This is an extract from Chapter 1 of the project report - click here for the full report
The hallmark of Weaponised Trade is the strategic use of trade to advance (geo)political objectives, typically to coerce the other party into changing behaviour.
The dataset revealed a broad range of political motivations for the weaponisation of trade, and in doing so provides useful insights into the types of provocations that may be more likely to induce an incident of Weaponised Trade. As the following table sets out, there are five frequently-observed types of political motivation, although these are not neat analytical categories and some disputes will fall into multiple categories, or vary over time. Additionally, there is a category of general relationship breakdown, which can stem from one or more of the other justifications. We examine each in more detail in the sections below.
1. National Security and Strategic Dependence
This is one of the most frequently-occurring justifications for Weaponised Trade. In these cases, the objective is not simply to cause economic pain but rather to dismantle strategic dependencies on a country that is perceived as a potential threat to national security. The large number of cases targeting Chinese 5G infrastructure providers gives an illustration of this dynamic. The United Kingdom, Romania, France, Portugal, Sweden, Denmark, Latvia, Costa Rica, Australia, Japan and the Netherlands all sought to ban companies such as Huawei and ZTE from providing infrastructure for their 5G networks, citing national security concerns.[1] Some, such as Costa Rica, based the ban on a country’s failure to sign the Budapest Convention on Cybercrime, which excluded a range of foreign providers including those from China.[2]
Similar motivations can also be seen in the case of export restrictions. For example, the Netherlands in 2023 implemented a licencing system requiring Dutch firms to seek licenses before exporting advanced deep ultraviolet lithography system technology. Dutch trade minister Liesje Schreinemacher justified the move as “in the interest of our national [3]Media reported that the Government of the Netherlands had also prevented the Dutch company ASML from servicing its machines located in China.[4]
In other cases, national security has been cited but been widely believed to be spurious and more akin to a smokescreen. For example, between 2019 and 2023, the Japanese Government removed South Korea from its high tech export ‘White List’ (on which South Korea had been listed since 2004). National security concerns were cited about South Korea’s failure to restrict resale with North Korea, but it was more widely believed that the dispute stemmed from historic wrongs.[5]
2. Territorial Disputes
Several cases in the Asia-Pacific were attributed to territorial disputes – both land and maritime. For example, China’s de-facto ban on rare earth, tungsten and molybdenum exports to Japan in September 2010, despite denials by China, was seen as retribution for the collision and subsequent arrest of a Chinese fishing vessel in disputed territory of the Senkaku/Diaoyu islands.[6] In 2012, the Philippines accused China of implementing restrictions on Philippine bananas as a weapon in the dispute over the Scarborough Shoal in the South China Sea.[7] In 2014, apparently in response to Vietnamese complaints about the establishment of a Chinese oil rig in disputed waters amongst the Paracel Islands, Vietnamese lychees were subject to informal import bans, with reports that shipments were left to rot at the border.[8]
Unwelcome third party responses to sovereignty disputes can also motivate weaponisation. For example, engagement with Taiwan has caused retaliation by China against Lithuania,[9] Guatemala,[10] the Netherlands,[11] and Eswatini.[12]These countries typically allowed the opening of a representative office of Taiwan in their territory, maintained diplomatic relations with Taiwan, or expanded official and semi-official engagement with Taiwanese authorities in ways perceived by Beijing as inconsistent with the “One China” principle.[13]
3. Armed Conflict and Military Buildup
A significant number of cases are clustered around responses to armed conflict, with measures often being described as sanctions, although they are unilateral rather than sanctions enacted by the UN Security Council pursuant to Article 41 of the UN Charter.[14]
In many of these cases, there is mutual instigation and targeting of measures, with one or both asserting that they are the victims of Weaponised Trade. For example, the Russian Ambassador to the United States described sanctions imposed on Russia as “a defective tool of political coercion”.[15] As one analyst explained,
“Europe also used energy against Russia by imposing an embargo on Russian coal, oil and implementing an oil price cap. […] This shows Europe wasn’t just a passive target of energy coercion; it also weaponised trade leverage in return. […] However, the EU felt morally and strategically justified given the stakes of the war.”[16]
