The Chokepoints Nobody Is Watching
The global economy runs on hidden architecture. Some of it is ours. Some of it is aimed at us. Most executives have mapped neither.
TL;DR The global economy runs on two categories of chokepoints. The first is controlled by the US and Western institutions: dollar clearing, SWIFT, Euroclear, the Foreign Direct Product Rule, the Big Four, Visa and Mastercard, MSCI, and hyperscaler cloud infrastructure. All were activated simultaneously against Russia in 2022. The second is controlled by adversaries: China’s rare earth processing forced a US policy reversal in 2025, and Iran’s Hormuz closure may force another now. Most organizations have not mapped their exposure across both and are operating blind.
The Chokepoints Nobody Is Watching
The Visible Map
The world is finally paying attention to chokepoints, but it is paying attention to a small subset. Iran has closed the Strait of Hormuz, a corridor carrying roughly 20 percent of global oil and gas, and financial markets are responding with the predictable anxiety of people encountering a problem they were warned about for decades. TSMC controls 72 percent of global semiconductor foundry capacity, and a Taiwan blockade would reduce global GDP by an estimated 10 percent according to Bloomberg analysis. China controls 85 to 90 percent of global rare earth processing. These are genuine chokepoints. They are also, at this point, the chokepoints that everyone already knows about. They appear not only in think tank reports, earnings calls, and Treasury Secretary speeches at Davos but also in layman YouTube analysis and Scott Galloway’s newsletter.
A true chokepoint meets three criteria: dominant market share, no viable substitution in any timeframe that matters, and the capacity for asymmetric deployment against a specific target without equivalent blowback on the user. The Strait of Hormuz, TSMC, and Chinese rare earth processing meet all three criteria. But the conversation about those three has been happening for years. What has gone unnoticed are the dozens of chokepoints that meet the same three criteria and have already been activated, at scale, with documented consequences, that almost no corporate strategy team, boardroom or risk committee has formally mapped.
There are two categories of chokepoints that executives need to understand, and they require different responses. The first category is controlled by the United States and Western-aligned institutions. These are the most powerful economic weapons ever assembled, they have already been used, and any company or country in the crosshairs of Western policy is exposed to them. The second category is controlled by adversaries and is increasingly aimed back at the West. China’s rare earth licensing system forced a US policy reversal in 2025. Iran’s Hormuz closure may force another now. The arms race between these two categories is accelerating, and the multinational executives best positioned to survive it are the ones who have mapped both sides of the ledger.
The Architecture the West Controls
The most powerful chokepoints in the global economy are financial, regulatory, and institutional, and they are concentrated in Western jurisdictions to a degree that has no historical precedent.
The US dollar is involved in roughly 90 percent of all global foreign exchange transactions, making it the supreme chokepoint in the entire architecture. Any company or country that needs to conduct international business requires access to dollar clearing. The Federal Reserve, US-chartered correspondent banks, and the Treasury Department’s Office of Foreign Assets Control collectively determine who has that access. When OFAC designates an institution as a Specially Designated National, any US-connected counterparty must cease all dealings immediately, regardless of where they are incorporated or where the transaction occurs. Dollar correspondent banking de-risking, driven by the deterrent effect of large enforcement actions, has quietly severed entire regions from international finance without any single government order: 21 of 23 Caribbean banks have lost at least one correspondent relationship, and Pacific Island nations have lost 60 percent of their correspondent relationships since 2011.
SWIFT, a Belgian cooperative subject to EU law, has already been used twice to sever economies from cross-border payment infrastructure, and it will be used again. Following EU Regulation 267/2012, SWIFT disconnected approximately 30 Iranian financial institutions. Iranian crude exports fell from 2.5 million barrels per day to 860,000 barrels within months, and net oil export revenues dropped by an estimated $26 billion in a single year. Russia’s disconnection in March 2022 followed the same mechanism. Simultaneously, Euroclear, the Belgian financial services company, froze approximately 180 to 185 billion euros in Russian central bank assets in a single regulatory action. The Russian central bank is pursuing legal recovery of approximately 230 billion euros in a Moscow court. Those proceedings are unlikely to succeed.
The US Foreign Direct Product Rule is perhaps the most underappreciated chokepoint in the entire Western arsenal, because it operates extraterritorially and requires no cooperation from any foreign government. The rule holds that any product manufactured anywhere in the world using US-origin technology, software, or equipment falls within US export jurisdiction. When the Commerce Department expanded the rule in May 2020 to cover products manufactured for Huawei, TSMC stopped accepting new orders the same day. Final shipments cleared in September 2020. Huawei’s global smartphone market share collapsed from approximately 20 percent to near zero within two years. One regulatory instrument applied to a Taiwanese company operating in Taiwan restructured the global smartphone market.
