RUSSIAN AGGRESSION IN UKRAINE AND INTERNATIONAL SANCTIONS

Abstract

In this article, various aspects of the international sanctions against Russia for its aggression in Ukraine are analyzed with the well-known model by Eaton and Engers (1999), which explains mechanisms of sanctions involving two parties, the sender and the target, with the use of the theory of repeated games and bargaining under incomplete information. It is demonstrated that economic sanctions are effective in the case when countries-initiators are able keep restrictions for quite a long period of time. It is even more important if compared with the economic losses of sanctioned countries which can be quite resilient to international pressure. In reality the so-called stubborn target countries have incentives to balk due to insufficient commitment of the sender countries to a sanctions regime. In such context, insufficient effectiveness of international sanctions against Russia can be related to the lack of determination and unified position among countries-initiators of the regime of international sanctions. Such a situation can be explained (at least in part) by intentions to test the reaction of Russian authorities, but there are reasons to assume that important differences between interests of countries which introduced the regime of sanctions have played an important role. Over the 2024–2025 period, the European Union (EU) countries have tightened their sanctions against Russia significantly, but the expected effect is substantially weakened by the U-turn in the position of the USA since the election of Donald Trump as the US President in November 2024. Effectiveness of anti-russian sanctions is suffering because of the lack of either reliable monitoring of the sanction regime or secondary sanctions against countries which used to help Russia in avoiding all kind of restrictions. Theoretical arguments and applied analysis of the sanction regime developments provide with evidence against the practice of prolongation of sanctions on a six-month basis (half-year), as it has been practicing by the EU countries, because it undermines credibility of the sanctions regime. If sanctions are assumed to be effective, it is better to impose them on the indefinite basis, when unanimity is required for lifting (or weakening) of them in the future. In such a context, the EU decision of December 12, 2025 to indefinitely freeze 220 bn of Russian central bank assets held in Europe is a step in the correct direction.