The Rise of Economic Coercion: Instruments, Illegality, and UN Charter Remedies

Introduction

Since its creation during the San Francisco Conference in 1945, the main objective of the UN (1945), according to the preamble of its constitutive treaty, has been to promote international peace and security by saving “succeeding generations from the scourge of war, which twice in our lifetime has brought untold sorrow to mankind”. Following the antecedent of the Briand-Kellogg Pact, article 2-4 of UN Charter establishes a general prohibition to use force in the relations between states. Pursuant to article 1-1 of the charter, the organization’s function in the maintenance of international security is aimed at preventing and alleviating threats to peace, breaches of peace and acts of aggression, and, by virtue of article 24 of the charter, its main political organ- the Security Council- holds the primary responsibility in the fulfillment of this function. The UN Charter does not contain a definition of “threats to peace”, “breaches of peace” or “acts of aggression”. Yet, in the practice of the organization and the resolutions of the General Assembly and the Security Council, these terms have mainly been used to refer to situations involving the use of armed force between states. Therefore, the UN’s role in the maintenance of international peace and security has traditionally been understood as primarily concerned with preventing and responding to situations involving the use of armed force between states.

However, the maintenance of international peace and security does not rely only on the absence of military conflicts. The word security etymologically derives from the Latin sine cura (without care, without concern) and implies that individuals should be able to act without fear and worry, minimizing harm, deprivation, suffering, and anguish. For international relations scholars, international security entails alleviating threats to shared values of the members of the international community. For international law scholars, international security implies responding to threats to the interests and territorial integrity of states (Williams, 2009, p.6). This vision of international security traditionally involves a state-centered perspective which identifies it with national security. In a broad understanding, the concept of national security deals with resilience against any threat to the autonomy, internal stability or territory of the nation-state, encompassing both military and non-military threats (Retter, 2020). According to a 2005 report of the UN High Level Panel on Threats, Challenges and Change (UN, 2005), the threats to international peace and security in the twenty-first century include not just international war and conflict, but civil violence, organized crime, terrorism and weapons of mass destruction. They are also related to poverty, deadly infectious diseases, and environmental degradation, since these can have equally catastrophic consequences (Simma, 2024).

In a globally interconnected and interdependent world order, the economy is intimately connected with both national and international security (US Department of Commerce, 2018), because powerful countries no longer abide by the primacy of economics and use economic coercion as a geopolitical arm (Edler, 2023). From a general perspective, economic coercion can be defined as the use of economic means to force a country or entity to act against its will or change its policies. It involves leveraging economic power to compel a target to concede to demands, often through economic threats or the imposition of “economic pain”. In other words, economic coercion relies on the use of economic measures as an instrument for forcing another nation to adjust its national or foreign policy or for obtaining economic advantages over or concessions from the victim State (Katz Cogan, 2024). According to article 2 of the 2023 EU Regulation on the Protection of the Union and its Member States from Economic Coercion by Third Countries, economic coercion exists when a state: “interferes in the legitimate sovereign choices of the Union or a Member State by seeking to prevent or obtain the cessation, modification or adoption of a particular act by the Union or a Member State (…)” (European Union Regulation 2023/2675). According to a 1953 Soviet draft definition of an “act of economic aggression”: “State shall be declared to have committed an act of economic aggression which first commits one of the following acts: (a) Takes against another State measures of economic pressure violating its sovereignty and economic independence and threatening the bases of its economic life; (b) Takes against another State measures preventing it from exploiting or nationalizing its own natural richness; (c) Subjects another State to an economic blockade” (U.N. Doc. A/AC.66/L.2/Rev.1, 1953).

This article asks what explains the contemporary rise of economic coercion and through which instruments it operates, whether and to what extent such practices can be regarded as unlawful under the UN Charter, and what legal bases and institutional mechanisms the UN system provides to deter and respond to them. Based on the relevant international relations literature, the first part of the article will explain the reasons behind the increasing use of economic force in international relations and will analyze the new goal and the tools of economic violence that negatively impact international peace and security. The remainder of the article is devoted to our doctrinal legal analysis (Egan, 2018), grounded in the close examination of authoritative legal texts and relevant scholarly commentary to interpret the meaning of legal provisions and resolve ambiguities and inconsistencies in doctrine and jurisprudence, by applying structured deductive, analogical, and teleological reasoning to synthesize coherent legal principles. Against this backdrop, the second part of the article will (re)assess the illegality of the use of economic coercion under articles 2-4 and 2-7 of the UN Charter. Finally, the third part will study the actions that the UN can take to prevent the use of economic coercion and to restore international peace and security through the adoption of measures of individual or collective self-defense.

