You don’t think China cutting off American ally Japan’s vital rare-earths has anything to do with Trump cutting off Venezuelan oil bound for China, do you? From Tyler Durden at zerohedge.com:
Going all the back to November 7, when Japanese Prime Minister Sanae Takaichi first provoked outrage in China by suggesting that Japanese Defense Forces could militarily defend Taiwan in the event of a Chinese invasion, there’s been a steady spiraling in relations between Tokyo and Beijing. First, China’s punitive measures took place merely on the tourism, culture, and diplomatic fronts – also with some limited economic measures such as halting its exports of seafood from Japan.
New action was also unveiled at not more than a weekly pace, or even monthly – but now after it’s been several months with no retraction and formal apology by Takaichi (demanded by Beijing), the screws are tightening on a daily basis. After this week barring Japan from dual use items (anything with military-civilian application), China has begun depriving Japan of rare earth minerals and rare earth magnets – which could have immediate impact on Japanese companies involved in components for global chip makers, and also hitting the defense and auto sectors. It will be felt by Japanese companies involved in advanced electronics, aviation components, drones and nuclear-related tech.
This sends a resoundingly clear signal to the US as well, after Beijing already moved to cut off rare-earth exports to American companies last year – and Trump blinked first by backing off his trade war with China, and now Beijing is ready and willing to apply the same leverage to close US regional ally Japan.
