Focus on the Global South / Global Policy Analysis, 2025–2026.
Focus: Geoeconomics, economic coercion, and strategies for resisting weaponized interdependence.
Abstract: This article examines the strategies available to states and non-state actors for resisting the "weaponization of interdependence" — the use of asymmetric economic dependencies as instruments of political coercion. Drawing on case studies from China-Australia trade disputes, US financial sanctions on Iran and Russia, and technology export controls, we identify three classes of resistance strategies: (1) diversification and decoupling; (2) coalition-building and counter-leverage; and (3) narrative contestation and norm entrepreneurship. We argue that effective resistance requires combining all three dimensions, and that the Global South faces particular challenges in developing the institutional and coalitional capacities necessary for robust resistance.
1. Introduction: The Politics of Economic Coercion
The concept of "weaponized interdependence," developed by Farrell and Newman (2019) in a landmark article in International Security, captures a distinctive feature of contemporary geopolitical conflict: the use of centrally-positioned nodes in global economic networks — financial clearing systems, semiconductor supply chains, internet exchange points, payment networks — as instruments of coercive leverage against states and firms that depend on access to them.
The United States' dominant position in global financial infrastructure — particularly the SWIFT interbank messaging system and the dollar-clearing apparatus administered by US correspondent banks — has made it uniquely effective at deploying economic weaponry. US secondary sanctions on Iran (2012–2018, 2019–present) and on Russia (2022–present) have demonstrated that control over key nodes in global financial networks allows the US to impose extraterritorial coercive effects far beyond its own jurisdiction, compelling third-country firms and governments to choose between access to US-linked financial infrastructure and continued economic relations with sanctioned states.
The growing deployment of such instruments has generated acute concerns in the Global South about economic sovereignty. For states that lack significant positions in global economic networks — that are network peripheries rather than network hubs — the threat of weaponized interdependence creates a coercion vulnerability that conventional military power cannot offset. This article examines what resistance to such coercion looks like in practice.
2. The Farrell-Newman Framework and Its Extensions
Farrell and Newman's original framework identified two key properties of global economic networks that enable weaponized interdependence: panopticon effects (the ability of hub-state actors to observe and gather intelligence through network traffic) and chokepoint effects (the ability to interrupt or threaten to interrupt network access for targeted actors). They argued that states with disproportionate network positions could translate these structural advantages into coercive power.
Subsequent scholarship has extended and challenged the framework in important ways. Drezner (2021) has argued that the framework overstates the effectiveness of economic coercion by underestimating target-state resilience and the political costs of weaponization for hub states themselves. Farrell and Newman's model assumes that coercive capacity translates into political compliance, but historical evidence suggests a more complex relationship: states subjected to economic coercion frequently absorb substantial economic costs rather than making demanded political concessions (Cuba, Iran, Russia, North Korea all illustrate the limits of comprehensive sanctions as compliance instruments).
More recently, attention has shifted from the conditions under which economic coercion succeeds to the strategies through which target states resist it. This article contributes to this emerging resistance literature.
3. Three Strategies of Resistance
3.1 Diversification and Decoupling
The most straightforward resistance strategy is reducing dependency on vulnerable network positions. This can take multiple forms: geographic diversification of trade and investment partners, development of alternative financial infrastructure, and creation of substitute technology platforms that reduce dependence on US or Western-controlled systems.
China's CIPS (Cross-Border Interbank Payment System) — launched in 2015 and significantly expanded since 2022 — represents the most ambitious attempt to build alternative financial infrastructure as a hedge against dollar weaponization. CIPS has grown substantially in membership and transaction volume since Russia's 2022 exclusion from SWIFT demonstrated the potential of financial weaponization, but it remains a fraction of SWIFT's global transaction volume and is heavily concentrated in Chinese counterparties. True network alternative would require persuading large numbers of non-Chinese financial institutions to route significant transaction volumes through CIPS, which requires both technical investment and a willingness to accept reputational and regulatory risks.
For most Global South states, the decoupling option is practically constrained by the depth of existing integration with US-centered networks. Unwinding dollar-denominated debt, diversifying away from US financial institutions, and rebuilding technology infrastructure without Western components requires sustained investment and policy commitment over long time horizons. Most middle-income states lack both the fiscal resources and the geopolitical flexibility to pursue comprehensive decoupling.
3.2 Coalition-Building and Counter-Leverage
A second resistance strategy involves coalition-building — aggregating political and economic leverage across multiple states to raise the costs of weaponization for hub-state actors. This is the logic behind ASEAN's resistance to taking sides in China-US competition and behind the broader "strategic autonomy" discourse in EU trade policy.
