The dynamics of sanctions’ impact on the foreign trade of the Russian Far East

This study aims to assess the dynamic impact of "local" sanctions on the trade of the Russian Far East. It shows that the "local" sanctions (2014–2021) were comprehensive and open-ended, heightening the risks of bilateral interactions between Russia and both the sanctioning and the sanctioned countries – a pattern that became evident in the Russian Far East. A delayed, increasingly negative impact of sanctions on the region's trade was identified. The direct restraining effect of foreign sanctions was found to have grown from 38.6% in 2017 to 64.3% in 2021, while the effect of Russian sanctions against foreign countries rose from 50.0% in 2018 to 58.5% in 2021. The globalization effect was found to have mitigated the negative influence of the sanctions on the trade of the macro-region under study. In terms of the tariff equivalent, the stimulating effect of globalization on the Far East's trade in 2021 proved to be nearly half as strong in the case of the negative impact of Russian sanctions against foreign countries as it was in the opposite case. The globalization effect, however, was unable to reverse the mounting trend of the restraining influence of the sanctions on the macro-region's trade with the sanctioning and the sanctioned countries. As a result, the overall effect of foreign sanctions against Russia contributed to a 27.4% reduction in the Far East's trade volume with those economies in 2017 and a 54.0% reduction in 2021, whereas the effect of Russian sanctions against foreign countries produced a reduction of 42.4% in 2018 and 52.1% in 2021. It is suggested that the rise in the positive globalization effect may be accounted for by the specific nature of the Far East's trade with Japan, which, despite the sanctions, remained a close and one of the largest markets for the macro-region, owing to its investment participation in regional projects. The study points to a delayed, disproportionate increase in the risks of trade and economic interactions under the conditions of comprehensive sanctions confrontation between countries, including at the regional level.