The U.S. and China: Policy Approaches to Sanctions and Counter Sanctions

Since the establishment of the People’s Republic of China (PRC) in 1949, the United States has been actively using unilateral economic measures (sanctions) against China. After the start of the normalization of political relations between the two nations in the 1970s, the number of restrictive measures decreased, covering only narrow areas of trade by the early 2000s. However, during the first term of Donald Trump’s presidency, sanctions were reintroduced into the U.S. policy arsenal towards China. Though this issue has been widely examined in academic literature, several gaps still remain in current research. China has proven to be too specific case for studies employing quantitative data on sanctions against numerous countries, and gaps continue to remain even in sources that solely analyze the Chinese case. Existing research also tends to focus only on the current political situation, while few studies explore the issue in its historical depth. By examining U.S. sanctions against the PRC, ways in which China has adapted to these sanctions, reciprocal measures taken by China, as well as the reasons for the slow escalation and de-escalation of sanctions, both at the present stage and in historical hindsight, the following research aims to fill in the remaining gaps in understanding U.S. - China sanctions. The Chinese case deviates from the established theoretical premise in existing literature that a change in the political course of the target country is a fundamental criterion for assessing the effectiveness of sanctions. However, sanctions have proven to be effective even if the above-mentioned objective is not achieved. Signaling and deterrence make up for the shortcomings in forcing a target country to change its foreign or domestic policies. The use of sanctions as a signaling tool may help explain why U.S. approaches to sanction de-escalation and escalation are cautious in nature. Drastic measures may prove to be redundant for sending political signals, while moderate actions are more suitable in this regard. The imposition of U.S. sanctions as a tool to deter China’s advancement in the high-tech sector has contributed to an increase in Beijing’s efforts to develop its own restrictive measures. The methodology utilized for this research includes an analysis of documents reflecting the U.S. sanctions policy against China and the recent countermeasures developed by the PRC.