The Chinese Ministry of Commerce has just announced new restrictions on exporting dual-use items to Japan. This announcement has caused great panic among Japanese industries. A dual-use item, according to the UN Development Program, is a product or technology that serves both civilian and military functions. Their importance crosses industry lines. Now tensions across the region are mounting further. This change created panic over Japan’s secure supply of critical materials, particularly rare earth elements.
With new export controls set to come into effect in the next few weeks, their timing could hardly be better. These controls are intended to limit Japan’s ability to obtain goods and tech that can be used for military applications. The details of these restrictions are still not known, causing jitters among Japanese officials and industry stakeholders. They fear what this will mean for our national security. They’re worried, too, about losing access to crucial supply chains – industries that rely on these vital materials.
Japan’s government has made no secret of its outrage behind the perceived opacity of the restrictions. Officials are seeking clarification from their Chinese counterparts to understand the full extent of the controls and how they will impact industries that depend on dual-use items. The situation has led to heightened tensions between the two nations, as Japan navigates its economic relationship with China while safeguarding its security interests.
Beyond the pressing dual-use export issue, worries are increasingly mounting about Japan’s access to rare earth elements. These materials are fundamental in the making of many technologies. They are absolutely vital to all electronics, renewable energy systems, and defense applications. China has an overwhelming monopoly on the global market for rare earths as it stands today. Any interruption in supply would have a crushing blow on Japan’s technology and manufacturing sectors.
Inside Japan, industry analysts are stressing the imperative of diversifying supply chains. This strategy will address high-profile risks related to China’s increasing restrictions. You can read about developing alternative sources for rare earths and other dual-use items from foreign adversaries. The other alternative is to build domestic production capacity. Such transitions can be slow and might result in temporary hardship for the workers or regions being displaced.