The toll from the war between Israel and Hamas continues to grow. One important consideration from the ongoing conflict is the potential sanctions that would be imposed on countries involved. Abishur Prakash, The Geopolitical Business Founder, joins Yahoo Finance to discuss what impact potential sanctions would have on businesses.
Prakash brings up important considerations with sanctions: "Equally important is what I call 'reverse sanctions'. Iran just came out and called on Arab nations to sanction Israel." He continues, saying "more geopolitical red tape essentially cuts access to markets and makes trade more difficult and makes the movement of goods more difficult and it's also not just a question of the U.S imposing sanctions, look at the trade war between the U.S and China, there's also the retaliatory part too. That retaliatory part might just not be on putting a 10% tariff on imports or exports, it could be even restricting visas to talented professionals."
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SEANA SMITH: Like we've seen as a result of Russia's war with Ukraine, we saw a number of sanctions put in place by the US. When you take a look at what's happening right now in the Middle East, do you see the potential here for sanctions against some of these countries? And I guess, how do you see that playing out, or what does that mean here for the business community?
ABISHUR PRAKASH: Well, right now the most direct way the US is assisting Israel is through military, but this is not likely to be the end of the road. American assistance is most likely going to expand into other areas. And this creates the potential for more geopolitical red tape, i.e. sanctions. You look at that came out that said Hamas soldiers were trained in Malaysia. So now this opens a new front where could the US or the west begin to sanction countries that either have supported Hamas in the past or have supplied some kind of incentive to them for this attack.
Equally important is what I call reverse sanctions. Iran just came out and called on Arab nations to sanction Israel. And already you look at US relations with countries like Saudi Arabia, it's rocky territory. So could we now see-- just as the Ukraine war was transformative for geopolitics, could we now see the beginning of reverse sanctions where countries try to sanction America or try to sanction American allies?
BRAD SMITH: What type of economic impact do you believe that further sanctions would then have long-term?
ABISHUR PRAKASH: Well, it depends on the business, it depends on the industry. But more geopolitical red tape essentially cuts access to markets, and makes trade more difficult, and makes the movement of goods more difficult. And it's also not just a question of the US imposing sanctions, it's-- look at the trade war between the US and China. There's also the retaliatory part too. And that retaliatory part might not just be on putting a 10% tariff on imports or exports. It could be even restricting visas to talented professionals. It could affect business in all kinds of complex ways.
So again, businesses need to look at this conflict, not through the traditional lens that this is another war, but through the transformative lens that this could begin to affect areas that were once considered untouchable by geopolitics.
BRAD SMITH: Abishur Prakash, who was the Geopolitical Business Founder. Thanks so much for taking the time here today and breaking some of this down for us. Appreciate it.
ABISHUR PRAKASH: Thanks for having me.