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Economic Sanctions: (EAC Report)

My Lords, we are very fortunate in our committee in having in my noble friend Lord Wakeham and Robert Graham-Harrison a chairman and a Clerk who could not be bettered. I thank them both for their help to the committee as a whole in what has proved to be a very timely report and, now, this debate. Incidentally, I agree wholeheartedly with the—admittedly, rather restrained—way in which my noble friend referred to the Government’s lamentable reply. I listened with great attention to the noble Lord, Lord Hannay, who seemed to exemplify in the most high-minded way all the major misconceptions about this issue. Fundamentally, when we are formulating policy, whether it is foreign or economic policy or anything else, we have to do so in the context of the world as it is and not as we would wish it to be. It would be very nice if there were a rung on the ladder between, on the one hand, doing nothing or taking nothing more than diplomatic action and, on the other, military action. Although there is a whole spectrum of military action, following Iraq, we think that it must mean invasion and occupation. However, it does not; there is a whole range of military action that comes well short of war. Nevertheless, the noble Lord is right that there is still a big gap in the ladder between doing nothing and taking military action. It would be very nice if there were something which filled that gap and worked. The trouble is that there is not, and wishing that there were does not make it so. All experience shows that economic sanctions, however well intentioned, do not work. They are invariably harmful to the countries that are sanctioned and are frequently counterproductive. Let us take the example of Cuba, mentioned by the noble Lord, Lord Hannay. He admitted that sanctions in Cuba have been counterproductive and seemed to imply that it was because they were unilateral, but that is not the reason. They are counterproductive because they have given President Castro an excuse for the lamentable failures of the Cuban economy and the appallingly low living standards of the Cuban people. Before Castro, living standards in Cuba were among the highest in the whole of Latin America. They are now among the lowest because of the communist economic policies followed by President Castro, which have not been a great success anywhere in the world where they have been tried. But he is able to say, ““Look at what America and the world have been doing to us with economic sanctions””. That is a large part of the problem. As the purpose of economic sanctions is to damage the economy, it is very difficult to say that they have had no impact at all. It is as certain as anything can be that Castro would not have lasted these past 40-plus years had it not been for the Americans’ economic sanctions. The Americans know that too, and that brings us to another point which is characteristic of economic sanctions. The Americans know that such sanctions are completely useless and counterproductive, so why do they maintain them? They do so because of the Cuban émigré population in Florida—an important domestic constituency, which would be outraged if the sanctions were lifted. Generally, economic sanctions tend to be imposed not because of an objective view that, in the light of experience, they are likely to achieve their objective—they are not; experience shows the complete reverse—but because there is pressure from either a part or a large sector of the electorate in the sanctioning country that something must be done. Sanctions are applied in response to that. Understandably, there is reluctance to take military action, so the ““something”” tends to be economic sanctions—not because they are thought to be effective but as a response to domestic political pressure. In my judgment, that is not a good reason for imposing them. There is also a point concerning exit strategy, referred to by my noble friend Lord Wakeham, in the context of a regime complying sufficiently to enable sanctions to be lifted. However, in my judgment, there is a rather more serious problem relating to exit strategy about which we need to think long and hard. The noble Lord, Lord Hannay, asked how we could now possibly lift sanctions against Burma, even if they are not doing any good, in the light of what we have seen recently on the streets of Rangoon and elsewhere. That is precisely the point: you are stuck. Once you impose them, you cannot exit because it is seen as a great triumph for the despotic regime which has been ineffectually sanctioned. You are stuck with continuing with the sanctions, even though they are not merely having no effect at all but harming the population. I have no complaint against inflicting some economic hardship on the populations of the countries that have been sanctioned. Economic sanctions must do that; there is no way that they can avoid it. There is a curious piece in the Government’s response to the report. In the case of Iraq, they say rather plaintively that, "““it was the Iraqi regime … who remain squarely to blame for the misuse of resources which was instrumental in causing humanitarian suffering among the general population””." Did the British Government seriously think that, when sanctions were imposed against Iraq, Saddam Hussein would say, ““Well, we’ve got to tighten our belts. In order to build all the hospitals that are required, I am going to disband the security services, the secret police and the Republican Guard””? No; clearly, when there are economic sanctions, the regime will maintain its spending on whatever is necessary to prop up and support that regime, and the ordinary people will suffer. You cannot seriously embark on sanctions without understanding that that is the inevitable result. I return to the question of the exit regime. If causing hardship among the population for a time would ultimately result in the toppling of a despotic regime and far better political and economic conditions for the people, that would be all well and good. However, if it does not result in that, there is no justification whatever for imposing such hardship on the people. You have to be pretty sure that you will have a successful result—which, in my judgment, you cannot be sure of—before you inflict that harm on the people. That harm will go on and on because, as the noble Lord, Lord Hannay, said, once you have imposed sanctions, you cannot lift them. It is that simple and it is another reason why sanctions do not work. Let us take another case—Zimbabwe—where there have been no sanctions, but it illustrates the nature of the nonsensical position we are in. We do not need to impose sanctions on Zimbabwe to damage its economy. Mr Mugabe has done that all on his own. Yet the equation is very similar. If he were to give up, it is clear that there would be an international rescue operation to rescue the Zimbabwean economy, so there is huge economic gain from him stepping down and his ghastly regime going away. Do we think that that will happen as a result of the weakness, to say the least, of the Zimbabwean economy? Of course not. If popular disaffection with regimes and economic hardship caused political change, these changes would have happened already in Zimbabwe, Cuba or wherever. But it does not happen. To add to that, and to acquire culpability in the eyes of many in the world through doing it, does not seem a sensible policy, nor does it in the case of Burma, where one of the principal effects of the sanctions has been not merely to harm the Burmese people but to throw the Burmese Government more and more into the arms of China. That is not a great foreign policy triumph either. We must live in the real world. It would be lovely if we lived in a world where there was not this missing rung of the ladder. It would be lovely if economic sanctions worked, but experience shows that they do not. They are damaging and counterproductive. The sooner we accept that and persuade our fellow members of the European Union to accept that as a common European position, the better.