of the embargo might not be prepared to bear the costs. consists in the decision to inspect vessels and aircraft suspected of transporting • A fifth category concerns trade weapons to Syria via Europe, a measure restrictions. Measures affecting bilateral along the lines of UNSC sanctions regimes trade include a ban on cargo-only flights, against Iran and North Korea. and a ban on the export of certain goods: The EU arms embargo is not bound to luxury products, gold, diamonds and have any major effect: Syria’s top weapons precious metals. Aside from the oil suppliers are Russia, Iran, Belarus and embargo, the trade measures are modest. North Korea, while supplies from The EU merely imported some textiles European countries stopped already in the and agricultural products from Syria, early nineties. Russian arms exports to sectors representing respectively 4.8% and Syria have more than tripled in the period 2.7% of total imports from Syria. The from 2008 to 20113, and continue into restrictions affecting trade are geared 2012. Nevertheless, the mere prohibition towards preventing conspicuous upgrades of software can have some limited impact, in the limited trade flows that remain after as alternative suppliers can offer similar the import of oil, which made up most technology, but of lower efficacy. bilateral trade. The ban on luxury goods, one of the most recent measures, is also

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directed against the elite. Overall, the bans symbolism of the message they convey, such affect imports are rather marginal. In 2011, as the ban on luxury goods or the blacklisting Syria was the EU’s 54th trading partner, of high-ranking officials. The trump card of accounting for only 0.2% of its trade with the sanctions package is the oil embargo, given the world. By contrast, the EU accounted that most of the oil produced by Syria used to for 21% of Syrian trade with the world5, be sold to the EU. This constitutes the only and the export of crude oil to the EU measure, along with the restrictions in the represented 27.4% of total exports in 2010. banking sector, which is reportedly fulfilling its Restrictions also concern the provision of objective of depriving the regime of key financial support for trade: member states revenue (Landis 2012). According to the EIB, are not allowed to enter into long-term in 2011 growth was negative (estimated at - commitments, while short- and medium- 2%) due to the conflict and the international term financial support for nationals and sanctions, and with the decrease in oil, tourism entities trading with Syria are discouraged. and tax revenues, the fiscal deficit is expected In spite of these restrictions, trade to increase to 11%.6 The GDP reportedly preferences per se have not been contracted by 3.4% during 2011, according to withdrawn – the procedure foreseen for the the Economist Intelligence Unit. However, the suspension of the Generalised System of prohibition on insurance and supply of spare Preferences (GSP) would take over a year, parts for the oil and gas sector, which proved and the fear is that it would mostly affect effective when applied on Libya by the US in small and medium enterprises unconnected the 1990s, needs years to display its results. to the regime. One could presume that the trade-related measures are susceptible of affecting trade Finally, several EU member states such as beyond the stipulated prohibitions by Belgium, France, Italy, the Netherlands and increasing the risk premium on economic Spain have closed their embassies in Damascus, engagement with Syria. In other words, a diplomatic sanction that does not qualify as an European companies might be discouraged EU measure given that it was not jointly agreed from conducting trade with Syria even in by the European Council. Yet, the EU goods that are currently permitted for fear that Delegation remains open. what is now legitimate commerce might be banned in a subsequent tightening. However, BUT CAN THEY WORK? such effects are hardly desirable: Firstly, What impact do these measures have – and do because EU sanctions aspire to be targeted and they stand a chance of succeeding in should discriminate between those who are discouraging repression? EU officials have involved in government repression and those reportedly indicated that the sanctions package who are not; and secondly because they may “seems to make the functioning of the interfere with the provisions for the numerous government more difficult” and “causes humanitarian exemptions that permeate EU significant anxiety and concern to the Syrian sanctions legislation. regime” (Mahony 2012). In order to transform the arms embargo into an effective measure, it STRATEGIC ISSUE, DECEPTIVE would need to be universalised and made PARTNERSHIPS mandatory by means of a UNSC Resolution – a If hitherto unable to halt the violence in Syria, step that the EU and the US have been the EU has nonetheless managed to take joint promoting to no avail, most recently in July action and to position itself on this delicate 2012. Certain measures can hardly be expected issue vis-à-vis other regional and global to instil a policy change in spite of the strong powers. Significantly, the EU’s sanctions

