Coined by political scientists Henry Farrell and Abraham L. Newman, the term refers to the strategic leveraging of global economic networks—like finance, supply chains, and communication systems—to exert coercive pressure on other states. This isn’t traditional military force, but control via chokepoints or surveillance-like power in the global economic architecture .
Chokepoint effect — Dominant players can restrict or penalize access to critical network hubs.
Panopticon effect — They can monitor and observe others’ activities through embedded informational structures .
U.S. Economic Power as a Weapon
Financial Coercion
The United States has weaponized its dominance in global finance—primarily through:
The U.S. dollar’s centrality in foreign exchange and global reserves.
Influence over SWIFT and financial messaging systems.
Its role in global debt issuance .
These tools enable economically punitive measures—like sanctions—without firing a weapon .
Trade and Manufacturing Limitations
However, the U.S.’s coercive capacity in trade is more limited:
China dominates manufacturing and critical materials, granting it leverage in areas like rare earths, lithium, cobalt, and semiconductors .
U.S. export restrictions—e.g., on chipmaking technologies—have prompted retaliatory supply controls from China, highlighting mutual vulnerabilities .
China’s Strategic Countermeasures
Unlike the U.S., whose sanctions tend to have legal justification, China employs more opaque, politically motivated coercion. This includes:
Trade restrictions or boycotts following political slights—e.g., countries meeting with the Dalai Lama.
Private sector compliance or self-censorship (companies removing content or apologizing to avoid Chinese backlash).
Tourism bans, restrictive trade practices, and market access limits .
This strategy shapes behavior by creating a mental environment of deference—discouraging criticism of China due to fear of economic repercussions .
Global Impacts and Responses
Risk of Fragmentation
Continuous economic coercion risks destabilizing the global economic order.
Sanctions can backfire: countries may seek alternatives, fragmenting global systems.
Scholars note resemblances to the interwar era—sanctions undermining cooperation and security .
Regulatory vs. Abolitionist Approaches
Regulatory Mode: Proposes legal/ethical frameworks to minimize humanitarian harm from economic coercion (akin to laws of armed conflict).
Abolitionist Mode: Rejects economic coercion outright, especially unilateral measures that undermine sovereignty .
Multilateral and Collective Resilience
Solid strategies to resist coercion include:
Diversifying trade partners and supply chains.
Strengthening legal/regulatory frameworks (e.g., the EU’s ACI).
Coordinated responses through institutions like the G7, WTO, OECD, or ad-hoc coalitions .
Key Takeaways
1. Global economic networks now serve as instruments of power, beyond just trade and finance—encompassing communication technology, supply chains, and messaging systems.
2. Both the U.S. and China weaponize interdependence—but in different ways:
The U.S. uses transparent, legally justified leverage via finance and sanctions.
China uses less transparent coercion tied to political objectives and market control.
3. Overusing coercive economic tools risks fragmenting globalization, reducing system resilience and multiplied vulnerability.
4. The path forward should blend regulation and cooperation, leveraging alliances, legal safeguards, trade diversification, and institutional reform to restore stability and limit coercion’s destructive capacity.
Warsame Policy & Media Network (WAPMEN) 