For decades, the conventional wisdom held that economic interdependence promotes peace. Countries that trade together have too much to lose from conflict; global supply chains create shared interests; integration binds nations into a community of mutual benefit. The logic seemed irrefutable: why would states risk war when commerce makes them rich?
But interdependence has a shadow side. The same networks that enable trade and communication also create vulnerabilities. States that occupy central positions in these networks—controlling financial chokepoints, dominating technological standards, or hosting critical infrastructure—can weaponize these positions against rivals. This is weaponized interdependence: the strategic exploitation of global networks for coercive purposes.
The Structure of Network Power¶
Global systems are not flat; they have architecture. Some nodes matter more than others:
Hub-and-spoke structures concentrate flows through central points. The international payments system routes through a handful of institutions; internet traffic passes through specific exchange points; semiconductor supply chains depend on a few critical manufacturers. These hubs enable efficiency—but also create chokepoints.
Asymmetric access means some states and firms occupy more central positions than others. The United States dominates dollar-based finance; American technology platforms intermediate global communications; a small number of companies produce advanced semiconductors. This centrality confers power that dispersed participation does not.
Lock-in effects make switching costly. Once institutions, firms, and individuals depend on particular networks, abandoning them imposes significant transition costs. SWIFT for international payments, the GPS constellation for navigation, English for scientific publication—alternatives exist but adoption requires sustained effort.
Mechanisms of Weaponization¶
States exploit network centrality through two primary mechanisms:
Panopticon effects enable surveillance. Central positions provide visibility into flows passing through network hubs. The United States can monitor dollar-denominated transactions; a state controlling internet exchange points can observe communications; platforms collecting data know what users search, buy, and say. This visibility provides intelligence advantages and enables targeted action.
Chokepoint effects enable coercion. Central positions allow blocking or degrading flows. Exclusion from SWIFT prevents international payments; denial of semiconductor manufacturing cuts off chip supplies; removal from app stores limits software distribution. Threatening or executing such exclusion becomes a tool of statecraft.
The scholars Henry Farrell and Abraham Newman, who developed the concept, describe it as “the ability of some states to leverage their privileged positions in networks of interdependence to extract compliance or punish noncompliance from other actors.”
Weaponization in Practice¶
Multiple domains demonstrate weaponized interdependence:
Financial networks present the most developed case. Dollar dominance means most international trade settles in dollars, flowing through American-regulated correspondent banks. The SWIFT messaging system, though headquartered in Belgium, operates under effective American influence. When the United States imposes sanctions, it can exclude targets from the global financial system with devastating effect.
Iran’s experience illustrates the power. Following nuclear-related sanctions, Iranian banks lost SWIFT access; the country could not receive payments for oil exports or pay for imports through normal channels. The economic damage helped bring Tehran to the negotiating table for the JCPOA nuclear deal.
Technology platforms intermediate information flows globally. American firms—Google, Apple, Meta, Amazon, Microsoft—dominate cloud computing, mobile operating systems, search, and social media. European dependence on these platforms prompted digital-sovereignty initiatives; Chinese exclusion (both self-imposed and externally applied) created a separate digital ecosystem.
Semiconductor supply chains concentrate critical production in a few locations. Taiwan Semiconductor Manufacturing Company (TSMC) fabricates most advanced chips; ASML in the Netherlands produces the lithography equipment essential for cutting-edge manufacturing; American firms design key chips and develop crucial software tools. Export controls can deny adversaries access to essential technology—as American restrictions on China demonstrate.
Cloud infrastructure hosts critical data and computing services. When data resides on foreign servers subject to foreign law, sovereignty questions arise. The American CLOUD Act enables U.S. authorities to compel data disclosure from American firms regardless of where data is stored—creating conflicts with European privacy law and prompting data localization debates.
Strategic Responses¶
States facing weaponized interdependence pursue several strategies:
Diversification reduces dependence on any single network or provider. Europe’s efforts to develop alternative financial messaging (INSTEX for Iran trade), China’s creation of CIPS for yuan-denominated payments, and various states’ pursuit of domestic cloud infrastructure all reflect this logic.
Duplication builds parallel systems that can substitute for networks subject to weaponization. Russia’s SPFS payment system, China’s BeiDou navigation constellation (alternative to GPS), and Huawei’s HarmonyOS (alternative to Android) all create options outside Western-controlled infrastructure.
Obstruction resists compliance with weaponization demands. The EU’s blocking statute forbids European firms from complying with certain extraterritorial sanctions; data localization laws prevent information from reaching foreign jurisdictions; encryption and anonymization technologies reduce surveillance vulnerability.
Resilience building accepts continued network participation while reducing vulnerability to disruption. Stockpiling critical components, developing domestic production capacity for essential goods, and maintaining alternative communication channels all enhance resilience.
Retaliation threats may deter weaponization by promising reciprocal costs. A state with its own network centrality can threaten counter-exploitation; even states without such centrality may possess other leverage that deters action.
Consequences and Risks¶
Weaponized interdependence carries significant implications:
Network fragmentation may result as states seek to reduce vulnerability. The multipolar digital and financial order that emerges could be less efficient than integrated systems but may be more resilient to coercion—and may better reflect diverse values and interests.
Erosion of trust undermines the benefits interdependence provides. If economic relationships are potential weapons, states will invest less in them. The efficiency gains from globalization depend on confidence that connections will not become constraints.
Escalation dynamics may emerge when states respond to weaponization with counter-measures. Sanctions invite retaliation; technology denial prompts indigenous development; financial exclusion accelerates de-dollarization. Spirals of mutual exclusion could fragment the global economy.
Normative ambiguity surrounds the legitimacy of weaponized interdependence. When the United States uses financial power to punish nuclear proliferation, many see legitimate enforcement of international norms. When China uses economic pressure against Australia for demanding a COVID inquiry, many see illegitimate bullying. The line between justified use of leverage and improper coercion remains contested.
Institutional strain affects the organizations managing global networks. SWIFT, once a purely technical utility, has become a geopolitical instrument. Internet governance bodies face pressure from competing sovereignties. The WTO struggles to address “national security” exemptions that justify weaponized measures.
The Future of Interdependence¶
Several trends will shape how weaponized interdependence evolves:
Great power competition between the United States and China ensures continued attempts to leverage network positions and continued efforts to reduce vulnerability. Geoeconomic competition through networks has become a permanent feature of their rivalry.
Middle power maneuvering will intensify as states seek to avoid becoming collateral damage in great power contests. India, Indonesia, Brazil, and others will pursue diversification while maintaining access to all major networks.
Technology evolution may create new chokepoints (quantum computing, advanced AI) or reduce existing ones (decentralized finance, mesh networks). The structure of future networks remains contested terrain.
Normative development could establish limits on weaponization, distinguishing acceptable uses from illegitimate coercion. But agreement on such norms requires consensus that great powers currently lack.
The insight of weaponized interdependence is that connection creates not only opportunity but also vulnerability. The integrated global economy that produced prosperity also produced dependencies that can be exploited. Managing this reality—maintaining the benefits of interdependence while limiting its weaponization—will be a central challenge of twenty-first-century statecraft.