U.S.-China weaponize interdependence

Why it matters

The Council on Foreign Relations said on May 26 that Washington and Beijing are increasingly using economic ties as instruments of state power rather than as neutral channels for trade. In a short essay published under CFR’s new Future of American Strategy initiative, the think tank said the United States has used access to its market as leverage, while China has used control over parts of the supply chain, including critical minerals, in response to U.S. pressure. Euronews reported on May 26 that the European Union remains structurally dependent on China in five industrial sectors, adding to pressure on Brussels as it tries to reduce strategic vulnerabilities. The report said concern intensified after U.S. tariffs on Chinese goods raised fears that excess Chinese output could be redirected into Europe at lower prices. (cfr.org) World Radio Switzerland reported on May 26 that Geneva could be left paying part of the security cost for the June 15-17 G7 summit in Évian, just across the French border. The outlet, citing 24 heures, said Paris had rejected Bern’s requests to share policing costs even as Geneva prepared for demonstrations expected on June 14. ### How are the United States and China using trade ties as leverage? (euronews.com) The CFR essay said economic power is now less about setting rules through institutions and more about controlling choke points inside global networks. It said President Donald Trump had weaponized access to the U.S. market, while China had answered by using its dominance in critical mineral supply chains. (worldradio.ch) China’s role in those supply chains matters because advanced economies still depend on Chinese production for inputs needed in energy, manufacturing and defense-related industries. CFR framed that as a strategic lesson from the past year: interdependence can create coercive leverage for both sides, not just efficiency gains for global commerce. (cfr.org) ### Which five sectors are worrying Brussels? Euronews said the EU’s exposure to China is concentrated in solar energy, critical raw materials, industrial robotics and two other industrial segments it described as structurally dependent on Beijing. The report said those dependencies sit alongside wider concern in Europe over Chinese industrial overcapacity and the risk of import surges. (cfr.org) Ursula von der Leyen, president of the European Commission, sharpened that message at the G7 by calling the situation “a new China shock,” according to Euronews. The report linked that warning to fears that Chinese producers, shut out of the U.S. market by tariffs, could push more goods into Europe instead. (euronews.com) ### Why does this lead to higher costs at home? The EU’s response to strategic dependence has centered on “de-risking,” a policy that seeks to diversify suppliers without fully severing trade ties with China. But building backup capacity, duplicating supply chains and financing domestic production all carry costs for governments and companies. Euronews said the issue is no longer confined to trade balances and now reaches industrial policy and economic security. (euronews.com) Geneva’s dispute over summit policing shows how those costs can spill beyond tariffs and factories. World Radio Switzerland said four Geneva parliamentarians criticized what they called a lack of French solidarity as the canton faced the prospect of policing an event it is not hosting. ### Why is the G7 summit part of this story? The Swiss foreign ministry said France will host the G7 summit in Évian from June 15 to June 17, with G7 leaders, the European Union and invited heads of state expected to attend. (euronews.com) Switzerland said it was taking measures in preparation because of the summit’s location near the Swiss border. That makes Évian the next visible forum where trade, industrial dependence and allied burden-sharing are likely to converge. (worldradio.ch) Geneva’s preparations, including expected demonstrations and security planning, show that the effects of geopolitical rivalry are reaching local authorities as well as national governments. ### What comes next? June 14 is the date Geneva is preparing for major demonstrations linked to the Évian summit, according to World Radio Switzerland. (eda.admin.ch) June 15-17 is when the G7 meeting itself will take place, according to the Swiss foreign ministry, with the European Union among the participants. (worldradio.ch)

Key numbers

• The Council on Foreign Relations said on May 26 the United States and China are using market access and supply-chain dominance as strategic leverage.
• The Council on Foreign Relations said on May 26 that Washington and Beijing are increasingly using economic ties as instruments of state power rather than as neutral channels for trade.
• Euronews reported on May 26 that the European Union remains structurally dependent on China in five industrial sectors, adding to pressure on Brussels as it tries to reduce strategic vulnerabilities.
• (cfr.org) World Radio Switzerland reported on May 26 that Geneva could be left paying part of the security cost for the June 15-17 G7 summit in Évian, just across the French border.

What happens next

• The Council on Foreign Relations said on May 26 that Washington and Beijing are increasingly using economic ties as instruments of state power rather than as neutral channels for trade.
• Euronews reported on May 26 that the European Union remains structurally dependent on China in five industrial sectors, adding to pressure on Brussels as it tries to reduce strategic vulnerabilities.
• tariffs on Chinese goods raised fears that excess Chinese output could be redirected into Europe at lower prices.

Sources

• cfr.org
• euronews.com
• worldradio.ch
• eda.admin.ch

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