The China-Australia trade dispute of 2020–2023 illustrates both the potential and the limits of this approach. When China imposed formal and informal trade barriers on Australian barley, wine, beef, coal, and other commodities in response to Australia's call for an independent COVID-19 origins inquiry, Australia's initial response was to diversify its export markets. Within eighteen months, Australian wheat, beef, and wine had substantially redirected toward alternative markets in India, Southeast Asia, and the Middle East. China's coercion achieved the opposite of its intended effect, demonstrating to other potential targets that economic diversification was feasible even in the short run.
However, coalition-building against US weaponized interdependence is more difficult than resisting China's economic coercion, because the US dollar's global reserve currency status and the depth of US financial market integration create dependencies that are qualitatively different from China's commodity-import leverage. No viable coalition of dollar-excluded states currently exists that could impose meaningful counter-costs on the US financial system.
3.3 Narrative Contestation and Norm Entrepreneurship
A third resistance strategy operates at the level of international norms — contesting the legitimacy of weaponized interdependence and promoting alternative international legal frameworks that constrain its deployment. This is the strategy implicit in the Global South's consistent criticism of "unilateral coercive measures" in UN General Assembly resolutions and in the efforts of states like India, South Africa, and Brazil to build consensus around principles of economic non-interference.
Norm entrepreneurship in this domain faces fundamental challenges. The states most capable of deploying weaponized interdependence — primarily the United States, but also China — are also permanent members of the UN Security Council, making formal prohibition through Security Council resolution effectively impossible. The WTO dispute settlement system has been partly deployed against trade-based coercion, but the WTO's authority over financial sanctions is effectively nil, and the Trump administration's systematic undermining of the Appellate Body has further weakened trade dispute settlement as a resistance mechanism.
4. The Global South's Particular Vulnerabilities
The Global South faces distinctive challenges in resisting weaponized interdependence that are not simply generalized versions of the challenges facing all states. Three structural features are particularly relevant.
First, the Global South's financial systems are disproportionately dependent on correspondent banking relationships with major US and European banks. De-risking — the withdrawal of US and European correspondent banking from perceived high-risk jurisdictions — has already severely disrupted financial systems in Caribbean, Pacific, and African states, demonstrating that the Global South can be subject to financial exclusion as a side effect of regulatory risk management even without direct sanctions targeting.
Second, Global South states are disproportionately represented in the extractive commodity sectors most vulnerable to supply chain weaponization — rare earth minerals, cobalt, lithium, and other critical materials for energy transition. While this creates leverage opportunities (as demonstrated by China's 2023 restrictions on gallium and germanium exports), it also creates vulnerability to counter-weaponization if Western states develop alternative supply chains or successfully organize monopsonistic purchasing arrangements.
Third, the debt vulnerabilities of many Global South states — particularly those that took on substantial Chinese BRI financing and are now navigating debt renegotiations — create conditionality vulnerabilities that function analogously to financial weaponization even without explicit coercive intent. IMF structural adjustment conditionalities and Chinese debt renegotiation terms both involve leveraging economic dependencies to shape policy choices of debtor governments.
5. Conclusions: A Geoeconomics of Solidarity?
Resisting weaponized interdependence in the Global South requires a combination of the three strategies identified here, pursued simultaneously and with realistic assessments of what each can achieve. Diversification reduces but does not eliminate vulnerability; coalition-building provides protection against some coercers but not others; narrative contestation is a long-run investment with uncertain payoffs.
What the analysis reveals is that effective resistance is fundamentally a collective action problem. Individual states cannot develop the network positions, institutional capacities, or political leverage to resist major-power coercion alone. The vision of a "geoeconomics of solidarity" — in which Global South states build shared financial infrastructure, coordinate negotiating positions, and support each other's norm entrepreneurship — is analytically compelling but faces enormous coordination challenges given the divergent interests, geopolitical alignments, and economic vulnerabilities of potential coalition members.
The emerging Global South coalition in forums like BRICS+, the G77, and the New Development Bank provides a partial institutional foundation for such solidarity, but its coherence and effectiveness remain limited. Building the capacities needed for effective resistance to weaponized interdependence will require sustained investment in international institution-building of a kind that the current fragmentation of Global South politics makes very difficult.
Published in: Focus on the Global South / Global Policy Analysis, 2025–2026. The authors acknowledge support from the Transnational Institute (TNI) and the Rosa Luxemburg Foundation.