Bloomberg: US Sanction Power Reaching Its Limit?

The United States withdrew from the Iran nuclear deal known as the Joint Comprehensive Plan of Action and plans unilateral sanctions. Ben Holland of Bloomberg News identifies a pattern: the Trump administration’s increasing reliance on sanctions and disdain for diplomacy. Other major economies, especially the European Union, China and India may be weary of US demands that increase their costs. “The dollar is the world’s currency, and Wall Street remains a key financial center, which helps U.S. leaders sway friends and coerce rivals,” notes Holland. However, “In the past five years, China has set up its own lending institutions parallel to the Washington-based World Bank and International Monetary Fund and pushed the yuan as an international currency. The country is likely to strengthen its presence in Iran no matter what Trump does.” Analysis reveals both targets and countries imposing sanctions shoulder burdens. Capriciousness and bossiness may erode international power of the US financial system. – YaleGlobal