Military buildup is also a prompt for weaponised trade. When South Korea decided to allow the installation of the US THAAD anti-missile system, China purportedly banned South Korean entertainment from broadcast, although this was disputed by China.[17] At the same time, Chinese authorities appeared to target South Korean multinational corporation Lotte, in relation to a wide range of investigations for fire safety, sanitation, and tax issues. By March 2017, 74 of Lotte’s 99 outlets in China had been shut, while the company itself closed a further 13 stores in response to the combined effects of regulatory restrictions and consumer boycott.[18]
4. Domestic Affairs, Governance and Human Rights
Governance issues and human rights form one of the earliest, and one of the most visible, categories of Weaponised Trade. The foundational literature has long suggested that trade measures are used to signal disapproval of political values, institutional choices, and symbolic acts and induce a change of policy position. For example, Fuchs and Klann identified a “trade-deteriorating effect” associated with official meetings with the Dalai Lama during the Hu Jintao period 1991-2008, finding a correlated decline in exports to China for a period of roughly two years following such meetings.[19] It demonstrates how conduct framed by the one state as normal diplomatic or political actions may be framed by another state as sufficiently hostile to justify economic pressure. Our database, which tracks incidents globally across the 2005 to 2024 period, suggests that this dynamic has persisted and arguably broadened.
For example, in December 2016 China imposed new fees and tariffs on cross border commodity trade with Mongolia, alongside administrative disruptions at key crossings, resulting in long queues of trucks unable to pass. These measures were accompanied by the cancellation of bilateral diplomatic meetings and delays to negotiations on a proposed US$4.2 billion loan intended to support the Mongolian economy. Although the Chinese government did not formally acknowledge the imposition of these trade measures, they occurred immediately following a four day visit to Mongolia by the Dalai Lama in November 2016. Official Chinese statements during this period focused not on trade policy but on the ‘negative impact’ of the visit on bilateral relations, sharpening concerns about weaponisation.[20] The Mongolian government shifted from its initial position that the visit was beyond its control to an explicit expression of regret, coupled with a commitment that the Dalai Lama would not be permitted to visit again during the administration. Subsequent diplomatic exchanges included further statements acknowledging Chinese territorial claims over Tibet, while Chinese officials indicated that Mongolia should “learn lessons” from the episode.[21] By early 2017, China had agreed to proceed with economic support measures, with both sides signalling a reset in relations. The sequence of events appears to illustrate a pattern in which economic measures are neither fully denied nor formally justified on governance grounds, but are instead embedded within a broader diplomatic signalling framework that nonetheless induces observable policy change in the target state.
In July 2019, Japan removed South Korea from a list of trusted trading partners and imposed export restrictions on three materials destined for South Korea – hydrogen fluoride, fluorinated polyimide and photoresist, which are important materials for the South Korean superconductor manufacturing industry.[22] The delisting meant that Japanese exporters would need to apply for a licence, which could take up to 90 days.[23] Prime Minister Shinzo Abe cited national security concerns as the reason for the restrictions.[24] However, South Korea claimed the restrictions were in response to 2018 and 2019 South Korean calls for the Japanese government to compensate South Korean “comfort women”,[25] and for Japanese companies to compensate South Korean workers who were exploited and enslaved during WWII.[26] As King explains, relations were restored by a ‘face saving’ mechanism in 2023 that allowed for a government-administered compensation fund that removed the requirement for Japanese companies to contribute.[27]
A similar dynamic appears in the India–Malaysia palm oil dispute beginning in late 2019 and early 2020. Following public criticism by Malaysian Prime Minister Mahathir Mohamad of India’s Citizenship Amendment Act and the Indian government’s actions in Kashmir, India introduced restrictions affecting imports of refined palm oil from Malaysia, which at that time was one of the world’s largest exporters. Observers characterised the retaliation as being linked to Malaysia’s political criticism. Notwithstanding the intensity of the dispute, the measures were relatively short-lived, with trade flows resuming within months, but the mechanism was used to effectively impose diplomatic costs and signal the instigator’s political resolve to both its domestic and international audiences.[28]