The Increasing Use of Economic Coercion and Its Impact on International Peace and Security

The increasing use of economic coercion in inter-state relations is a response to a completely new characteristic of the global economic order: strategic competition in midst of economic interdependence (Sullivan, 2023, p. 8). After the end of the Cold War, international law had promoted openness for trade and investment flows to foster economic interdependence between states (Ikenberry, 2020, p. 17-18), which was considered essential to achieve development (Miller, 2021, p. 1351). In the Kantian vision of international law, economic interdependence was a tool for (perpetual) international peace and security (Russett, 2001), because of the low costs of trade and investment as means for the appropriation of productive resources, considering the high costs of using military force (Miller, 2021, p. 1335). However, after the global economic and financial crisis, also known as the “Great Recession” in 2008, global inequality rose and it became clear that the economic interdependence advanced by international law reduced poverty, eliminated hunger and fostered prosperity for the few, but not for the lot (La Vía Campesina, 2021). Global inequality generated strong social conflicts and transformed drastically the domestic and international political map of the world. Economic interdependence began to be challenged by populist and nationalist movements in many countries across the globe (e.g. Italy, US, Brazil, Mexico, India, Hungary, Bulgaria, Türkiye, Zimbabwe, South Africa, etc.), whose agendas are aimed at ensuring congruence between the state and its people, ideally by breaking its ties to “external control” (Paul, 2021, p. 1328). In international politics, states are now engaged in a new and intense geopolitical struggle between a declining hegemonic power- the US- and new competing power poles. The military and non-military conflicts involving the US, China and other states such as Russia, India, Brazil or South-Africa (founding members of the BRICS group) are (re)-establishing geopolitical confrontational lines between (trustful) “allies” and “enemies”, or at least “strategic competitors”.

Strategic competition is a complex dynamic which can involve contending with adversaries across economic, technological, military or ideological fields without using armed force (US Department of State, 2024). Historically, the concept of strategic competition emerged amidst the détente era of the 1970s and was used to refer to the competition between the US and the USSR (Winkler, 2023, p. 333). Nowadays, it is employed to name the competition between the US and China, mainly in the economic sphere. The strategic competition between these two great powers is putting “competitive pressure” (Banasik, 2024, p. 29) on all the other states, forcing them to deploy competitive strategies to protect their essential interests (Leonard, 2019).

To be able to strategically compete within a deeply interdependent and interconnected global economy, states are using economic coercion to reach geopolitical attacks against strategic rivals. In the same logic, states are having recourse to economic force to protect themselves against other contenders’ adversarial economic actions and to reinforce their own economic capacity. In other words, states are increasingly deploying economic attacks against geopolitical rivals and are using economic violence to respond to risks of economic attacks from strategic competitors. The use of economic coercion, therefore, serves to protect states’ essential economic interests and to impose these interests on other states. This new dimension of economic coercion arises from the knowledge that in the context of extreme economic interdependence, states’ domestic economies have become too reliant upon the geopolitical actions of potential adversaries, with this excessive reliance posing a threat to national security.

In fact, in the context of strategic competition, economic interdependence is no longer a tool for (perpetual) peace, but rather an instrument for war (Schindler 2024, p. 10), as states can geopolitically leverage this interdependence, i.e. they can use economic interdependence as a geopolitical weapon to coerce strategic rivals. States have grown increasingly aware of the risks of trade, financial and supply chains dependencies arising from economic interdependence, as these dependencies provide states with power over each other, that can be geopolitically exploited. (World Economic Forum, 2016). In consequence, the main reason for the increasing use of economic coercion in the current global conjuncture arises from the “weaponization of economic interdependence”, or its use as a tool for economic attacks or even economic wars against strategic competitors.

