International-relations theorists generally distinguish between soft and hard power. Soft power refers to the exercise of political influence through flexible, non-binding instruments such as economic assistance; the dissemination of environmental, health, and civil-security standards; and exports of cultural goods. Soft-power leaders are generally reluctant to coerce others and prefer to wield influence by example. The European Union is the leading exponent of this approach.
Hard power, by contrast, refers to military and economic instruments of coercion. Rather than leading by example, countries that depend on the hard power at their disposal wield it to try to bend others to their will. Following Machiavelli, they would rather be feared than loved. Here, Russia is a quintessential example. And between Europe and Russia, the United States has long represented a unique combination of both forms of power.
But nowadays, the distinction between hard and soft is becoming less relevant, because soft power itself is being weaponized. In what some commentators now refer to as ‘sharp power’, traditional soft-power tools, such as trade, legal standards and technology, are increasingly being used to coerce. If one were to identify three primary causes for this change, it would be the rise of China, the ensuing Sino-American rivalry, and the new powers of digital technology.
So far, the most sensitive domain in which soft power has been weaponized is trade. Since President Donald Trump came to power, the US has ratcheted up import tariffs and invoked ‘national security’ to justify its circumvention of the rules-based multilateral trading system. Although the US can no longer control the multilateral system singlehandedly, it still can harm its competitors (and its allies) on a bilateral basis.
The consequences of this weaponization of trade have been profound. By the end of 2019, the US will have an average import tariff rate of 6.5 percent, up from just 1.5 percent three years ago, putting it close to Brazil in terms of import barriers. The Trump administration has now imposed levies on 90 percent of imports from China, yet its strategic objectives for the trade war remain unclear.
To be sure, the Trump administration wants to force China to reduce its bilateral trade surplus with the US, and many in the US want China to move toward a market economy. But the irony is that the trade war has forced both countries to embrace managed trade, which gives the Chinese state an even firmer grip on the economy.
A new era of managed trade implies significant risks for Europe. China may have to import less from Europe in order to import more from the US, or it may dump onto European markets exports that it can no longer ship to the US. Either way, international trade is increasingly becoming a zero-sum game.
The weaponization of soft power is also gaining ground in the legal domain, through the extraterritorial application of national laws. Both the US and the European Union rely on extraterritoriality, but the differences in how each wields this power is revealing. European extraterritoriality has never been used for strictly political purposes and is essentially limited to three areas: market standards, competition policy, and the protection of personal data.
The US, however, regularly uses the dollar to sanction any economic activity that it regards as a threat to its foreign-policy interests, even in the short term. The French bank BNP Paribas, for example, has been fined $9 billion by the US Department of Justice for violating US embargoes against Cuba, Sudan, and Iran. And under the 2018 Clarifying Lawful Overseas Use of Data (CLOUD) Act, US law-enforcement authorities can now access data held by American companies even when it is not stored in the US.
Once again, European companies have borne the costs of these measures. And because European firms are so heavily integrated with the US economy, Europe has struggled to maintain an autonomous foreign policy toward Iran. Unless the euro can be made into an international currency to rival the dollar, the European economy will remain highly vulnerable to US extraterritoriality.
A third area of soft-power weaponization has been technology, particularly with respect to 5G. Unlike 3G and 4G broadband systems, 5G deployment has far-reaching security and geopolitical implications, because it promises not only to improve mobile telephony, but also to accelerate the development of the Internet of Things and the digitalization of entire economies. Thus, any malicious intervention in the 5G architecture could cause considerable economic, social, or even physical damage.
Owing to China’s growing capacity to conduct cyber warfare, the head of the German intelligence service has expressed deep reservations about opening the German 5G network to the Chinese company Huawei. Although it is currently the world’s leading provider of 5G hardware, Huawei is subject to Chinese law, and thus ultimately answerable to the Communist Party of China and Chinese intelligence and security services.
Whatever one thinks of the Trump administration, the US is not wrong to highlight the potential danger posed by Huawei and Chinese technology providers generally. US allegations against Chinese companies such as Huawei and ZTE should open Europeans’ eyes to the threat of weaponized network technologies.
Looking ahead, it would not be unreasonable for the US to offer its support to European companies such as Ericsson or Nokia, which serve as counterweights to Huawei in Europe and elsewhere. For its part, the EU’s strict competition rules prevent it from extending overt assistance to these companies on its territory. And because the EU is not a state, it has no interest in providing state aid or otherwise playing the card of soft-power weaponization.
Yet European leaders should be careful not to ignore realities on the ground. Missing the opportunity to get ahead of a worrying new global dynamic would not be in the interest of the world’s last major soft-power actor.
Zaki Laïdi
Professor of International Relations at Sciences Po.
