China expands dual-use export restrictions on Japanese firms

China has broadened its export controls on dual‑use goods, adding 20 Japanese defence research institutes and subsidiaries of large conglomerates such as Mitsubishi Electric, Mitsubishi Heavy Industries, Mitsui E&S and Terra Drone to its blacklist. A further 20 Japanese companies, including Subaru, TDK and Fuji Aerospace, were placed on a heightened‑surveillance list that requires stricter licensing for any export of Chinese technology.

Beijing said the measures target Japan’s “new type of militarisation” and its alleged push to develop offensive weapons, linking the sanctions to recent statements by Prime Minister Fumio Kishida on Taiwan. Japan’s government has lodged a strong diplomatic protest, with Minister Minoru Kiira calling the action “absolutely unacceptable and extremely regrettable” and demanding its immediate withdrawal.

The escalation follows earlier rounds of restrictions imposed since January. While the measures are intended to limit Japan’s access to Chinese dual‑use items, they have already influenced market reactions, with Mitsubishi Electric shares slipping about 1% and Mitsubishi Heavy Industries rising 4.9% after the announcement.