China’s growing global power presents significant challenges for US national and economic security. The use of economic coercion to influence smaller countries is of particular concern as China leverages trade dependencies, investments, and access to its vast market to extract political concessions from other nations. This strategy’s success has been evident in cases such as Australia, which faced trade restrictions after calling for an independent investigation into COVID-19’s origins, and Lithuania, which suffered economic retaliation from China after Lithuania strengthened ties with Taiwan.
China’s economic pressure undermines global norms of free trade and sovereignty, creating a system where smaller nations feel compelled to align themselves with Beijing’s interests. This dynamic weakens US alliances and influence, particularly in the Indo-Pacific, Africa, and Latin America, where Chinese investments in infrastructure and technology have expanded its geopolitical reach. For example, the Chinese Belt and Road Initiative (BRI) has also led to substantial debt dependency among participating nations.
For American consumers, allowing coercive Chinese tactics to go unchecked can mean higher prices on key goods and disruptions to critical supply chains. Americans suffer when China punishes the US or other nations by restricting exports of essential goods and imposing tariffs or trade embargoes that affect the prices of electronics, machinery, food, and other household necessities. Additionally, China’s state-backed industries and subsidies distort global markets, which can put American businesses at a disadvantage.
Policymakers on both the left and right share concerns about China’s use of economic coercion as a tactic for geopolitical gain.
Proposals include:
