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China aims to squeeze Japan’s economy with rare earth curbs

Jan 11, 2026, 5:22pm EST
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Sanae Takaichi
Kiyoshi Ota/Pool via Reuters

Tensions between China and Japan are deepening as a diplomatic row over Taiwan morphs into an urgent economic conflict.

Tokyo is reaching out to G7 peers to discuss critical minerals and strengthen its position after Beijing enacted new export restrictions that could affect rare earths, including products with non-military uses, Nikkei reported.

China’s playbook — weaponizing its supply chain dominance — is similar to the one it deployed against the US during last year’s trade war.

Japanese Prime Minister Sanae Takaichi is now reportedly considering calling a snap election to bolster her legislative majority; her hardline stance on China appeals to right-wing voters, and a stronger domestic standing could embolden her foreign policy stance, analysts said.

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