China Sanctions 40 Japanese Firms Over Remilitarization
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- China's Ministry of Commerce placed 20 Japanese entities on its Entity List and 20 on a watch list on Monday, accusing them of advancing Japan's 're-militarization' — bringing the total to 80 Japanese firms sanctioned across February and June rounds.
- China's commerce ministry said the Entity List targets firms 'directly involved in boosting Japan's military strength,' while watch-list firms failed to verify end users or end uses for dual-use items; foreign ministry's Guo Jiakun said the measures 'will not affect normal business exchanges.'
- Japan's Type 25 missile deployment in late March put long-range strike weapons with 1,000+ km range into service, including a surface-to-ship variant in Kyushu and a hypersonic gliding variant at Fuji, with future versions planned at 2,000–3,000 km range.
- Japan's Maritime Self-Defense Force underwent its largest overhaul since founding: surface fleet units merged into a new Fleet Surface Force, an amphibious warfare unit was established in Sasebo, and the Air Self-Defense Force began building a dedicated space operations unit.
- Prime Minister Sanae Takaichi told G7 leaders on June 16 that China's export controls against Japan risked disrupting partner nations' supply chains and called on G7 nations and multilateral development banks to build more resilient mineral supply chains.
- A NetEase report said four Japanese photoresist makers — Tokyo Ohka Kogyo, JSR, Shin-Etsu Chemical, and Fujifilm — stopped accepting new orders for advanced ArF and EUV grades; neither the Japanese government nor the companies have confirmed a coordinated halt.
- China's photoresist imports from Japan fell roughly 95% to 111.3 tons in Q1 2026 from 2,200 tons a year earlier, with high-end photoresist imports recorded at zero in Q2 — though Chinese commentators are split, with some calling the ban report 'fake news' and others warning domestic substitution will take 3–5 years.
Why it matters: The 40-firm action is explicitly framed by Beijing as dual-use and 'precisely targeted,' yet Chinese customs data shows a 95% collapse in photoresist imports from Japan in Q1 2026 with zero high-end volumes in Q2 — putting real pressure on China's advanced chipmaking supply chain at the exact moment China sanctions Japan over missiles with 1,000+ km reach into Chinese territory.
