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UNITED
NATIONS
A

        General Assembly
Distr.
GENERAL
A/66/138
14 July 2011

English
Original: Arabic/English/Spanish

Sixty-sixth session
Item 18 (a) of the preliminary list*
Macroeconomic policy questions: international trade
and development

Unilateral economic measures as a means of political and economic coercion against developing countries


Report of the Secretary-General


Summary

In its resolution 64/189, entitled “Unilateral economic measures as a means of political and economic coercion against developing countries”, the General Assembly requested the Secretary-General to continue to monitor the imposition of such measures, to study their impact on the affected countries and to report to the Assembly at its sixty-sixth session on the implementation of the resolution. The present report reflects the replies of Member States and selected international organizations (see annexes I and II) to the note verbale sent by the Secretary-General requesting pertinent information. The report also includes additional data collected by the Secretariat.

The responses from Member States indicated their disagreement with the imposition of unilateral economic measures as instruments of political and economic coercion against developing countries. Such actions are not viewed as being in accordance with the principles of the Charter of the United Nations, the norms of international law or the rules-based multilateral trading system, moreover, they are perceived as to be undermining the sovereign equality of States. Member States affected by such measures stressed that unilateral measures have an extraterritorial dimension, since they extend the application of domestic laws to other countries. Member States expressed concern about the negative impact of unilateral economic measures on the socio-economic development of the affected countries. The Economic and Social Commission for Western Asia, the United Nations Conference on Trade and Development and the Organization for Economic Cooperation and Development reported that unilateral sanctions tend to adversely affect populations in the affected countries and to hamper international trade.




* A/66/50.


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I. Introduction

1. The present report is submitted pursuant to General Assembly resolution 64/189, entitled “Unilateral economic measures as a means of political and economic coercion against developing countries”. In that resolution, the Assembly, inter alia, urged the international community to adopt urgent and effective measures to eliminate the use of unilateral coercive economic measures against developing countries that were not authorized by relevant organs of the United Nations or were inconsistent with the principles of international law as set forth in the Charter of the United Nations and that contravened the basic principles of the multilateral trading system.

2. In the same resolution, the General Assembly requested the Secretary-General to continue monitoring the imposition of such measures, to study their impact on the affected countries, including the impact on trade and development and to report to the Assembly at its sixty-sixth session on the implementation of the resolution.

3. Accordingly, the Secretariat, in a note verbale dated 4 April 2011, invited the Governments of all Member States to provide their views and any other relevant information regarding the existence of any unilateral sanctions and the impact they may have had on national trade and development. As a result of the introduction of a short questionnaire by the Secretariat, in order to facilitate the responses from countries, a greater number of countries replied compared to the previous exercise, when only four Member States responded to the request by the Secretary-General. As of mid-June 2011, 18 Member States (Armenia, Brunei Darussalam, Colombia, Cuba, Egypt, Gabon, Guatemala, Lebanon, Malaysia, Malta, Mauritius, Mexico, Myanmar, Oman, Qatar, the Sudan, Ukraine and Viet Nam) had replied to the request. Those replies are reproduced in annex I to the present report. The information presented in section II has been provided by respondents and has not been verified with other sources.

4. Relevant organizations, programmes and agencies inside and outside the United Nations system were also invited to provide information and analyses concerning recent developments in the subject area. The Economic and Social Commission for Western Asia (ESCWA), the United Nations Conference on Trade and Development (UNCTAD) and the Organization for Economic Cooperation and Development (OECD) responded to that invitation. The replies received from those organizations are reproduced in annex II to the present report.

II. Summary of replies received from Member States, United Nations bodies and international organizations

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8. A summary of latest developments in three of the economies monitored by ESCWA, the Occupied Palestinian Territory, the Sudan and the Syrian Arab Republic, was provided by the Commission. Restrictions on mobility and an economic blockade are still in effect in the Gaza Strip. Heavy restrictions on imports to the Occupied Palestinian Territory have led to shortages of basic commodities required for maintaining the standard of living of the local population, and export restrictions have curtailed trade. ...

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9. UNCTAD provided a summary of the latest developments related to trade by countries currently affected by unilateral sanctions, including Belarus, Cuba, the Democratic People’s Republic of Korea, the Islamic Republic of Iran, the Libyan Arab Jamahiriya, Myanmar, the Occupied Palestinian Territory, the Sudan and the Syrian Arab Republic. While the scope of measures applied to the countries concerned varies, major impacts include a loss of trade and foreign exchange earnings, a reduction in productive capacity and employment and a deterioration of the economic and social welfare of the population, in particular among middle and lower income groups. In its reply, OECD indicated that it supports a smooth functioning of the rules-based multilateral trading system under which economic sanctions are enacted following a dispute settlement ruling.

III. Monitoring the imposition of unilateral measures and studying the impact of such measures on the affected countries

10. According to the publication written by researchers at the Peterson Institute for International Economics,1 there have been 23 new cases of unilateral economic measures since 2000. Eighteen of the new cases were initiated after 2000, while five cases refer to the introduction of new actions in the long-standing instances of Cuba, the Democratic People’s Republic of Korea, the Islamic Republic of Iran, Myanmar and the Occupied Palestinian Territory. ...

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Annex II

Replies received from United Nations bodies and international organizations

Economic and Social Commission for Western Asia


[Original: English]
[3 May 2011]

The contribution of the Economic and Social Commission for Western Asia (ESCWA) to the report of the Secretary-General on unilateral economic measures as a means of political and economic coercion against developing countries is submitted herewith.

