On Thursday, China’s commerce ministry stated that its export ban on dual-use goods to Japan would target only military companies, easing concerns that Beijing might restrict rare-earth supplies crucial to Japan’s automotive sector in response to Tokyo’s comments on Taiwan.
Dual-use items are goods, software or technologies that have both civilian and military applications. They include certain rare earth magnets that power motors in car parts such as side mirrors, speakers and oil pumps. They play an even bigger role in EVs.
“Civilian users will not be affected,” He Yadong, a commerce ministry spokesperson, told reporters. “China has always been committed to the stability and security of global production and supply chains,” he added.
He did not say whether rare earth elements were covered by the restrictions, and did not comment when asked about reports by state media that the commerce ministry was weighing whether to further tighten rare‑earth export licences to Japan.
Rare Earths and Export Controls
China has an export control list of around 1,100 dual-use items and technologies that manufacturers require a licence for to ship overseas, wherever the end user may be. That list contains at least seven categories of medium and heavy rare earths. It has, however, not specified which items may be affected by the ban on exports to Japan.
Rising Tensions
Ties between Beijing and Tokyo have deteriorated since Japanese Prime Minister Sanae Takaichi said in November that a Chinese attack on Taiwan threatening Japan’s survival could trigger a military response, a remark that Beijing said was “provocative”.
“Exports to Japan for military purposes, that could find a military application, and all other end-uses contributing to the enhancement of Japan’s military capabilities are prohibited,” He said.
“The objective of halting Japan’s re-militarisation and nuclear ambitions is entirely legitimate, justified and lawful,” he added.
Japan’s foreign ministry on Tuesday, the day Beijing announced the ban, said it strongly protested the measures and demanded that China withdraw them.
Last month, Japan’s cabinet approved a record spending package for the fiscal year starting in April that includes a 3.8% increase in the country’s annual military budget to 9 trillion yen ($58 billion).
(With inputs from Reuters)
