Sanctions are testaments of American supremacy
Contrary to popular belief, it’s not the weapon of the dollar that makes US sanctions against a country inescapable. The Greenback is of course the reserve currency par excellence on the global scale and naturally accounts for the American hegemony. However, doing business in another currency – for the many companies and nations under sanction –isn’t enough to avoid these sanctions. Put another way, because its sanctions are no longer avoidable by using a different currency, it’s not thanks to the dollar that the US reigns.
Let’s take the case of Iran where it has just been inflicted with another battering ram of sanctions by the USA. American companies can now no longer – not just maintain commercial relations with Iran, which is obvious– but also have any contact with European, Japanese, Canadian or other company that might have ties with Iran. Any foreign company doing business with Iran therefore finds itself faced with an impossible choice of being literally banned not just from the US but above all from doing any business with any American company if it decides to continue its relations with Iran. This means that any foreign company resisting this move would be deprived of access to the immense US market, deprived of buying US technology, of the expertise of Silicon Valley, of buying any US shares, of accessing a gigantic and lucrative US capital market, deprived of using the dollar as a means of payment, and condemned to closing down its branches in the US. Its executives, even those living outside the US, would no longer be able to send their children to US universities, or even get care in American hospitals if they wanted to, and would be refused entry to the US for a simple leisurely holiday.
This arsenal of dissuasion therefore grants this almighty power to the US that certainly wouldn’t show any mercy to a foreign country hoping to avoid these penalties by doing business in euros (for example) with an Iranian company.Any European company naively hoping to avoid or circumvent US sanctions would be immediately blacklisted by the US Department of Justice that will find out one day or another (because nothing gets past them) and that will reserve some “special” treatment for them. It is therefore not so much the weapon of the dollar that grants them their formidable effectiveness through sanctions. It is this prohibition, for anyone, forcing them to forego the undeniable quality of the technology, services, goods and experience that the companies and individuals of the United States of America enjoy.
Any company and country, whatever their size and stature, will not hesitate to make any sacrifice if it means having continued access to the US.