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Sanctions and countersanctions − effects on economy, trade and finance


  • Iikka Korhonen


  • Heli Simola
  • Laura Solanko


In this paper we review the history and current state of sanctions imposed on Russian entities by the EU, the U.S.A. and others, as well as Russia’s countersanctions. We try to assess what kind of economic effects these measures have had, although any such analysis is bound to be confounded by the large drop in the price of oil that occurred in 2014 and 2015. We find that sanctions have had a clear, negative effect on the Russian economy, although the decline in the price of oil affected Russian GDP much more strongly in 2014−2016. The U.S. and EU sanctions have worked e.g. by restricting Russian banks’ access to capital. EU countries’ trade with Russia and their market share in Russia have declined, but this is partly a continuation of a long-term trend. Russia’s countersanctions have e.g. affected exports of foodstuffs from the EU, but macroeconomic effects in the EU are very small.

Suggested Citation

  • Iikka Korhonen & Heli Simola & Laura Solanko, 2018. "Sanctions and countersanctions − effects on economy, trade and finance," Focus on European Economic Integration, Oesterreichische Nationalbank (Austrian Central Bank), issue Q3-18, pages 68-76.
  • Handle: RePEc:onb:oenbfi:y:2018:i:q3-18:b:6

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    References listed on IDEAS

    1. Crozet, Matthieu & Hinz, Julian, 2016. "Friendly fire - the trade impact of the Russia sanctions and counter-sanctions," Kiel Working Papers 2059, Kiel Institute for the World Economy (IfW).
    2. Oliver Fritz & Elisabeth Christen & Franz Sinabell & Julian Hinz, 2017. "Russia's and the EU's Sanctions. Economic and Trade Effects, Compliance and the Way Forward," WIFO Studies, WIFO, number 60669.
    3. E. Gurvich & I. Prilepskiy., 2016. "The impact of financial sanctions on the Russian economy," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 1.
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    Cited by:

    1. Pestova, Anna & Mamonov, Mikhail, 2019. "Should we care? : The economic effects of financial sanctions on the Russian economy," BOFIT Discussion Papers 13/2019, Bank of Finland, Institute for Economies in Transition.
    2. Marek Dabrowski, 2019. "Factors determining Russia's long-term growth rate," Russian Journal of Economics, ARPHA Platform, vol. 5(4), pages 328-353, December.
    3. Iikka Korhonen, 2020. "Economic Sanctions on Russia and Their Effects," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 20(04), pages 19-22, January.

    More about this item


    Russia; sanctions;

    JEL classification:

    • F51 - International Economics - - International Relations, National Security, and International Political Economy - - - International Conflicts; Negotiations; Sanctions


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