Promoting the Euro – Countering Secondary Sanctions

US-Chinese rivalry will increasingly play out in the geo-economic realm. The use of secondary sanctions – especially secondary dollar sanctions – negatively affects German economic interests. The new German government should therefore intensify efforts to promote the euro as an international currency coequal to the dollar in addition to lending its qualified support to EU anti-coercion policies. – Washington can unilaterally impose dollar sanctions with relative ease. Such dollar-based sanctions, even though they may target Chinese entities, will harm Germany’s international commercial relations in the guise of so-called secondary sanctions. – In the face of US financial statecraft, Germany’s options are limited. Promoting the international role of the euro by completing monetary union and advancing capital markets union offers the best prospect of deterring and deflecting secondary dollar sanctions.