The word “chokepoint” is becoming increasingly common in discussions about world affairs, in large part most recently largely because of the closure of the Strait of Hormuz, through which a fifth of the world’s oil and gas usually flows. But according to Edward Fishman, the author of an acclaimed book about chokepoints, the strait would only rank fifth on his list of the top five pressure points in global commerce.
Learn about the other four and much more about how countries and companies can navigate our new weaponized interdependence on the latest episode of FP Live. Fishman is also a senior fellow at the Council on Foreign Relations and has served in a range of roles in the U.S. government focused on economic sanctions. Subscribers can watch the full discussion on the video box atop this page or look for it for free on YouTube or Spotify. The audio podcast is available on all major audio platforms. What follows here is a lightly edited and condensed transcript of my conversation with Fishman.
Ravi Agrawal: Let’s start with a simple question. What exactly is a chokepoint?
Edward Fishman: Chokepoints are parts of the global economy where one country or a coalition of close allies has a dominant position, and there are few, if any, substitutes. Throughout history, most of the prominent chokepoints have been geographic, like the Strait of Hormuz, or the Strait of Malacca, or the Bosphorus and the Dardanelles, which connect the Black Sea to the Mediterranean. It’s quite obvious that cutting off another country’s access to these trade routes can inflict significant economic harm on them.
The more novel form of chokepoints, which is a child of the hyperglobalization period of the 1990s, are these economic chokepoints that involve financial systems. The dollar can be used as a chokepoint. Rare-earth minerals and magnets are a Chinese chokepoint. These are parts of the global economy that can be weaponized for geopolitical gain. And they’re also parts of the economy where, if you’re a company that is sitting on one of these chokepoints, it can be incredibly, strategically valuable and lucrative.
RA: If you had to rank the top five global chokepoints today, what would they be?
EF: The most potent and important chokepoint in the global economy is the U.S. dollar. It’s involved in 90 percent of all foreign exchange transactions. It’s effectively impossible to do global business as a multinational bank or company without access to the dollar. The other thing that makes the dollar such a valuable chokepoint is that the United States can cut off other countries from it without the use of military force, just by the stroke of a pen.
I’d say the second-most potent chokepoint—and I’d class a couple of them together here—are chokepoints that exist in the supply chains for advanced semiconductors. The reason being, we’re obviously in a fierce race for supremacy in artificial intelligence. So much of that race depends on access to cutting-edge chips, and in order to make best-in-class chips, you need chip designs from companies like Nvidia; chip-manufacturing equipment from companies like ASML in the Netherlands; and fabs, the actual chip plants in Taiwan. I’d group those as probably the second-most potent.
Third, I would put China’s rare-earth minerals and magnets, which is a really fascinating one because if you just look at the numbers, it doesn’t seem that impressive. In 2024, China’s total export earnings from rare-earth minerals and magnets were $3.5 billion, effectively nothing when you think about it. And yet, the thing that’s remarkable is there are estimates by the International Energy Agency that a significant supply disruption to rare-earth minerals could cost the global economy almost $7 trillion. The U.S. government has said that a cutoff could cost the United States alone more than half a trillion dollars. So, it’s really asymmetry that gives this chokepoint its power.
Fourth is where I would put the Strait of Hormuz. It’s the most important geographic chokepoint but a notch below those other three.
And then fifth—and this is maybe debatable because it hasn’t been weaponized yet but it’s one that Europe increasingly is worried about—is cloud services. U.S. companies like Amazon, Microsoft, Google, and Oracle control about 75 percent of the global market share.
Those are probably the five most potent chokepoints, four of which are economic chokepoints, the newer-style ones that come out of the 1990s, and one of which is this old-school chokepoint, the Strait Hormuz, which is bedeviling us on a daily basis for the last six months or so.
RA: Let’s talk about the dollar, which topped your list. You have this great statistic in the book, where you write that every U.S. president this century has imposed twice as many sanctions as their predecessor. Is the United States overusing this chokepoint?
EF: Yes, and what that tells you is that there’s got to be a structural underpinning to this. I’m someone who studied history. I tend to view world affairs through individuals and their role in making decisions, because I do think people and decisions matter. At the same time, it can’t be the case that Barack Obama and Donald Trump disagree on everything except for the fact that economic warfare is great. There has to be a structural underpinning, and the way that I would summarize it is that the world economy we have today was built for the benign geopolitical environment of the 1990s, but we’re living in a period of increasing geopolitical tension. That mismatch between a global economy that just doesn’t make sense in today’s geopolitical reality is what’s leading to the proliferation of sanctions, tariffs, and export controls—these offensive measures of economic warfare—as well as the defensive measures, like industrial policy, which countries are using to try to insulate themselves from other countries’ chokepoints.
RA: Just to expand on that a little bit, when you say that the economic system as we know it isn’t fit to deal with these new realities that you’re describing, what should we do about it? How do you change that?
EF: Inevitably, you’re going to have less economic interdependence. That’s the most obvious takeaway: The types of dependencies the United States has on China for active pharmaceutical ingredients, for instance, doesn’t seem all that rational in a world where it’s very possible that the United States and China could have an escalating economic war. In fact, we had one last year that led to the closure of certain factories in the Midwest, because they couldn’t produce automobiles, which led to Raytheon having to scour the globe for alternative supplies of rare earths to use in its Tomahawk cruise missiles. So, I do think we are necessarily going to have to have less economic integration.
