Sanctions and Economic Warfare in the US–China Contest: The "Renmin School" Playbook
Deep Dives
Explore related topics with these Wikipedia articles, rewritten for enjoyable reading:
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Guanzi (text)
11 min read
The article directly references a parable from this ancient Chinese legalist text about economic warfare ('Wearing fine silk to subdue Lu'). Understanding this classical source illuminates how Chinese strategic thinking on economic coercion draws on millennia-old traditions.
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Rare-earth element
14 min read
The article discusses China's October 2025 rare earth export controls as a key example of economic warfare. Understanding the geology, processing challenges, and strategic importance of these elements provides essential context for why they're such a potent tool of economic statecraft.
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Coordinating Committee for Multilateral Export Controls
13 min read
The article references Reagan-era economic pressure against the Soviet Union. The Coordinating Committee for Multilateral Export Controls was the primary Western mechanism for this economic warfare during the Cold War, providing historical precedent for modern US-China export control regimes.
“Once sanctions end, the initiating country should proactively rebuild economic relations with the targeted state to mitigate any chilling effect. Such compensation and assistance not only help realise the aims of the sanctions, but also prevent the targeted country from developing sanctions immunity. This lays the groundwork for maintaining the credibility of future economic-coercion threats, sending a clear message: resistance incurs heavy costs, whereas compliance brings tangible benefits.” — “Sanctions and Economic Warfare”, by Di Dongsheng, Ji Xianbai and Wei Zilong
Recent exchanges of blows over Sino–US export controls have underscored that dominance in global trade is likely to remain the central battleground among the world’s leading powers. Against this backdrop, we review Sanctions and Economic Warfare (July 2025), a book by a group of scholars at Renmin University of China. Treating trade and economic instruments as the primary tools of statecraft in the current geopolitical moment, the authors draw on a wide range of historical cases to develop a realpolitik-inflected sanctions playbook for China’s strategic direction.
It is a bleak conception of trade, in which economic exchange is subordinated to power and geopolitics, illustrated through cases ranging from the use of border markets (互市) in imperial China’s management of Inner Asia to the Reagan administration’s deployment of economic pressure against the Soviet Union. Yet it is also a compelling account of economic statecraft, advanced by scholars who would endorse the recent US National Security Strategy’s assessment that economics constitutes the “ultimate stakes”.
— James Farquharson
Key Points
Effective sanctions use strengthens asymmetric economic interdependence rather than erodes it, deepening a rival’s reliance on the sanctions initiator over time.
The success of sanctions depends on whether short-term economic shock exceeds the adjustment capacity of the target, with shock-and-awe tactics more effective than gradual escalation.
Post-sanctions reassurance and trade normalisation reduce incentives for the sanctions target to diversify its trade links, preventing it from developing long-term “immunity” to future economic coercion.
Dynastic China’s management of steppe empires shows that exercising differential treatment towards rival economic blocs—penalising the strongest while rewarding the second-strongest—can fracture their internal cohesion.
Cognitive warfare can be employed to shape reactions to economic pressure, as the Reagan administration did during the Cold War by pairing economic pressure and encirclement with radio broadcasts in Eastern Europe.
Insights and analysis on China’s global ascension: China’s reach extends from boardrooms to trade blocs, steering investment, innovation, and strategic alliances across the
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