Excessive reliance on economic interdependence in the midst of strategic competition and geopolitical rivalry can be concealed as a “vulnerability”, especially if states are not equally or symmetrically interdependent. In fact, states can be interdependent economically, but they do not depend on each other equally, as the “core” states, or the states in a “dominant position” from an anti-trust law perspective, can constrain the less powerful (or “peripheral”) economic partners (Waltz, 2010) by inflicting (or threatening to inflict) some level of “economic pain” on them. In Thucydides’ words, in a situation of asymmetrical economic interdependence, “the strong do what they can and the weak suffer what they must (Thucydides, 1999).” From this perspective, in a scenario of asymmetrical economic interdependence, economic interdependence can be used as a weapon of economic coercion. In this context, the “weaponization of economic interdependence” can be defined as a “condition under which an actor can exploit its position in an embedded network to gain a bargaining advantage over others in a contained system” (Columbia University School of International and Public Affairs Capstone Report, 2020). In a “weaponized economic interdependence” situation, states with political authority over central economic nodes “can weaponize networks to gather information or choke off economic and information flows, discover and exploit vulnerabilities, compel policy change, and deter unwanted actions” (Farrell, 2019, p. 42).

In the current context of strategic competition, powerful countries have not hesitated to leverage their economic dominance for geopolitical gain though the deployment of economically coercive measures. Many countries around the world have been put under economic attacks in a worldwide effort to weaponize states’ economic power. This weaponization has been achieved through new forms of economic coercion that represent a major challenge to international peace and security and to a ruled-based global order.

Economic coercion can imply the use of multiple tools (Gürcan, 2024). It can take the form of compulsive measures or economic sanctions such as boycotts, embargoes, or attempts by rival nations to freeze the victim-state's assets or dry up its markets on a global scale. States can also employ their foreign aid program coercively by offering aid as a reward for another country's pursuit of desirable policies and by withholding aid as a punitive measure to discourage the adoption of foreign policy action (Bucheit, 1974). Economic coercion can imply the use of even more sophisticated means such as extraterritorial sanctions, import or export controls or sensitive data transfers (Hackenbroich, 2020).

Frequently, economic violence relies on the implementation of trade or investment related tools (Regulation (EU) 2023/2675). In this context, “trade weaponization” can be defined as “the employment of trade tools to induce a trade partner to change its practices in any issue-area (including economic policy and diplomatic relations) by exploiting its economic vulnerabilities (Columbia University School of International and Public Affairs Capstone Report, 2020).” In other words, “trade weaponization” consists in the use of trade tools by a state that possess “centric” economic power to force (or extort) a “peripheral” state to obey the political will of the first. In a 2023, Joint Declaration Against Trade-Related Economic Coercion and Non-Market Policies and Practices, adopted by the Governments of Australia, Canada, Japan, New Zealand, the United Kingdom and the US, trade-related economic coercion was defined as a strategy which “uses, or uses the threat of, measures affecting trade (…) in an abusive, arbitrary, or pretextual manner to pressure, induce or influence a foreign government into taking, or not taking, a decision or action in order to achieve a strategic political or policy objective, or prevent or interfere with the foreign government’s exercise of its legitimate sovereign rights or choices” (USTR, 2023). The Joint Declaration was adopted after the G7 meeting in 2023 during which the member states of the group expressed strong concerns about being victims of the “weaponized trade” practices of China. China, on its part, has argued that the response of the G7 member states to this practice has also implied the use of “trade weaponization” methods (Nguyen, 2023).

“Weaponized trade” practices were developed in the US-Japan relations in 1940, during the “chicken wars” between the US and the EEC in the 1960s or in the US-OPEC countries relations during the Oil Crisis in the 1970s (Columbia University School of International and Public Affairs Capstone Report, 2020). There have been other recent examples of trade-related economic coercion in the relations between Russia and the EU after the beginning of the War in Ukraine, (Ruggi, 2023), China and Taiwan (Chaisse, 2024), Iran and the US (Ruggi, 2023), the US and China (Hopewell, 2022), and more generally the US and the rest of the world. For example, the asymmetrical economic interdependence developed in the North American Free Trade Area created “a perfect storm” conditions for “weaponized interdependence”, which permitted to US President Donald J. Trump to use trade-related economic coercion against Mexico during his first administration from 2017 to 2021 and after his second arrival at the White House in 2025. The main strategy of the US “weaponizer” has been to use the imposition of tariffs and/or the threat of imposition of tariffs to interfere with Mexico’s sovereign right to choose its domestic policies in two areas: migration and drug traffic control.

