The Crimea crisis has raised the issue of whether or not economic sanctions have become more important in foreign policy and diplomacy given the increased globalization and inter-connectedness of the global system. More so since the 2008 Georgia crisis and the increased U.S. experience with the Iranian sanctions. “Crimea: Globalization and Economic Sanctions.” Financial Times (March 4, 2014). The United States is thinking about using its new energy (natural gas) production and exports as a trade weapon in its foreign policy and diplomacy aimed at Russia. “Energy and Diplomacy — U.S. & Putin (Crimea).” New York Times (March 6, 2014). Some consider sanctions against individuals only are more like painless drone attacks (“Magnitsky” type of illusions) rather than more significant financial sanctions against major financial institutions (government and private). “Londongrad and Financial Sanctions.” Financial Times (March 6, 2014).
However, more serious economic sanctions by either the EU or the U.S. can backfire. Imposing serious consequences not only on Russia but also on U.S. and European firms as well as the international financial system. This seems strange since the EU and the U.S. spent years trying to integrate the Russian Federation into the WTO, the global trade and international financial systems.