The call to action that I’m trying to put out there is if we do this in an “every nation for itself” scramble, in which every country makes their own individual decisions about sanctions, export controls, tariffs, and industrial policy, you are going to have a suboptimal outcome. You’re going to have a system where countries are sleepwalking into a form of quasi-autarky, where they try to do everything themselves. What I prefer is for the United States and its allies to put forward a new vision for a global economic system involving even deeper integration between the United States and allied countries like Canada, Europe, and Japan, with progressively less integration with geopolitical rivals like Russia and China, and less dependence on chokepoints that adversaries can control, like the Strait of Hormuz.
In order to do that, the United States is going to have to restrain itself. It can’t build that type of new global economic order while simultaneously hitting its allies with tariffs. That’s not possible. We can’t have our cake and eat it, unfortunately, in this way.
RA: Let’s talk more directly about China. The AI supply chain was number two on your list. Last year, when Beijing limited rare-earth exports—weaponizing its chokepoint—it really transformed the U.S.-China relationship, right? And does that then mean you can’t keep using chokepoints indefinitely in this way?
EF: I completely endorse the way you characterized that. The single biggest geoeconomic story of 2025 was not Trump’s “Liberation Day” tariffs; it was actually the Chinese export controls on rare-earth minerals and magnets. The mentality of the Trump administration—and by the way, you don’t need to read their minds for this, you just look at their public statements at the beginning of 2025—was that they could always win any trade war with China, because we import so much more from China than China imports from us, so we could always impose more tariffs on China than China can impose on us.
In fact, in the wake of “Liberation Day,” U.S. Treasury Secretary Scott Bessent said publicly, “I think it was a big mistake, this Chinese escalation, because they’re playing with a pair of twos.” That revealed that they thought that this was just a trade war, where we were going to do tariffs, China was going to do tariffs. China showed us that they also have chokepoints they can weaponize, the same way the United States can use the dollar as a cudgel. And when China retaliated asymmetrically on April 4—two days after “Liberation Day”—and then within weeks, Ford idled its factory for the Explorer SUV, and it sent shockwaves across Washington. It’s been reported now that members of the Trump administration have started adopting Deng Xiaoping’s dictum, “hide your strength, bide your time,” to characterize U.S. strategy now, because the idea is that we have to have some level of detente with China until we can break its chokehold over rare earths.
China demonstrated to the world in 2025 that instead of just capitulating under American economic pressure, you can strike back using your own chokepoint and potentially leverage the fact that the United States may have less pain tolerance than an authoritarian country like China. I do believe that Iran took lessons from that in their wartime strategy over the last several months, because they saw what China was able to do: weaponize a chokepoint against the United States and get the United States to make substantial concessions both on tariffs and on our own export controls. Iran realized they could do the same thing, and they’ve succeeded beyond their own imagination.
It wouldn’t surprise me now if other countries are thinking the same things, including our allies—the Europeans, the Japanese. Last year, when hit with big tariffs, they made quick deals with the United States. They said it’s better to make a lopsided deal than have a trade war. I’m not so sure it would play out the same way this time if there was another escalation between the United States and Europe. We had a preview of what that might look like in January, when Trump was pressuring Europe over Greenland; the Europeans were getting ready to use their anti-coercion instrument. So, in some ways, the Chinese and Iranians may be setting a precedent for other countries to follow.
RA: Much of this conversation has been centered around how countries should think about chokepoints and trying to safeguard their supply chains but also form alliances. What about companies? Where do companies fit into this? If you are a CEO of a medium-sized company or a large multinational, and you’re listening to this conversation and learning about chokepoints being weaponized everywhere, how do you deal with it? What are the safeguards you need to put in place?
EF: One thing that makes economic statecraft such a complicated tool of foreign policy is that governments set the policy. It’s Xi who decides who has access to Chinese rare earths and who doesn’t. But it’s actually companies that do the implementation. It’s not like there’s a button in the Treasury Department that the treasury secretary can click to freeze somebody’s assets. They put the name of a Russian bank on a list, and then it’s up to J.P. Morgan Chase and Standard Charter to freeze the assets of that Russian bank. It’s businesses that are actually implementing this. In many ways, businesses have just as central a role to play as governments do. Businesses can even change government policy. One of the more prominent chokepoints I mentioned in the chip supply chain are video chip designs. Nvidia has successfully gotten the Trump administration to reduce some export controls on China. So, companies have an independent role to play.
If I’m a CEO or a board of a company right now, how does this factor into my strategy? First, I want to know: What are the chokepoints in my industry and my ecosystem that make me vulnerable to a potential shock, and what are ones that might be opportunities for me? If it’s actually the case that Europe is worried about American economic warfare and wants to indigenize their cloud and their AI, for instance, that’s going to provide huge opportunities for European businesses to serve those functions. So, it’s both a risk in terms of mapping the chokepoints that make you vulnerable and then potentially opportunities—understanding which chokepoints you might be able to fill in an economic security strategy for whatever country you’re based in.