The use of export or import controls as a new form of trade-related economic coercion is currently being deployed by many states to limit strategic adversaries’ access to critical technologies. It is mainly used as a form of defensive strategy against the threat of economic coercion from rival states. For example, the US has begun to impose targeted import restrictions based on national security concerns that have prohibited the use of equipment from Chinese state-owned telecom megacompanies Huawei and ZTE in US telecommunications networks. In addition, the US Government announced measures that enable the Commerce Department to limit the import or use in its territory of a range of information and communications technology products and services. These measures served to limit the distribution of Chinese-owned apps TikTok and WeChat (CNAS, 2023). The export control measures against these Chinese companies had real impacts on the firms’ ability to obtain critical technology and to compete in the US market and at the global level.

Another tool for the adoption of defensive coercive measures against rival economic powers in the investment field are the new forms of investment screening mechanisms. For example, in 2018, the US Congress enacted a substantial expansion of the jurisdiction of the Committee on Foreign Investment in the US (CFIUS), giving it greater powers to review outbound investments and expanding the scope of the type of investments subject to review. CFIUS has not only become more assertive in reviewing prospective investments, but it has also vastly expanded its work to review already-completed investments that had not previously come before the committee, requiring divestment or other mitigation measures in several public cases. In addition, in January 2025, the US Government adopted new Provisions Pertaining to U.S. Investments in Certain National Security Technologies and Products in Countries of Concern, a rule which established a program to “prohibit or require notification of certain types of outbound investments by US persons into certain entities located in or subject to the jurisdiction of a country of concern, and certain other entities owned by persons of a country of concern, involved in specific categories of advanced technologies and products. The Outbound Order identifies three categories of national security technologies and products for the program: semiconductors and microelectronics, quantum information technologies, and artificial intelligence. In an Annex to the Outbound Order, the President identified the People’s Republic of China, along with the Special Administrative Regions of Hong Kong and Macau, as a country of concern” (US Department of Treasury, 2025). President Trump’s “America First Investment Policy” also focuses on the promotion of foreign investment from trustful allies and partners, while seeking to address threats posed by investment from strategic adversaries. In the EU, 24 member states now have national foreign direct investment screening mechanisms and in 2025 the EU Commission called on member states to review past, ongoing and new outbound investments in semiconductors, AI and quantum technologies (EU Commission, 2025).

The use of sanctions against Russia, Iran, and Venezuela is also very emblematic of the new tools of economic coercion that states are using in the current global conjuncture. Sanctions against Iran began after the 1979 revolution and have intensified over time, particularly with the US “maximum pressure” campaign initiated in 2018 (Sadeqi Mohammadi, 2025). Sanctions target various sectors of the Iranian economy, including energy, finance, shipping, and key individuals and entities (Dowlah, 2025, p. 126). The primary goal of sanctions is to coerce Iran to refrain from developing nuclear weapons, curb its support for terrorism, and limit its regional influence in the Middle East. Economic sanctions applied against Russia, mainly by the EU, but also the UK, the US, Canada and Australia are a form of economic coercion used by these nations to influence Russia's actions, particularly in response to its invasion of Ukraine (Morad, 2024). These sanctions involve various measures like trade restrictions, financial freezes, and travel bans. Their declared aim is to weaken Russia's economic capacity to sustain its military operations in Ukraine and to contain its regional and global influence (US Congress, 2025a). The US has also imposed individual, financial, and sectoral sanctions on the Venezuelan government, as well as sanctions on the Maduro government and its supporters. The US Congress enacted an entire law- the Venezuela Defense of Human Rights and Civil Society Act of 2014- to impose sanctions on people responsible for acts of violence, serious human rights abuses, or antidemocratic actions in Venezuela. These sanctions were extended through 2023, and their stated aim is to hasten “a return to democracy in Venezuela”, i.e. to change the “nondemocratic government in Venezuela” (US Congress, 2025b).

