The introduction of sanctions in international trade has become a serious challenge for many companies. Restrictions make it difficult to do business, destroy traditional logistics chains, and create problems with suppliers and financial settlements.
Nevertheless, businesses are actively adapting, using legal strategies to circumvent sanctions.
These strategies help companies minimize risks, maintain access to markets, and ensure business sustainability in the new environment.
Why is it necessary to circumvent sanctions
Sanction restrictions create many problems for businesses. The breakdown of business ties, rising transportation costs, and payment difficulties are forcing companies to seek alternative ways of working.
- The impact of sanctions on business and logistics:
They have a significant impact on logistics processes and trade, requiring rapid adaptation. Companies are faced with the destruction of traditional supply chains, which leads to additional costs.
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Loss of suppliers, partners and sales markets:
Often leads to the loss of key suppliers, partners, which forces businesses to reorient themselves to new markets, look for alternative suppliers.
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Increasing cost and delivery times:
Changing routes and using more complex logistics schemes increases costs and delivery times. In some cases, the cost of logistics increases several times, which reduces the marginality of the business.
Key strategies for bypassing sanctions
Companies are developing various strategies to bypass sanctions restrictions in order to continue international trade, logistics. Let's consider the most popular of them.
Re-export through third countries
One of the most common strategies is the use of re-export through countries that have not supported the sanctions.
Popular intermediary countries are Kazakhstan, Turkey, UAE, and the countries of Southeast Asia. New logistics hubs are being created here, through which commodity flows pass. Although this increases delivery times and costs, companies retain access to the necessary goods.
Changing supply chains
Restructuring logistics chains is an important adaptation strategy:
- Finding new suppliers in Asia and the Middle East.
- Creating land routes, bypassing sanction restrictions.
- Developing distribution centers in countries with favorable legislation.
- Optimizing document flow to simplify customs procedures.
Using friendly jurisdictions
Companies actively cooperate with countries that maintain a neutral position. This allows for international settlements and access to markets without the risk of secondary sanctions.
The BRICS and SCO countries are of particular importance, creating platforms for financial transactions and trade.
Development of alternative payment mechanisms
Restrictions on international settlements force businesses to look for new ways to make payments:
- Transition to settlements in national currencies (ruble, yuan).
- Using cryptocurrencies for fast, secure transactions.
- Barter schemes, when goods are exchanged directly, without the participation of financial institutions.
- Direct interbank transfer systems to bypass blocked settlements via SWIFT.
Creating new logistics schemes
Integrated logistics solutions help minimize the impact of sanctions:
- Multimodal transportation using automobile, railway and sea transport.
- Developing new delivery routes through safe corridors.
- Optimization of customs clearance to speed up the procedure for releasing goods.
- Digital cargo tracking systems that increase the transparency and efficiency of transportation.
Risks and consequences of circumventing restrictions
Circumvention strategies are associated with a number of risks that must be taken into account in order to minimize possible consequences.
Legal consequences
Violation of legal norms can lead to serious legal consequences, including fines, seizure of cargo, secondary sanctions. Organizations must carefully monitor compliance with the requirements of the legislation of the countries involved in the transactions.
Financial risks
Key financial risks:
- Volatility of exchange rates, especially when settling in national currencies.
- Increased cost of financial transactions due to limited access to international settlements.
- Freezing of accounts in unfriendly countries.
Logistical difficulties
New delivery routes are often more complex, costly:
- Increased delivery times due to crossing multiple borders.
- Increased transportation costs, the need for coordination between different participants in the supply chain.
- Difficulties with customs clearance in regions that use double standards.
Reputational risks
Circumventing sanctions can negatively affect reputation:
- Loss of trust from international partners.
- Blocking cooperation with major market players.
- Negative brand perception from customers and investors.
Sanction restrictions seriously change the rules of the game in international trade and logistics. However, businesses are showing great flexibility in developing strategies to successfully circumvent sanctions. A comprehensive approach to adaptation allows not only to minimize risks, but also to create more sustainable, diversified business models.
In the long term, companies that have managed to adapt to new conditions will have a competitive advantage in the global market.