The business services layer is the chokepoint category almost entirely absent from existing analysis, and it is where the Russia stress test produced its most instructive results. On March 5, 2022, Visa and Mastercard suspended operations in Russia without a government order, citing their network rules. Cards issued by Russian banks stopped working internationally within days. All four dominant audit firms withdrew simultaneously, making it practically impossible for Russian companies to maintain international listings or access capital markets, because no alternative audit infrastructure exists at comparable scale or international recognition. Bloomberg Terminal access was suspended, removing pricing data, analytics, and execution connectivity in a single action. MSCI and FTSE Russell removed Russian securities from their indexes, pricing them at effectively zero, triggering automatic forced selling by every passive fund tracking those benchmarks. None of these actors coordinated with the others. Each acted within its own rules. The cumulative effect was indistinguishable from a state-directed infrastructure cutoff, because the infrastructure was genuinely concentrated in jurisdictions aligned with the sanctioning coalition.
The software infrastructure layer extends the same logic into the operating systems of modern business. GitHub, owned by Microsoft and subject to US export control law, restricts access in Iran, North Korea, Cuba, Syria, and Russian-occupied territories, cutting developers in those jurisdictions off from the platform on which 90 percent of Fortune 100 companies run their development workflows and where 180 million developers collaborate globally. Microsoft suspended new sales and services in Russia in 2022, creating immediate uncertainty for enterprise customers whose operations ran on Azure and Office 365. Three American companies, AWS, Azure, and Google Cloud, control approximately 63 to 68 percent of the global cloud infrastructure market. A Managing Director at TIAA recently questioned the long-term sustainability of hyperscaler dependency. The CFO at The Hartford described cloud vendor concentration as the point where exposure becomes uncomfortable. These executives recognize that their operational infrastructure runs on someone else’s platform, subject to someone else’s jurisdictional obligations.
The Architecture Aimed Back
Adversaries of the U.S. have spent the past decade studying Western chokepoint strategy and building their own, and the results are now reshaping global policy in real time.
China’s control of rare earth processing is the most consequential adversary chokepoint currently active, and its April 2025 activation produced the most significant geoeconomic event of that year. When Beijing introduced a licensing system for rare earth exports following the Trump administration’s tariff escalation, the effect was immediate enough to alter US policy within months. Automakers sourcing rare earth magnets outside China began paying premiums of 10 to 30 dollars per kilogram above Chinese domestic rates. Dysprosium and terbium reached 3.5 times their Chinese equivalents in non-Chinese markets. Yttrium spiked to 25 times the equivalent price at one point, with one analyst documenting a 69-times year-over-year increase. The CEO of MP Materials told investors in November 2025 that a one-year postponement of expanded controls had done nothing to change the underlying dependency. The U.S. military’s F-35 program is projected to incur $850 million in additional costs in 2025 alone as a direct result of raw material price dislocations. China had been developing this regulatory architecture for years before deploying it. It was not improvised.
Iran’s closure of the Strait of Hormuz is demonstrating, for the second time in recent history, that a country representing less than one percent of global output can hold the global energy market hostage using a geographic chokepoint that the world had decades to address and chose not to. Analysts at Evercore ISI projected earlier this week that the closure will cost the US economy roughly half a percentage point of GDP growth this year. The Trump administration, which entered the conflict expecting rapid capitulation, is now, according to geostrategic analyst Edward Fishman, facing a situation in which reopening the strait has become its single overriding objective, a position that may require ‘boots on the ground’ to resolve. Russia has emerged as the conflict’s largest economic beneficiary, with loosened sanctions generating an estimated $150 to $200 million per day in additional oil revenues, an outcome no one in Washington appears to have planned for.
The arms race is now explicitly bilateral, and the next front is already visible. European officials began searching for leverage points against the United States following Donald Trump’s takeover signals toward Greenland in January 2026. American cloud services, where US firms control roughly three-quarters of the global market, have been identified as a candidate. China’s expanding grip on clean energy supply chains and its processing dominance across critical minerals beyond rare earths represent additional adversary chokepoints under development. The pattern Fishman identified in his February 2025 book Chokepoints is playing out on schedule: the same integration that generated decades of prosperity is now generating the leverage that adversaries are using to fight back.
Adil Husain is the Founder of The Intelligence Council and Managing Director of Emerging Strategy. He advises C-level, strategy, and intelligence leaders on how systems, competitive dynamics, and institutional constraints translate into real enterprise decisions.
📢 Contact me to speak at your company or institution.
Excellent. Very insightful. Learned much that I didn’t know. Thanks.