the Success of the Eu Sanctions: Russia as a Case Study

European Union engages with countries from various regions of the world at various levels. These relations range from neighborly relations to commercial relations. The EU uses both reward and punishment mechanisms against these countries. Sanctions are one of the EU's most frequently used instruments. Sanctions can be considered as an important deterrent power of the EU. It is important that this instrument works effectively. Because the EU has limited deterrent tools for countries. One way for the reward instrument to work is for the sanction instrument to succeed. This is because the strength of EU co-operation and integration also comes from the effectiveness of the mechanisms it uses. For this reason, in this study, the sanctions used by the EU against Russia will be analyzed and whether they have an impact on the Russian economy will be revealed. The EU imposed sanctions because of Russia's policy towards Ukraine. The EU decided to impose the first set of sanctions against Russia since the end of the Cold War. It was therefore an important step for this bilateral relationship. The first phase of sanctions was adopted at the beginning of March 2014. Negotiations with Russia on visa issues as well as negotiations on a new treaty were suspended. On 17 March 2014, new sanctions were adopted. The Council decided to introduce additional measures, including travel restrictions and freezing of assets in the EU, against persons responsible for actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine. Comprehensive sanctions were adopted in July 2014. In order to restrict Russia's access to EU capital markets, EU citizens and companies are prohibited from buying or selling new bonds, stocks or similar financial instruments over 90 days old issued by state-owned Russian banks, development banks, their subsidiaries outside the EU and those acting on their behalf. Services related to such financial instruments are also prohibited. There is also an embargo on the import and export of arms and related materials from/to Russia. In addition, the export of dual-use goods and technology for military use or military end-users in Russia is prohibited. Finally, the export of certain energy-related equipment and technologies for some projects in Russia is prohibited. EU sanctions have been strengthened and extended several times from 2014 to 2023. In the empirical part of the study, the impact of the EU sanctions on the Russian economy is investigated through econometrical analysis. Synthetic control method is used to analyze annual frequency data covering the period 1998-2023. This method is applied to measure whether the interventions to the analyzed elements are successful or not. In the present study, the intervention instrument was sanctions. Macroeconomic data on GDP, trade volume, public expenditures, inflation rate, income distribution as well as demographic data on population were included in the analysis. As a result of the analysis, it was found that sanctions negatively affected Russia’s macroeconomic indicators. This shows that the EU, which has limited deterrent tools, can achieve a good effect with sanctions.