12/07/2021 | Press release | Distributed by Public on 12/07/2021 15:20
Washington, December 7, 2021-The United States and its allies are increasingly forced to respond to coercive economic statecraft-i.e., restrictions on trade, investment, and financial transactions intended to impose economic costs on a target in pursuit of strategic objectives-employed by China. At the same time, the United States lacks a broader strategy for the effective use of economic tools to manage and respond to scenarios of geopolitical tension. A new CNAS report sets a new strategic framework for U.S. coercive economic statecraft toward Beijing.
To gain new insights into U.S.-China economic escalation dynamics, CNAS conducted two unique tabletop exercises. The first scenario presented a crisis involving significant aggression from China against Taiwan, while the second presented a crisis surrounding a potential Chinese acquisition of dual-use technology from a fictitious European company.
Insights from the scenario exercises include:
Based on these insights, report authors Emily Kilcrease, Director of CNAS' Energy, Economics, and Security Program, Rachel Ziemba, Adjunct Senior Fellow, and Emily Jin, Research Assistant, propose a new framework of using coercive economic measures based on the strategies of joint pressure and bound engagement.
United States use the strategy of joint pressure -- coordinating its responses with partner countries -- to maximize pressure on China, strengthen the ability of the United States to impose costs, and minimize China's ability to retaliate. The authors also recommend a strategy of bound engagement, by which it engages in economic escalation in a manner bound by constraints embodied in domestic and international rules and norms.
For more information or to schedule an interview with the authors, please contact Sydney Simon at [email protected].