Former Communist state embargo, inter alia (7)
I believe the answer is:
albania
'former communist state' is the definition.
'Albania' can be an answer for 'state' (Albania is an example). I am not sure about the 'former communist' bit.
'embargo inter alia' is the wordplay.
'embargo' becomes 'ban' (a ban on trade).
'inter' means one lot of letters goes inside another ('inter' means between or among in Latin).
'ban' placed into 'alia' is 'ALBANIA'.
Can you help me to learn more?
(Other definitions for albania that I've seen before include "Country in the Balkans" , "Southeast European republic" , "Balkan country" , "Country W of Macedonia" , "Eastern European country" .)