China Threatens Japan with New Economic Sanctions

The Chinese Ministry of Commerce warned today, Thursday, that it would take "necessary measures firmly" against Japan if Prime Minister Sanae Takaichi does not retract her recent statements about Taiwan, indicating that trade cooperation between the two countries has been "severely damaged."

Reason for the Threat and Potential Ramifications

• Provocative Statements: The escalation came after Takaichi told parliament on November 7 that any presumed Chinese attack on Taiwan could lead to a military response from Tokyo.

• Chinese Warning: Ministry spokesperson He Yongqian said: "Prime Minister Takaichi's wrong statements regarding Taiwan have fundamentally undermined the political foundation of China-Japan relations and severely damaged bilateral economic and trade exchanges." She warned that Japan "will bear all consequences" if it insists on this path.

• Economic Reliance: China is Japan's second-largest export market, buying nearly $125 billion worth of Japanese goods in 2024 (industrial equipment, semiconductors, and cars).

• Difficulty Finding Alternatives: Data indicates that Tokyo may face significant difficulty finding alternative markets if Beijing imposes sanctions, as Japan's exports to its third-largest destination (South Korea) did not exceed $46 billion last year.

Precedents of Trade Sanctions

China has a history of taking coercive trade measures against its neighbor:

• Seafood: In 2023, Beijing imposed a comprehensive ban on all Japanese seafood imports after Tokyo decided to discharge treated radioactive water from the Fukushima nuclear plant into the Pacific Ocean.

• Rare Earth Metals: In 2010, China halted exports of rare earth metals to Japan for seven weeks following a diplomatic dispute over the contested Senkaku/Diaoyu Islands.