By Joe Cash
BEIJING, Jan 8 (Reuters) – China’s ban on dual-use goods exports to Japan will only affect military firms, the Commerce Ministry said on Thursday, helping to calm fears that Beijing could curb shipments of rare earths vital to Japan’s auto industry because of Tokyo’s remarks about Taiwan.
Dual-use items are goods, software or technologies that have both civilian and military applications. These 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 spokesman for the commerce ministry, 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 state media reports that the Commerce Ministry was weighing whether to further tighten rare earth export licenses to Japan.
China has an export control list of about 1,100 dual-use items and technology that manufacturers need a license for to ship abroad, wherever the end user is. That list contains at least seven categories of medium and heavy rare earths. However, it did not specify which goods could be affected by the ban on exports to Japan.
RELATIONS DETERIORATE OVER TAIWAN’S REMARKS
Ties between Beijing and Tokyo have worsened since Japanese Prime Minister Sanae Takaichi said in November that a Chinese attack on Taiwan that threatened Japan’s survival could lead to a military response, a remark Beijing said was “provocative”.
“Exports to Japan for military purposes, which may find a military application, and all other end uses that contribute to the improvement of Japan’s military capabilities are prohibited,” He said.
“The objective of stopping Japan’s remilitarization and nuclear ambitions is completely legitimate, justified and legal,” he added.
Japan’s Vice Foreign Minister Takehiro Funakoshi on Thursday strongly protested the ban to Wu Jianghao, China’s ambassador to Japan, and asked China to withdraw the measures, the ministry said in a statement.
Wu denied the representations, the Chinese embassy said in its statement.
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).
(Reporting by Joe Cash; Editing by Edwina Gibbs and Louise Heavens)