From Fox News
BEIJING — China, the biggest buyer of Iran’s oil, has publicly rejected U.S. sanctions aimed at Tehran’s energy industry while American allies Japan and South Korea are scrambling to find a compromise to keep critical supplies flowing.
Beijing is buying less Iranian crude this month, but analysts say China is unlikely to support an oil embargo. Instead, they say, the smaller purchases might be a tactic aimed at obtaining lower prices as the West squeezes Tehran.
The sanctions approved by President Barack Obama on New Year’s Eve have higlighted the importance of Iranian oil supplies to East Asia’s energy-hungry economies. They have led to a clash of interests between Washington and key commercial and strategic partners over efforts to stop Iran’s nuclear program.
“We are considering our response and are closely discussing the matter with the U.S.,” a Japanese Foreign Ministry official, Kazuhiro Kawase, said Friday.
A South Korean foreign ministry spokesman said this week Seoul is in talks with Washington aimed at “minimizing the negative impacts” of sanctions. South Korea imports 97 percent of its oil and depends on Iran for up to 10 percent of its supplies.
I’ve railed against this before in passing, especially since the talks have picked up from the Obama administration and GOP candidates.
When soft power, or means other than military action, is used to curtail a country’s behavior, such as sanctions, the intended results are largely over inflated.
We have withheld trade from China, Cuba, Iran, (then) Soviet Union, and numerous other countries. In almost all cases the country being sanctioned bought from countries in Europe or Japan. Cuba has proven to be durable in face of impenetrable sanctions. The people of Cuba have went without but the government endured and the sanctions have hardly sped up the democratization process on the island. The case is the same for Iran. They could be living better but the people are not going totally without, especially considering their biggest oil customers are Japan and Germany.
The U.S. can inflict hardship but rarely enough to make the target country’s government buckle and collapse. Furthermore, sanctions hurt productivity and the economy at home. In 1995, $20 billion of exports and nearly 300,000 jobs were lost at the expense of sanctions and trade policies in the U.S. (Business Week, 17 November 1997, p. 115).
The World Economy says this about economic sanctions against China in 2004
The United States maintains a broad spectrum of economic sanctions against China ranging from export controls to prohibitions on certain imports. Our study finds that, although from a macroeconomic perspective, US sanctions have had no significant adverse effect on China’s overall economic growth and trade between the two countries, they do have a negative impact on producers and consumers in both countries. US economic sanctions have hindered technology transfer to China and US investment in China. US restrictions on imports from China have caused deadweight losses for the US due to higher domestic production costs for import substitutes and a reduction in consumption. US export controls have hindered US exports to China and contributed to large US trade deficits with China. The export controls have also caused losses of high-paid jobs in the United States and benefited competitors from other countries. In addition, US economic sanctions against China have had significant third-party effects. China’s diversification of imports to sources other than the United States may have a long-term effect on US exports to China even after US economic sanctions against China are lifted.