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package is in tune with the position of Syria’s sanctions regime. Sanctions have been adopted neighbours: the imposition of sanctions by traditional partners of the EU, such as responded to a call by the , Switzerland. Even Turkey, a key regional composed by a group of countries traditionally power directly neighbouring on Syria, has sceptical of the use of this policy tool. The imposed sanctions that go beyond “any suspension of Syrian membership by the previous Turkish sanctions against any Organisation of Islamic Co-operation, a body neighbour” (Walker 2012). Turkey originally composed of 57 members, highlights the wide wielded an arms embargo, assets freezes, and condemnation of the regime among Islamic diplomatic sanctions, but later added trade countries (with the notable exception of Syria’s sanctions such as raising taxes on Syrian goods ally: Iran). The position of the EU has a double, and closing border crossings for trade. partly contradictory motivation. Part of the impulse behind the sanctions is to show support The sanctions have pitted the EU against for the Arab uprisings, in an attempt to make up Russia, one of its “strategic partners”, which for its lack of determination during the first continues to threaten a veto in the UNSC. weeks of the Arab spring in early 2011. The self- Supporting the sanctions would contradict avowed half-heartedness with which the EU had significant traits of its foreign policy. It would promoted democracy in the region until the entail ceasing support for the last remaining popular revolts erupted constitutes an ally inherited from the Cold War era in a embarrassing background to the EU’s attempts region where it is almost deprived of influence. to profile itself as a supporter of the protest The strategic importance of Syria to Russia movement. This puts EU sanctions policy more does not only emanate from the lucrative in tune with its programmatic intention to weapons deals it secures, but also from being promote democracy and human rights – a the host of Russia’s only maritime base in the departure from its earlier practice in the Arab Mediterranean. Losing Syria, Russia’s last World, where it had exclusively wielded stronghold in the Middle East, would be a sanctions in support of anti-terrorism and non- major psychological and reputational setback. proliferation goals. On the other hand, the EU is Furthermore, Moscow has a principled simultaneously aligning itself with regional reluctance to be seen as supporting “regime powers which resist the spread of democracy in change” against a long-standing associate, the Middle East, such as Qatar and especially especially as Russia’s allies elsewhere expect to Saudi Arabia. be reassured of unwavering Russian support in the face of Western pressure. The Syrian sanctions package has had the effect of aligning the EU and the US closely in Other powers occupy a middle position an encouraging example of effective transatlantic somewhere between the transatlantic and the collaboration: after some initial disagreements Russian stance. The stance of other BRICS about the scope of the arms embargo, the countries has become evident thanks to their measures agreed by the EU almost perfectly membership of the UNSC in the period match those put in place by the US. This 2011/12. Brazil, South Africa and India, who coincidence prevents a situation in which served in the UNSC as the Syrian crisis European companies can take over trade links unfolded, abstained from a draft resolution previously entertained by US companies – condemning Syrian repression in October something that is now being done by non- 2011. Last year’s experience in Libya showed Western operators. Also, the sanctions operation how a UNSC mandate authorising force in against Syria contributes to the US objective of application of the doctrine of the containing Iran, who is the target of a parallel “Responsibility to Protect” could be used by

EGMONT Royal Institute for International Relations 5 external powers to launch a fully-fledged war. partnerships remains hardly noticeable – an This has tempered the BRICS’ appetite to outcome that puts into question the very endorse mandates along similar lines. By raison d’être of these partnerships. holding back from a UNSC resolution, BRICS are siding with each other in resisting new SYRIA AND THE FUTURE OF EU action cementing the admissibility of SANCTIONS POLICY intervention to address internal repression. The analysis that the combined EU and US Nevertheless, an evolution is visible. Having sanctions against Syria are causing considerable grown increasingly condemnatory of Syrian damage to the economy is unusually repression, India and South Africa supported a consensual – even though, at the time of resolution last February similar to the failed writing, its impact on the power balance in draft of October 2011, which was eventually Syria and on the course of the crisis is difficult vetoed by Russia and China. In turn, the shift to ascertain. The irony about EU energy in India’s and South Africa’s votes has sanctions is that only extremely pressing apparently compelled veto-bearing countries to situations such as violent government somewhat distance themselves from Damascus repression entailing growing civilian casualties (Traub 2012). While China has consistently garner sufficient support for the swift adoption vetoed UN resolutions alongside Russia, its of strong measures like energy bans or condemnation of the Syrian government has embargoes on oil extraction equipment. And become harsher. If Moscow was to relax its yet, because these measures require some time opposition, Beijing would likely be reluctant to to produce sufficient damage to encourage wield its veto, especially given that its interests concessions, they are ill-suited to address are not directly involved. The recent situations requiring an urgent fix such as the proliferation crises in Iran and North Korea current crisis in Syria. have seen China agreeing to sanctions, privileging regional stability and its image as a Which future does the current response to “responsible power” over its traditional Syria herald for EU sanctions policy? The adherence to the principle of non-intervention sanctions package against Syria demonstrates (Oertel 2011). that the EU is able to surmount the main structural deficiency of its sanctions, namely The BRICS positioning around the Syrian the weakness of its measures in terms of the issue suggests that the EU’s strategic little disutility they cause (Portela 2010). partnerships have not been of much use in Notably, the package includes import and winning the support of emerging powers. export bans damaging some European Russia, a strategic partner, constitutes the main business interests, a feature it shares with the obstacle hindering sanctions, while Turkey, Iran sanctions. The reluctance to affect trade both a key regional power and a NATO ally constituted so far a “red line” that had hardly which does not enjoy such status, has resolutely ever been crossed in the absence of a UNSC aligned itself with the EU and the US. mandate, with the exception of the special case Disappointingly, the communiqué of the most of the arms trade. Moreover, trade bans such recent EU-China High-Level strategic dialogue as the prohibition to import gems from does contain one single reference to Syria Myanmar were bound to have only negligible (European Union 2012). In sum, the reaction economic impact for European companies. By of regional and global powers to crises like the contrast, we are now witnessing how security one in Syria remains mostly driven by interests interests trump commercial advantage. Also, alien to the policy preferences of the EU, the speed with which the whole package was whose influence through its strategic agreed was remarkable for EU standards: in

