China’s retaliatory export controls on critical minerals and the United States’ aggressive tariff policies have fundamentally transformed global economic competition into a struggle of weaponized interdependence. During his second term, President Donald Trump weaponized access to the U.S. consumer market, forcing international partners to accept unequal trade terms while Beijing pushed back forcefully.
This shift marks the decline of the post-Cold War economic model, where Washington leveraged its 20 percent share of the world economy to dictate international trade rules. Instead, it bypassed these frameworks to build a world-leading electric vehicle industry using state subsidies. By weaponizing dominance over rare earth supply chains, the nation successfully countered American tariff threats, demonstrating that supply-chain control outweighs financial leverage. Furthermore, the limited impact of G7 financial sanctions on Russia after its 2022 invasion of Ukraine underscores the weakness of finance as a strategic weapon. Consequently, a fragmented global order is emerging where the two leading powers weaponize supply and demand.
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