US sanctions are losing their power in a post-American world

South China Morning Post

17-05-2025

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Donald Trump's return to the White House in January reignited discussions on the use of economic pressure as a tool of US foreign policy. But the world today is not the unipolar terrain of 2018. From Beijing and Moscow to Tehran and Brasília, the contours of global power have shifted.
At the heart of this shift is a growing rejection of US dollar hegemony – and with it, the perceived moral and strategic legitimacy of Western sanctions ('US sanctions network of companies it says helped ship Iranian oil to China',
May 14 ).
This is not to suggest the collapse of American influence, but rather its strategic overextension. In the name of defending the rules-based order, Washington sanctions over a third of the world's countries. But as major powers pivot towards alternative trade settlements and local currencies, the threat of sanctions begins to lose its sting.
Consider the China-Russia partnership: bilateral trade rose to
US$245 billion in 2024 , with over 70 per cent
settled in yuan or roubles . This is not simply economic pragmatism; it's geopolitical signalling. When such arrangements multiply, the architecture of coercive diplomacy faces erosion.
Iran, too, reads the moment carefully. Though
talks with Washington continue, Tehran sees these less as openings for detente and more as shields against hostile escalation. In the view of Iranian policymakers, America's grip is loosening – not only due to its military missteps, but because its financial weaponry is being dulled by the emergence of multipolar alternatives.