The first months of 2025 are likely to mark a turning point in the history of sanctions against Russia: after three years of ”escalating” but steadily reducing the tempo of sanctions policy, the West seems to have realized that sanctions are less likely to force the Kremlin to stop the war than to be used as leverage to secure the desired outcome of peace negotiations.

This is also confirmed by the US policy: on the one hand, in January, former President Joe Biden announced a series of new sanctions, and on the other, President Donald Trump has indicated that he is open to both lifting some sanctions and tightening them, depending on Putin’s “bargaining power”. Let us focus on one much-discussed aspect of sanctions policy that has not yielded much in the past three years.

Already in the first year of the full-scale invasion, Russia initiated a policy of circumventing trade sanctions through intermediary countries, mainly its partners in the Eurasian Economic Union. While its closest ally, Belarus, could not help the Kremlin much, having faced similar restrictions earlier and for other reasons, Armenia and, to a lesser extent, Georgia in the Caucasus and Kazakhstan and Kyrgyzstan in Central Asia showed their “true colours”.

Kazakhstan increased its exports of smartphones to Russia by 2,000 times in 2022, while Armenia exported 225 times more cars to Russia (which it does not produce) and 11 times more gold (precisely after transactions with Russian metal were banned by EU sanctions). While the volume of Russia’s foreign trade transactions fell by 10.2% between 2021 and 2023, Russia’s mutual trade turnover with Kazakhstan increased by 48%, with Kyrgyzstan by 75% and with Armenia by more than 4.2 times.

The extent of sanctions evasion was noted by independent researchers, who pointed out that Russia quickly resumed imports of even dual-use goods that had been sanctioned in the first weeks of the war (Western chips and semiconductors were found almost constantly in the wreckage of Russian missiles in Ukraine). Moreover, factory and plant equipment also began to flow into Russia — if not in the form of ”disappearing” transit cargo from the EU to Kazakhstan, then as a result of post-Soviet countries buying equipment “as part of the modernization” of their industrial potential and sending dismantled equipment to Russia (which was not subject to any restrictions). European and American regulators tried to influence Moscow’s partners, either by persuading them to join the sanctions “in good faith” or by threatening serious action against local companies. Summing up the results of this policy, it can be said that it was relatively successful only in relation to banks and financial organizations, which eventually stopped servicing cards of Russian payment systems and made it more difficult for Russians to open accounts. At the same time, it should be noted that the overall result of the sanctions policy was close to zero: restrictive measures were introduced at various times only against individual companies — ten companies were affected in Kyrgyzstan, four in Kazakhstan and three in Armenia.

The question is: was it possible to stop the circumvention of Western sanctions by the countries of the Eurasian Economic Union? Yes, it was — and the same tool could have been used to achieve much more ambitious geopolitical goals.

The mistake of the sanctions policy initiated by the West against Russia since 2014 was that it was seen as a tool for solving individual problems (the de-occupation of Crimea or the end of the war in Ukraine), rather than as an important factor of strategic deterrence for the Kremlin, as the Western economic measures against the USSR were throughout the Cold War. For various reasons (that in no way excuse western governments) Russia is not perceived as the existential threat to the world order that it has been since at least Putin’s return to the Kremlin in 2012, when Russian ideologues began to praise the “world without rules”. This misguided perception has prevented Western policymakers from seeing Russia not only as a revisionist power in its own right, but also as the leader of various alliances and integration structures that, because of their concentration around Moscow, also pose a significant threat to peace and security.

Let us not forget that immediately after the beginning of the Cold War, Nato countries and a number of their allies formed an organization called CoCom (Coordinating Committee for Multilateral Export Controls), which played an extraordinary role in undermining the economic power of the USSR. The two main principles of this organization are completely excluded from the current version of sanctions policy. On the one hand, the participating countries were obliged to refuse to supply a wide range of specified goods not only to the USSR but also to all Warsaw Pact and CMEA (The Council for Mutual Economic Assistance) countries (the first relaxations for Czechoslovakia, Poland and Hungary were introduced in 1989, when the Cold War was lost by the “Eastern bloc”, while serious changes in the goods nomenclature with regard to all countries date back only to June 1990). On the other hand, companies found to have violated the terms of trade were subject to sanctions by other parties to the agreement and could lose access to their markets, while sales to any country outside the organization could be traced if a product or group of products fell within the controlled nomenclature. The result was a calibrated export control system that categorically ruled out the supply of French, German or American telecommunications equipment to the Soviet Union, even from Yugoslavia. It is clear that the USSR’s system of foreign trade relations at that time was not even remotely similar in flexibility to the current Russian system, but in general the approaches to the problem were extremely consistent.