A more overt linkage between motivation and action took place between Malaysia and North Korea in 2017. Malaysia banned all imports from North Korea (but continued to export to North Korea) following the apparent assassination by North Korean agents at Kuala Lumpur Airport of the Korean leader’s half brother. Prior to that time, Malaysia had been one of the few states to continue trading with North Korea.[29]
Other cases have involved sensitivities to issues happening in the target’s territory, rather than being an act by the target government. This was the case in 2010, where China imposed border restrictions on Norwegian salmon (discussed in more detail in section 2.9.2 below). The restrictions were in “apparent retribution” for the Nobel Peace Prize being awarded to Chinese dissident and human rights activist Liu Xiaobo, despite the Nobel Committee being an independent organisation not formally connected with the Norwegian Government, beyond the Norwegian Parliament having a limited role in appointing the members of the Nobel Committee.[30]
5. Relationships with Third Countries
Some instances of Weaponised Trade are about pressuring a country to change its relationship with a third country, or implemented by the instigator at the urging of a third country. For example, embargos against Qatar by Saudi Arabia, Egypt, Bahrain and the United Arab Emirates were at least in part to pressure Qatar to cut ties with Iran.[31] Similarly, the North Korea-Malaysia dispute described above was arguably brought to a head due to US pressure on Malaysia uphold the US line on sanctions against North Korea.[32]
Secondary sanctions are also designed to put pressure on the relationship with a third country. For example, the European Union, Canada and the UK were criticised as weaponizing trade against China in order to pressure China’s relationship with Russia. China Daily argued, “It is wishful thinking for Canada, the EU and the UK to believe they can employ coercive means such as economic sanctions to exert pressure on China in the hope that the latter will change its stance to be in line with theirs.”[33]
Specific tensions have also arisen around diplomatic recognition of third countries – most notably China’s measures against Lithuania, Guatemala, Palau, the Netherlands and Eswatini over their diplomatic relationships with Taiwan.[34]For example, Palau is one of a limited number of states that have formal diplomatic recognition of Taiwan, and Lithuania’s removal from the Chinese customs database was said to have been prompted at least in part by the opening of a Taiwanese Representative Office in Vilnius, as well as the downgrading of diplomatic relations between the two countries.[35] Just over one-third of all China-instigated weaponised trade cases in the database are connected to Taiwan-related political or diplomatic issues.
6. Broad Relationship Rupture
The final category that may prompt the weaponisation of trade is a broader rupture or deterioration in the political relationship between the instigator and the target. In these situations, the coercive measures are not usually responding to a single triggering event or discrete policy disagreement, but instead emerge from an accumulation of tensions, grievances, strategic distrust, or geopolitical rivalry. The resulting measures may therefore be more diffuse, prolonged, and multi-sectoral than coercive actions linked to a specific territorial dispute, diplomatic incident, or human rights controversy.
In some cases, the rupture is comprehensive, affecting almost all aspects of the bilateral relationship. In others, the deterioration remains concentrated within politically sensitive sectors while broader economic engagement continues.
The tensions between Australia and China from approximately 2018 to 2022 illustrate this dynamic. The rupture was precipitated by a deterioration in relationship between the two governments across a wide range of political issues, discussed further in Section 2.10.2 below. While there were multiple incidents of Weaponised Trade impacting barley, coal, lobster, wine, timber, hay & chaff, grapes, copper, beef & lamb, and cotton,[36] other Australian exports, particularly iron ore, continued, and Australia’s exports to Chine reached an all time high in mid-2021. [37] The incident was relatively brief given the long history of trade between Australia and China, with tensions being primarily between governments rather than involving industries or the general public.
By contrast, the measures imposed against Qatar by Saudi Arabia, Bahrain, the United Arab Emirates, and Egypt in 2017 reflected a far more comprehensive breakdown in relations. The “Quartet” measures involved not only restrictions on trade, but also diplomatic severance, transport blockades, restrictions on aviation and shipping access, and expulsion measures affecting Qatari nationals, disrupting commercial and individual relationships.[38]
It is not always possible to identify cause and effect. Over time, disputes may ‘niggle’ and accumulate and become mutually reinforcing, transforming isolated coercive incidents into broader patterns of antagonism and relationship rupture. In this sense, Weaponised Trade can serve as both a symptom and an accelerant of deteriorating geopolitical relationships.