The imposition of punitive measures, including sanctions, impinge upon the entire populations of developing countries, but they may not always reach their intended targets. This “collective punishment” places significant burdens on the citizenry of the targeted countries, including children. Such measures lead to falling incomes, which directly affect progress towards the achievement of the Millennium Development Goals owing to their negative impact on national budgets. These actions are also contrary to the General Assembly resolution 64/189.

The Commission has the following observations to make on countries affected by economic sanctions in the ESCWA region during the 2008-2010 period as follows.

Target countries
Nature of sanction

Country imposing sanction

Date sanction was imposed

Sanction still binding?
Occupied Palestinian Territory Mobility restrictions and economic blockade (Gaza Strip) Israel Mobility restrictions 2000
Economic blockade: June 2007 (Gaza Strip)
Yes
/...

ESCWA reports the impact of the above sanctions on the country, including on its trade and development as follows:

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Occupied Palestinian Territory

Restrictions on the economy and restrictions on movement have heavily affected Palestinians in every area of society. The economy has become heavily dependent to both foreign aid and the Israeli economy. Oppressive restrictions on imports have led to shortages of many basic commodities required for maintaining an adequate standard of living. Export restrictions have also curtailed trade with the outside world, and have ensured Israeli hegemony over the Palestinian economy. Unemployment remains worryingly high, and has forced the authorities to hire staff at a lower-than-average rate just in order to prevent skyrocketing labour force marginalization. Progress towards the realization of the Millennium Development Goals remains problematic in the face of budgetary, institutional and infrastructural constraints, which can be directly attributed to the imposition of the above-mentioned restrictions.

The economic and trade blockade of the Gaza Strip has had significant ramifications on trade and development. Both import and export restrictions severely curtail trade not just with the outside world but also with the West Bank and East Jerusalem. Strict controls on “dual use” imports have also led to a lack of infrastructure, which was already in poor condition. As a result, the water and electrical supply has deteriorated, significantly impeding economic and, hence, employment-generating activities. The impact on the citizenry, which is both negative and widespread, has led to adverse effects on education and health (including psychological), including income levels.

In addition, ESCWA comments that:

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• The most severe case of unilateral sanctions is the blockade imposed by Israel on the Gaza Strip. This blockade not only violates the principles of international law that are relevant to international trade, but it also violates other aspects of the Fourth Geneva Convention, namely article 33, which prohibits collective punishment.

United Nations Conference on Trade and Development


[Original: English]
[12 April 2011]

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UNCTAD has observed countries affected by economic sanctions during the 2008-2010 period as follows:

Target country Nature of sanction Country imposing sanction Date sanction was imposed Sanction still binding?
/...
Occupied Palestinian Territory Israeli closure policy imposed in the West Bank, and economic blockade on the Gaza Strip since mid-2007. In addition, the construction of the separation barrier in the West Bank by Israel increases the economic isolation and fragmentation of the Occupied Palestinian Territory Israel Closure policy imposed on the Occupied Palestinian Territory in mid-1990, but intensified in September 2000. Construction of the separation Barrier in the West Bank commenced in 2002 (almost completed). Blockade of Gaza Strip started in June 2007 Yes

UNCTAD describes the impact of the above sanctions on the countries, including on its trade and development, as follows.

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Since 2000, Israel has intensified its closure policy, a policy that restricts the movement of people and goods within, to and from the Occupied Palestinian Territory. This has fragmented what is left of the economy into isolated islands and has substantially increased transaction costs and restricted access to global markets. Many existing businesses have become redundant and potential investments have vanished. At least one third of the 1998 Palestinian productive base (factories, farms, trees, buildings and land) was not replaced after it was destroyed, or simply deteriorated, during recurrent confrontations. The 709 kilometre “separation barrier”, which is presently being constructed, and is near completion, by Israel, has resulted in the confiscation of 15 per cent of the West Bank’s most fertile land, while Israel’s security policy has limited fishermen’s access to the sea and rendered 30 per cent of arable land in Gaza inaccessible to farmers. The cost of the December 2008/January 2009 Israeli military offensive on Gaza is slightly below $4 billion (almost three times the size of gross domestic product (GDP) of Gaza in 2006). The cumulative effect of these policies translates into a more than 14 per cent drop in real per capita GDP between 1999 and 2009, extremely high poverty and unemployment rates and deepening dependence on foreign aid and on the Israeli economy. It is estimated that the Palestinian exports in 2009 are 40 per cent below the 1999 level. The trade deficit continues to represent 60 per cent of GDP; more than 66 per cent of the overall deficit is net import from Israel. The latter is larger than the $2.4 billion in donor support received by the Palestinian Authority in 2009. All of these factors are undermining the prospects for a future viable and sovereign Palestinian state.

While the scope of the coercive measures applied to the countries concerned varies, the major impact is felt in loss of trade and foreign exchange earnings, reduction in production capacity and employment, limited access of the population to goods and services including health, education, science and technology, higher costs of transactions, lower living standard and lack of opportunity to integrate into a non-discriminatory and open international trading system.

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Endnote
1Hufbauer, Gary Clyde, Jeffery J. Schott, Kimberly Ann Elliott, and Barbara Oegg, 2008, Economic Sanctions Reconsidered. The publication has been updated by Gary Hufbauer and Julia Muir.


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