EGMONT Royal Institute for International Relations 6 the past, sanctions regimes were tightened very REFERENCES slowly, with upgrades often consisting in the Council of the European Union (2012) “The EU mere lengthening of existing blacklists. For an and Syria: Fact Sheet”, Press Release, 20 August entity believed to be too unwieldy to frame a 2012. credible sanctions policy only a few years ago, Balfour, R. (2012) “EU Conditionality after the the EU’s crafting of sanctions has been Arab Spring”, Papers IEMed 16, EIMed: remarkably speedy and broad – particularly in Barcelona. European Union (2012) “Joint Press release after view of the block’s growing membership and the 3rd EU-China High-level Strategic Dialogue”, the persisting unanimity rule under which the A318/12, Brussels, 10 July 2012. CFSP operates. Landis, J. (2012) “The Syrian Uprising of 2011: Why the Assad Regime is likely to survive to Sadly, the fact that the EU incorporates 2013”, Middle East Policy, 19(1), 72-84. selective trade bans in its sanctions has Mahony, H. (2012) “EU Ministers set to beef up distressing implications. Firstly, it signifies a Syria arms embargo”, EUObserver, 20 July 2012. move away from the narrowly targeted Norman, L. (2011) “EU set to broaden Syrian sanctions that impeccably characterised EU sanctions”, Wall Street Journal, 11 November sanctions policy. Because assets freeze and visa 2011. bans are based on a blacklist, they single out Oertel, J. (2011) “China und das Sanktionsregime der Vereinten Nationen”, SWPAktuell 23, April those individuals and entities held to bear 2011. responsibility for misbehaviour. By contrast, Portela, C. (2010) European Union Sanctions and selective embargoes affect entire sectors and Foreign Policy, Routledge: London. are those more likely to disadvantage Traub, J. (2012) “Will the good BRICS please stand individuals bearing no responsibility for the up?”, Foreign Policy, 9 March 2012. condemned policies. Finally, while the blacklists Walker, J. (2012) “Turkey’s Syrian Dilemma”, EPC did not pose any major obstacle to bilateral Commentary, 9 July 2012. trade with targets, the inclusion of trade Dr Clara PORTELA is Assistant Professor restrictions will do little to increase the of Political Science at Singapore popularity of a sanctions regime widely Management University (Singapore). She regarded as a poor substitute for an unlikely was a visiting fellow at Egmont in the military intervention. spring of 2012. The author thanks Thomas Renard, André Endnotes Bank, Sven Biscop, Rosa Balfour and 1 Figures for 2010, http://exporthelp.europa.eu, Dursun Peksen for their input and [accessed 30 July 2012] 2 For the text of the legal instruments, consult comments. http://eeas.europa.eu/cfsp/sanctions/docs/measures_e n.pdf, in particular Council Decisions 2011/782/CFSP, The Security Policy Brief is a publication of Egmont – Royal 2012/122/CFSP and 2012/206/CFSP. Institute for International Relations 3 Figures from SIPRI Arms Transfers Database, http://www.sipri.org/databases/armstransfers, [accessed EGMONT 30 July 2012] Royal Institute for International Relations 4 Figures for 2011, http://ec.europa.eu/trade/creating- Naamsestraat 69 opportunities/bilateral-relations/countries/syria/, 1000 Brussels [accessed 30 July 2012] BELGIUM 5 Ibid. 6 Figures from EIB, > www.egmontinstitute.be http://www.eib.europa.eu/attachments/country/syria_2 012_en.pdf, [accessed 30 July 2012] The opinions expressed in this Policy Brief are those of the authors and are not those of EGMONT, Royal Institute for International Relations

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