[1] ‘Telecommunications’, Weaponised Trade and Economic Coercion Case Study Database <https://economiccoercion.com/tag/telecommunications/>.
[2] ‘5G Infrastructure: China–Costa Rica’, Weaponised Trade and Economic Coercion Case Study Database <https://economiccoercion.com/2023/08/31/5g-infrastructure-china-costa-rica/>.
[3] Liesje Schreinemacher, Minister for Foreign Trade and Development Cooperations (Netherlands) quoted in Toby Sterling, ‘Dutch curb chip equipment exports , drawing Chinese ire’, Reuters (online, 30 June 2023).
[4] ‘Semiconductor Technology: China–Netherlands’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/2023/06/30/semiconductor-technology-china-netherlands/>.
[5] ‘Chemicals / High Tech List: South Korea–Japan’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/2019/07/31/chemicals-high-tech-list-south-korea-japan/>.
[6] ‘Rare earths: Japan–China’, Weaponised Trade and Economic Coercion Case Studies Database<https://economiccoercion.com/2010/09/30/rare-earths-china-japan/>.
[7] ‘Bananas: Philippines–China’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/2024/10/23/bananas-philippines-china>.
[8] ‘Lychees: Vietnam–China’, Weaponised Trade and Economic Coercion Case Studies Database<https://economiccoercion.com/2014/05/01/lychees-vietnam-china/>. See also Viet Dung Trinh, ‘Vietnam’s nuanced securitization of China’s assertiveness in the South China Sea’ (2025) 39(2) The Pacific Review 263. <https://doi.org/10.1080/09512748.2025.2532614>.
[9] ‘Customs Database: Lithuania–China’, Weaponised Trade and Economic Coercion Case Studies Database<https://economiccoercion.com/2021/11/30/customs-database-lithuania-china/>.
[10] ‘Coffee and Macadamias: Guatemala–China’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/2024/05/31/coffee-and-macadamias-guatemala-china/>.
[11] ‘Medical Supplies & Boycott Threat: Netherlands–China’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/2020/04/30/netherlands/>.
[12] ‘Travel Restrictions: Eswatini–China’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/2020/01/31/travel-restrictions-eswatini-china/>.
[13] See also Wendy Cutler and Shay Wester, Resilience & Resolve: Lessons from Lithuania’s Experience with Chinese Economic Coercion(Report, Asia Society Policy Institute, 17 April 2024) <https://asiasociety.org/policy-institute/resilience-resolve-lessons-lithuanias-experience-chinese-economic-coercion>.
[14] This dynamic is discussed in more detail in Section 2.9.6 below.
[15] Anatoly Antonov, ‘Sanctions against Russia: a defective tool of political coercion’ (Article, Embassy of the Russian Federation in the USA, 11 March 2023) <https://washington.mid.ru/en/press-centre/news/ambassador_anatoly_antonov_s_article_sanctions_against_russia_a_defective_tool_of_political_coercion>.
[16] Gianmarco Geneletti, ‘Energy as a geopolitical weapon’, European Relations (Web Page, 24 August 2025) <https://europeanrelations.com/energy-as-a-geopolitical-weapon/>.
[17] ‘Entertainment: South Korea–China’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/2016/08/31/entertainment-south-korea-china/>.
[18] ‘Lotte Group: South Korea–China’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/2016/12/31/lotte-group-china-south-korea/>.
[19] Fuchs, Andreas, and Nils-Hendrik Klann. ‘Paying a Visit: The Dalai Lama Effect on International Trade’ (2013) 91(1) Journal of International Economics 164. <https://doi.org/10.1016/j.jinteco.2013.04.007>.
[20] ‘Mining Commodities: Mongolia–China’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/2016/11/30/mining-commodities-mongolia-china/>.
[21] Ibid.
[22] Stephen Ezell, Understanding the South Korea-Japan Trade Dispute and its Impacts on U.S. Foreign Policy (Blog Post, 16 January 2020) <https://itif.org/publications/2020/01/16/understanding-south-korea-japan-trade-dispute-and-its-impacts-us-foreign>.