Recent uses of these new tools of economic coercion have demonstrated their potential to inflict “economic pain” on rival states, even if they have not conducted to the full achievement of their geopolitical goal. Denying economic resources to an adversary or strategic competitor can weaken its economic power, even if the coercion fails to persuade it to change its behavior (CNAS, 2023). The increasing recourse to these tools has led to economic conflicts between states due to divergent interests, geopolitical goals and policies related to economic matters. The growing number of economic confrontations are hindering global cooperation on economic issues and are creating major risks for the maintenance of international peace and security. Strengthening the role of the UN can provide a platform for resolving the conflicts originating in the use of economic coercion between states. The UN intervention in cases of economic coercion can be based on the UN Charter, as the use of this type of force can be seen as a violation of some of its core provisions.

The Illegality of Economic Coercion Under the UN Charter

The Use of Economic Force as a Breach of Article 2-4 of the UN Charter

Economic coercion might be considered as a violation of the prohibition to use force in international relations, established in article 2-4 of the UN Charter. According to article 2-4: “All Members shall refrain in their international relations from the threat or use of force against the territorial integrity or political independence of any state, or in any other manner inconsistent with the Purposes of the United Nations.” It is generally accepted that the term “force” is used in the UN Charter only to prohibit “military force” (Pobjie, 2024, p. 106). However, for some states, a broad interpretation of “force” covering “economic coercion” must be included in the terms of article 2-4. During the San Francisco Conference, the delegation of Brazil proposed to include the threat or use of economic measures under article 2-4 (Batinga, 2024). According to the proposal, this provision was to cover “the threat or use of economic measures in any manner inconsistent” with the United Nations' purposes Doc. 215, I/l/10, 6 U.N.C.I.O. Docs. 527, 559 (1945). The amendment was rejected by a vote of 26 to 2, but the reasons for its disapproval are not clear. The rejection of the Brazilian amendment may have reflected either opposition to the prohibition of use of economic force by article 2-4 or simply the belief of some of the delegates that the Charter already embodied this prohibition (Bucheit, 1974).

In 1965, at the twentieth session of the General Assembly, the Special Committee on Principles of International Law Concerning Friendly Relations and Cooperation Among States submitted a report which contained an extensive but inconclusive discussion of the merits of reading into article 2-4 as a prohibition of the use of economic force, at least when it constitutes a threat to the territorial integrity or political independence of the target state. The committee debate focused on four proposals. Two of these proposals, those submitted by Czechoslovakia and Yugoslavia, explicitly stated that the principle of article 2-4's prohibition of force includes both economic and political pressure. A joint proposal submitted by Ghana, India and Yugoslavia contained the same suggestion, at least by implication. The United Kingdom, on the other hand, sought to limit the meaning of force to armed force and specifically abjured the inclusion of lesser forms of coercion (Bucheit, 1974). After the decolonization process, the Non-Aligned Movement supported discussions on the “economic, political and other forms of pressure or coercion” during the 1967 session of the Special Committee on Principles of International Law concerning Friendly Relations and Co-operation among States (U.N. Doc. A/5746).

The third report of the Special Committee summarized the main arguments in favor of a broad interpretation of the term “force” including economic coercion as follows: “(f) economic and political forms of pressure were sometimes as dangerous as armed force, particularly for developing countries, new States and peoples under colonial domination, and could accomplish the same illicit results; they constituted a violation of international law and a threat to the maintenance of international peace and co-operation; (g) the existence of international relations based on the free consent of independent sovereign States necessarily implied prohibition both of armed force and of other forms of pressure and coercion; (h) the authors of the Charter, in drafting Article 2, paragraph 4, had used the generic term ‘force’ without any qualification, and consequently a broad interpretation of that term was perfectly compatible with the text of that provision; (i) there was nothing in the travaux préparatoires of the San Francisco Conference to preclude a broad interpretation of ‘force’ in Article 2, paragraph 4, of the Charter; (j) the very fact that the San Francisco Conference had rejected a Brazilian amendment that a reference to economic forms of pressure be added was proof that such a reference was not considered necessary in view of the broad meaning of the term ‘force’ in Article 2, paragraph 4, of the Charter... (UN Doc A/6799).”