Another important mistake made by Western policymakers in the early 21st century regarding Russia has been to underestimate the nature of the ties between Moscow and its current partners in the Eurasian Economic Union and/or the Collective Security Treaty Organization (CSTO). Unlike the Warsaw Pact, which in the Soviet times was comprised of the countries de facto occupied by the USSR after World War II whose sovereign rights were limited by the Brezhnev Doctrine, the current members of the pro-Russian integration associations are united primarily on the basis of economic benefits. Armenia, for instance, has already come to experience the extent to which the other allies in the military bloc are (un)willing to come to its defence, and seems to have drawn some conclusions from this experience. Therefore, if the introduction of trade restrictions with Western countries could in no way affect the participation of certain “people’s democracies” in the Warsaw Pact and the CMEA (Council for Mutual Economic Assistance), the same cannot be said for the post-Soviet states. Even if one assumes that economic issues played a comparable role, it is worth noting that by 1983 the share of the USSR and other CMEA member states in the foreign trade turnover of the GDR, Poland and Czechoslovakia had reached 62.5%, 68.4% and 71.9% respectively, whereas today (calculations for 9−10 months of 2024) for Kazakhstan, Kyrgyzstan or Armenia, the share of Russia and other Eurasian Union countries is 23.4%, 30.8% and 42% respectively, which clearly indicates the importance for these countries of maintaining strong ties with various actors outside the post-Soviet space. It follows that the Eurasian Economic Union would probably cease to exist if the regime of sanctions against Russia (even if only trade and technology sanctions) were extended to the countries that share a common customs space with Russia. One of Putin’s key myths about Russia’s ability to ”gather” the post-Soviet countries around it would be completely shattered.

The involvement of Russia’s neighbours in various schemes to circumvent the sanctions imposed on Moscow is also due to the fact that, unlike the Cold War era, Western governments are now categorically unwilling to put pressure on their own companies. This allows these said companies to increase their profits by supplying products to third countries, which then enter the Russian market. Given that virtually all high-tech products today have unique serial numbers, and a significant proportion of them can be traced and located at any time, it is not difficult not only to find out whether sanctioned goods have ended up in Russia, but also to trace the route of their delivery (all that is needed is the will, which Western countries lack). The example of not even sanctions, but the mere threat of their application against Chinese banks, which the US made in December 2023, shows how big business (even if only temporarily) becomes an important executor of the sanctions regime control. If the same measure were applied to Western exporters, no shrewd businessman from the post-Soviet states would be able to send sub-sanctioned goods to Russia, because in case of a breach of the ban, suppliers would simply limit their contacts with the respective countries.

In other words, if we frankly assess the policy of the Western powers towards the countries of the Eurasian Union regarding the sanctions regime, we will need to admit that it is characterized by incredible duplicity. On the one hand, the US and EU countries seem to curtsy and show that they consider these states sovereign and independent from Moscow: they seem to include them in their global alliance of fighters against Russian aggression, but at the same time they shift all responsibility for compliance with the sanctions onto them. On the other hand, the West is clearly aware that the status of these countries as members of the Eurasian Economic Union allows their companies to freely supply sanctioned goods to Russia. What is more, any attempt to create obstacles to their movement would be seen in Moscow as a violation of the terms of the integration agreements. In other words, it would not be a big mistake to think that Western policymakers agree — albeit tacitly — that the anti-Russian sanctions regime is being and will continue to be violated, but that only Russian organizations or individuals (against whom almost 24,400 sanctions measures have been imposed to date) will be punished, but never these intermediary countries and even less likely, manufacturing companies.

This policy is conditioned only by the obvious fact that the West does not intend to restore the Cold War order and is not fighting against Russian aggression against Ukraine, but against the regime that carried out this aggression (but if we draw historical analogies, we can see, for example, that the Soviet invasion of Afghanistan did not significantly alter the regime of trade restrictions: the US refused to deliver some of the promised grain and boycotted the Moscow Olympics with its allies, but for most technological goods the previous order remained in place, as the West fought the communist threat, not just some of its individual manifestations). Today, Russia is still very much treated as a ”normal country” that has temporarily deviated from its trajectory, while its satellites are expected to adhere to basic Western standards of behavior. Therefore, the sanctions will continue to be implemented as a game of cat and mouse, while Russia’s neighbors continue to do business, talking about greater integration when at official meetings in Moscow and about effectively confronting the former hegemon, Russia, when outside the former empire.

Vladislav Inozemtsev is the Co-founder and Advisory Council Member, Center for Analysis and Strategies in Europe.

This article first appeared in Riddle here. Riddle is an independent media outlet focusing on independent analysis of Russia and a bne IntelliNews media partner. Follow on X @RiddleRussia