[23] Pushan Dutt, ‘How a Century-Old Dispute Between Japan and South Korea Threatens the Global Supply of Smartphones’, The Conversation (online, 29 August 2019) <https://theconversation.com/how-a-century-old-dispute-between-japan-and-south-korea-threatens-the-global-supply-of-smartphones-122502>.
[24] See Prime Minister Abe’s remarks as cited in ‘Japan says curbs on exports to South Korea due to broke pledge’, Voice of Australia (online, 3 July 2019) <https://www.voanews.com/a/east-asia-pacific_japan-says-curbs-exports-south-korea-due-broken-pledge/6171071.html>.
[25] Yosuke Onchi, ‘South Korean Court Orders Japan to Pay Former ‘Comfort Women’, Nikkei Asia (online, 8 January 2021) <https://asia.nikkei.com/Spotlight/Japan-South-Korea-rift/South-Korean-court-orders-Japan-to-pay-former-comfort-women>.
[26] Yuka Obayashi and Hyonhee Shin, ‘Nippon Steel to Appeal South Korea Asset Seizure Ruling as Case Threatens Bilateral Ties’, Reuters (online, 4 August 2020) <https://www.reuters.com/article/us-southkorea-japan-labourers-nippon-ste/nippon-steel-to-appeal-south-korea-asset-seizure-ruling-as-case-threatens-bilateral-ties-idUSKCN25009T>.
[27] Kaitlyn King, Japanese and South Korean Economic Decision-Making: The 2019 Trade Dispute and Retaliatory Policy (MA Thesis, George Washington University, 2023) <https://scholarspace.library.gwu.edu/downloads/n009w302j?disposition=inline&locale=en>.
[28] ‘Palm Oil: Malaysia-India’, Weaponised Trade and Economic Coercion Case Study Database<https://economiccoercion.com/2019/10/31/palm-oil-malaysia-india/>.
[29] ‘Import Ban: North Korea–Malaysia’, Weaponised Trade and Economic Coercion Case Study Database<https://economiccoercion.com/2017/06/30/import-ban-north-korea-malaysia/>.
[30] ‘Salmon: Norway–China’, Weaponised Trade and Economic Coercion Case Studies Database<https://economiccoercion.com/2010/10/08/salmon-norway-china/>.
[31] ‘Qatar’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/tag/qatar/>.
[32] James Chin, ‘North Korea and Chinas predictable diplomatic divorce’, The Interpreter (Lowy Institute , online, 22 March 2021) <https://www.lowyinstitute.org/the-interpreter/north-korea-malaysia-s-predictable-diplomatic-divorce>.
[33] Editorial, ‘Politicizing trade with sanctions is blinkered, futile and self-harming’, China Daily (online, 26 February 2025) <https://www.chinadaily.com.cn/a/202502/26/WS67bf0103a310c240449d76fe.html>.
[34] See: ‘Customs Database: China–Lithuania’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/2021/11/30/customs-database-lithuania-china/>, ‘Coffee and Macadameias: Guatemala–China’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/2024/05/31/coffee-and-macadamias-guatemala-china/>, ‘Tourism: Palau–China’, Weaponised Trade and Economic Coercion Case Studies Database https://economiccoercion.com/2017/11/30/tourism-palau-china/ , ‘Medical Supplies & Boycott Threat: Netherlands–China’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/2020/04/30/netherlands/>, and ‘Travel Restrictions: Eswatini–China’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/2020/01/31/travel-restrictions-eswatini-china/>.
[35] Customs Database: China–Lithuania’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/2021/11/30/customs-database-lithuania-china/>.
[36] ‘Australia’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/tag/australia/>.
[37] Department of Foreign Affairs and Trade (Cth), DFAT Declassified – LEX5124 (FOI Disclosure, Reference LEX5124, 12 May 2022) <https://www.dfat.gov.au/sites/default/files/dfat-foi-lex5124.pdf>. See also, Australian Exports to China, Trading Economics (Web Page) <https://tradingeconomics.com/australia/exports-to-china>.
[38] ‘Qatar’, Weaponised Trade and Economic Coercion Case Studies Database <https://economiccoercion.com/tag/qatar/>.
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