Japan protests China's tightened dual-use export controls

Japan has called on China to reverse its decision to impose stricter export rules on products with potential military applications, a move that has raised fears of supply disruptions.

China’s commerce ministry announced on Tuesday that it would immediately strengthen export controls on dual-use goods bound for Japan. Although no specific products were listed, the statement has sparked concern that rare earth minerals may be targeted.

The decision follows rising diplomatic tension after Japanese Prime Minister Sanae Takaichi suggested in November that Japan could respond militarily if Taiwan were attacked. China views Taiwan as part of its territory and has not ruled out the use of force to take it.

China is the world’s dominant supplier of rare earths, which are essential for technologies ranging from smartphones and electric vehicles to military hardware. Analysts warn that restricting shipments could severely impact Japanese industries.

Japan’s foreign ministry said Masaaki Kanai, secretary general of Asian and Oceanian Affairs, issued a strong protest to Shi Yong, the deputy chief of mission at China’s embassy. Kanai said the action deviates from international norms and is unacceptable.

Risk consultancy Teneo suggested the vague language in Beijing’s announcement may be intended as pressure on Tokyo, warning that the impact could span from symbolic measures to major supply-chain disruption. The firm said China may initially reject only a small number of export licence applications to signal the potential for broader restrictions.

Nomura Research Institute economist Takahide Kiuchi warned that Japan could face severe economic repercussions if rare earths are included, estimating losses of 660 billion yen and a reduction of 0.11 percent of GDP from a three-month halt.