The Future of Economic Statecraft
How sanctions, export controls, and financial warfare are evolving as the global economy fragments and new technologies emerge.
A New Era of Economic Warfare
The post-2022 period has seen an explosion in the use of economic tools for strategic purposes. The US, EU, and allies have deployed an unprecedented combination of sanctions, export controls, investment screening, and asset seizures against Russia. The US has imposed technology export controls on China that aim to maintain permanent advantage in foundational technologies. China has retaliated with export restrictions on critical minerals. The era of economic interdependence as a force for peace has given way to an era of 'weaponized interdependence.'
This transformation raises fundamental questions. If every economic relationship is a potential weapon, then every country has an incentive to reduce its vulnerabilities by diversifying supply chains, building domestic capacity, and reducing dependence on potential adversaries. The result could be a less efficient but more resilient global economy -- or a fragmented one where the efficiency gains of globalization are lost.