If applied, sanctions restrict trade and investment activities, resulting in fewer joint ventures, fewer US jobs, severed supply relationships, and in severe cases, shut-down operations. The negative effects can have significant long-term consequences. Sanctions make US-based companies less competitive, causing firms to lose market share that is only slowly, and sometimes never, recovered after the sanctions are lifted. Access to fewer markets can undermine competitiveness in many ways, including price competitiveness and technological competitiveness. Price competitiveness can suffer due to smaller economies of scale or reduced access to key resources.
Technological competitiveness can suffer due to fewer strategic partnerships.
The harm done to US competitiveness includes the harm done to the US subsidiaries of European-owned companies. A sanction that restricts the exports of a US-based company, regardless of ownership, means less work is available for US citizens. Furthermore, the harm done by sanctions often does not end with the loss of the initial export or investment. Depending on the product or service, the damage also can include lost contracts for long-term maintenance, repair, and upgrades. Another problem created by sanctions is that some non-US companies have sought to minimize the US content of their products to reduce the risk of disruptions to their operations.