USG Impediments to Aid
Sanctions have become the first line of attack when U.S. security interests are threatened. The scale and scope of these restrictions have expanded in recent years, and entities/individuals subject to sanctions are often present in contexts where NGOs are responding to the greatest needs.
Sanctions reforms are necessary to avoid unintended consequences on humanitarian aid and development. Sanctions are a primary impediment to the timely and effective delivery of humanitarian aid in crisis settings, as they do not adequately protect legitimate humanitarian action. Consequently, NGOs must invest significant resources in navigating complex legal and security environments, beyond what they already do to comply with humanitarian principles and to protect their work, donors, and beneficiaries. Coupled with the U.S. prohibition on material support to designated terrorist entities, these impediments often result in avoidable suffering as the needs of the most vulnerable people are not met.
Confusing and changing sanctions programs also result in what is commonly called “bank derisking,” where financial institutions are reluctant to process funds transfers for programming in sanctioned countries and regions or where designated entities and individuals are present. When NGOs lose access to formal banking channels, they often must use alternative means of moving money overseas, such as carrying cash, which poses its own risks and can undermine the goals of counter-terror financing.
As stated in the Anti-Money Laundering Act of 2020, “providing vital humanitarian and development assistance and protecting the integrity of the international financial system are complementary goals.” Solutions must strike a balance between two equally important objectives: stopping financing of malign actors and promptly facilitating vital, life-saving humanitarian aid to crisis-affected people.
InterAction’s Together Project confronts obstacles facing principled humanitarian action to help shape systemic solutions.