Sanctions Evasion In Central Asia

The countries of Central Asia and other members of the Eurasian Economic Union (EAEU) and the Commonwealth of Independent States (CIS) as a tool to circumvent sanctions against the Russian Federation, its legal entities and individuals

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After the begin­ning of the large-scale aggres­sion of the Russian Federation (RF) against Ukraine, a num­ber of demo­c­ra­t­ic states, imposed sanc­tions against Russia, its finan­cial insti­tu­tions, legal enti­ties and individuals. 

The pur­pose of eco­nom­ic sanc­tions is to make it dif­fi­cult for Russia to finance the war in Ukraine and deprive the Russian Federation of the abil­i­ty to con­tin­ue aggres­sion, as well as to demon­strate to rep­re­sen­ta­tives of the Russian polit­i­cal and eco­nom­ic elite that the inva­sion of Ukraine has eco­nom­ic and polit­i­cal con­se­quences. Sanctions have also been imposed on Belarus for sup­port­ing the Russian inva­sion. Individual sanc­tions are direct­ed against those respon­si­ble for sup­port­ing, financ­ing or car­ry­ing out actions that under­mine the ter­ri­to­r­i­al integri­ty, sov­er­eign­ty, and inde­pen­dence of Ukraine, as well as those who ben­e­fit from these actions. After the intro­duc­tion of sanc­tions, the author­i­ties of the Russian Federation and Belarus, state and pri­vate com­pa­nies, as well as oli­garchs who fell under sanc­tions, began to use var­i­ous mech­a­nisms to cir­cum­vent sanc­tions. In the cur­rent sanc­tions’ envi­ron­ment, Russia still has enough room for free maneu­vers. There is a wide range of loop­holes for evad­ing sanc­tions. The Russian author­i­ties use part­ners of Russia – indi­vid­u­als, legal enti­ties, and the gov­ern­ments of the states — strate­gic part­ners of the Russian Federation who are not sanctioned.

Legal and con­sult­ing com­pa­nies in Russia, Central Asia and Western coun­tries offer ser­vices for the relo­ca­tion of busi­ness from Russia to the mem­ber states of the Eurasian Economic Union (EAEU) and the Commonwealth of Independent States (CIS).

The Eurasian Economic Union (EAEU) includes Armenia, Belarus, Kazakhstan and Kyrgyzstan, as well as Russia. The Russian Federation con­trols the EAEU. The EAEU is a free trade bloc that has inter­na­tion­al trade treaties with Iran, Serbia, Singapore and Vietnam and nego­ti­ates with many oth­ers, most notably India and China. The CIS also includes Azerbaijan, Georgia, Moldova, Tajikistan, Turkmenistan and Uzbekistan. This inter­state union func­tions some­what dif­fer­ent­ly than the EAEU, but it pro­vides for par­tial free trade between all mem­bers. For many goods that move to the CIS, there are no export and import duties.

The pur­pose of the ana­lyt­i­cal report is a com­pre­hen­sive study of the issues of cir­cum­ven­tion of sanc­tions by Russia with the help of the Central Asian states, legal enti­ties (orga­ni­za­tions) and indi­vid­u­als (cit­i­zens) of these coun­tries and the pre­sen­ta­tion to the world com­mu­ni­ty of rec­om­men­da­tions to improve the effec­tive­ness of sanc­tions and block the abil­i­ty of the Russian Federation to cir­cum­vent sanctions.

The ter­ri­to­r­i­al focus of the study is the states of Central Asia: Kazakhstan, Kyrgyzstan, Turkmenistan, Tajikistan, Uzbekistan. This choice is deter­mined by the active use of these states to cir­cum­vent sanc­tions and the use of the same type of schemes by the Russian regime in this region. 

In cas­es where the mech­a­nism for cir­cum­vent­ing sanc­tions includes not only the states of Central Asia, but also oth­er coun­tries of the EAEU and the CIS, the authors of the report con­sid­er the entire range of par­tic­i­pat­ing states. The authors of the report believe that in the future opendemocracy it is nec­es­sary to study oth­er region­al groups of states in order to iden­ti­fy mech­a­nisms for cir­cum­vent­ing sanc­tions and block­ing these mechanisms. 

The report was pre­pared on the basis of infor­ma­tion from pub­licly avail­able open sources. 

When work­ing on the report, the authors used a sys­tem of meth­ods for mon­i­tor­ing pub­lic sources and qual­i­ta­tive and quan­ti­ta­tive meth­ods for ana­lyz­ing infor­ma­tion. Wherever pos­si­ble, infor­ma­tion from one source has been ver­i­fied against oth­er sources.

Descriptions of sanc­tions against the Russian Federation, its legal enti­ties and indi­vid­u­als are pub­licly avail­able. For this rea­son, the authors do not describe them in detail in the present report.

The report cov­ers the peri­od from the begin­ning of the Russian aggres­sion in February 2022 to the end of December 2022.

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Обход западных санкций в странах Центральной Азии Скачать на русском языке PDF

The orig­i­nal source of arti­cle: FREEDOM FOR EURASIA