The Redistributive Impact of Restrictive Measures on EU Members: Winners and Losers from Imposing Sanctions on Russia

Abstract

EU sanctions on Russia created concerns among its members. It is well known that sanctions impose a cost on their targets as well as on the senders, as lamented by European governments, but the costs of EU sanctions on its members have not been fully explored. This article intends to fill this gap by looking at the cost of EU sanctions on Russia. Who is bearing the cost among EU countries? This article argues that sanctions had a redistributive impact across the EU. Whereas exports fell for all countries, with Germany, Italy and Finland in the leading positions, the article shows that there are economic sectors that increased their exports to Russia after the imposition of sanctions, which occurred particularly in countries as Greece, Sweden, Luxembourg and Bulgaria. This conclusion is reached by looking at the export flows from individual EU member states divided by SITC sectors to Russia.

The War in Europe: Economic Costs of the Ukrainian Conflict

“…Third, although sanctions' costs are difficult to identify and disentangle from countries' performance, the analysis of export data suggests that only few of our control countries experienced changes in exports that may be attributable to these sanctions. Specifically, a study by Giumelli (2017) finds that, on the one hand, exports of Germany, Italy, France, the Netherlands and Poland seem to be especially hit by the sanctions, with the most severe drop in 2015 compared to 2013. On the other hand, exports of Slovenia, Luxembourg and Romania were affected the least.…”

Consensus against all odds: explaining the persistence of EU sanctions on Russia

“…Signs of resistance to the sanctions package surfaced soon after imposition, suggesting they might be short-lived. Criticism was voiced by members of the executive in various EU member states (Giumelli 2017). In the years that followed the enactment, then-Spanish Foreign Minister José-Manuel García-Margallo declared that sanctions were 'beneficial for no one' (Rettman 2015).…”

“…(Interview 9 2020). This argument about leaders' criticisms of the sanctions being voiced for domestic consumption dovetails with the apparently puzzling fact that those leaders who complain most vocally tend to represent those countries that have suffered the least (Giumelli 2017;Moret et al 2016). Secondly, the impact of Level II on Level I shows that consensus is a function of domestic politics in which decision-makers need to balance security and economy considerations (e.g.…”

Lilliput Effect Revisited: Small States and EU Foreign Policy

“…The annexation of the Crimean peninsula and the outbreak of the conflict in Eastern Ukraine led the EU, in March 2014, to impose its first restrictive measures on Russia. Later, in August, following the shooting down of flight MH457 and further Russian incursions into Eastern Ukraine, the EU decided to adopt more comprehensive economic sanctions, excluding Russian companies from the EU capital markets and banning the export of arms and dual-use goods, as well as goods used in the ongoing energy projects in the Arctic (Giumelli 2017).…”