Can coercive economic statecraft assist a rising power to advance geopolitical aims? This project examines how, over decades, China’s strategic thinking evolves to include the use of coercive economic instruments against foreign states, when it obtains political concessions from target states, and with what implications for its rivalry with the United States. I argue that an ex-ante adversarial threat posture for economic linkages with China significantly reduces the target’s incentives for making tactical compromise. Such a threat posture refers to the strategic perception and actions that a country takes in identifying, assessing, and mitigating risks and uncertainty associated with its economic relations with another country. Using a first-of-its-kind comprehensive examination of Chinese academic discussions about sanctions from 2001 to 2022, this dissertation provides new insights into the continuity and change in the Chinese understanding of economic coercion. To examine the effectiveness of China’s coercive statecraft, I draw on an original dataset of economic coercion involving China as initiator since 2001 and use a research design that leverages interviews and comparative case studies. I investigate two episodes based on a comparative “most-similar systems” design: the 2016-17 trade coercion against South Korea and the 2020-2023 trade sanctions on Australia. My research reveals a dilemma at the heart of sanction effectiveness faced by a rising power. As China seeks to lock in its perceived advantages as a global power by coercive means, heightened threat perception in other states undermines its capacity to coerce, deter, and compel.