Perhaps the strongest argument for the inclusion of a prohibition to use economic coercion in the relations between states under article 2-4 is to be found in the wording of the provision itself. As shown by the “travaux préparatoires” of the charter, its drafters were fully aware that states use many methods to coerce once another, which not necessarily imply the use of armed force. The fact that they did not use any objective to describe the word “force” clearly indicates that they did not have the intention to limit its scope, but rather to leave it open-ended and adaptable to the evolution of international relations and the future diversification or sophistication of states’ coercive arsenal. The drafters of the UN Charter were aware of the difficulties surrounding any possible amendment of the provision of the agreement and were not ignorant of the vagueness inherent to the word “force” in article 2-4, especially because in other provisions of the Charter, such as its preamble and its article 41, they used the term “armed force” to show that what they meant by force for reason of the application of these provisions was “armed force”. In fact, the preamble states that “armed force shall not be used, save in the common interest,” and, according to article 41: “The Security Council may decide what measures not involving the use of armed force are to be employed (…) These may include complete or partial interruption of economic relations (UN Doc A/6799).” This clear distinction of economic pressure from armed force can be interpreted as showing that when the drafters of the Charter wished to refer to both coercive methods, they mentioned both.

Not only the wording of article 2-4, but also its teleological interpretation according to the expressed purposes and principles of the UN Charter, supports the establishment of a general prohibition to use economic force in the relations between states. According to the Charter, the UN member states intend “to practice tolerance and live in peace with one another as good neighbors.” By virtue of Article 1-1, the organization’s main objective is “to take effective collective measures for the prevention and removal of threats to the peace, (...) and to bring about by peaceful means... adjustment or settlement of international disputes or situations which might lead to a breach of the peace (...).” In addition, according to article 1-2, the organization’s aim is to develop “friendly relations among nations based on respect for the principle of equal rights and self-determination of peoples (…) (UN Doc A/6799).” Only a more comprehensive reading of article 2-4 could permit the organization to fulfill those purposes. Why would the drafters, after eloquently expressing their desire to promote international peace and security, limit this goal to only one type of threat to this peace- armed force?

The delegates drafting this instrument were undoubtedly aware that armed conflict was frequently preceded by nonmilitary, economic confrontations (Bucheit, 1974), as the topic of economic coercion was a very debated issue during the foundation of the UN legal framework in 1945. In fact, the use of economic coercion in the relations between states was a topic included in the draft of other important treaties of the post-World War II liberal world order. In 1949, the International Law Commission (ILC) began work on a draft treaty to codify the rules of the law of treaties in the new order- the Vienna Convention on the Law of Treaties (VCLT). One of the most contentious issues of its negotiation concerned the definition of “coercion”, as a cause for the invalidity of a treaty. Article 52 of the VCLT permits the invalidation of a treaty “if its conclusion has been procured by the threat or use of force (United Nations, 1969).” Delegations from newly independent states argued for a broader definition of coercion to encompass forms of economic pressure used to impose unequal treaties, such as those concluded during the colonial-era or in the immediate aftermath of the decolonization process. In the opinion of the ex-colonies, if international law preserved the right to impose such treaties, it would serve to preserve the economic domination of former colonies and establish a system of neocolonialism. For example, the delegation from the Philippines argued that the failure to regulate economic coercion would produce a system of international law in which “there would be no protection against measures such as economic strangulation, to which, many countries, and especially the developing countries, are particularly vulnerable (Bali, 2024).” Western states delegations rejected the inclusion of economic coercion in article 52 of the VCLT, arguing that the concept of “unequal treaties” was vague and would undermine the stability of treaty relations. These states claimed that “strangling the economy of a country” could not amount to the type of coercion prohibited by the UN Charter. In the end, after closed-door negotiations, the new independent states reached a compromise with the delegations of developed countries: to withdrawal the proposal of amendment to article 52 of the VCLT in exchange for the adoption of a non-binding draft declaration condemning the use of economic pressures (Bali, 2024). The declaration was adopted as part of the Final Act of the Conference and it condemned coercion in any form, military, economic or political. According to the Declaration: “The United Nations Conference on the Law of Treaties (…) solemnly condemns the threat or use of pressure in any form, whether military, political or economic, by any State in order to coerce another State to perform any act relating to the conclusion of a treaty in violation of the principles of sovereign equality of the States and freedom of consent (…) (United Nations General Assembly, (1969).” These arguments must be reassessed to reinforce the UN’s function in the deterrence of the growing use of economic violence in the relations between states.

References