Collective Resilience: Deterring China's Weaponization of Economic Interdependence

Abstract

Abstract Since the 2010s, China has used economic coercion against Western and Asian states to achieve territorial and political goals. China's leveraging of its market is a form of “predatory liberalism” that weaponizes the networks of interdependence created by globalization. The United States and other like-minded partners have mostly used piecemeal “de-risking” measures such as decoupling, supply chain resilience, reshoring, and trade diversion to reduce dependence on China and thereby minimize vulnerability to its economic coercion. But these practices do not stop the Chinese government's economic bullying. “Collective resilience” is a peer competition strategy designed to deter the Xi Jinping regime's economic predation. What informs this strategy is the understanding that interdependence, even asymmetric interdependence, is a two-way street. Original trade data show that the previous and current targets of economic coercion by the Xi Jinping regime export over $46.6 billion worth of goods to China on which it is more than 70 percent dependent as a proportion of its total imports of those goods. These target states could band together in a collective resilience alliance and practice economic deterrence by promising to retaliate against China's high-dependence trade should Beijing act against any one of the alliance members.