On June 24, Guo Jiaqun, a spokesperson for the Chinese Ministry of Foreign Affairs, confirmed that two Japanese citizens were detained by Chinese authorities for violating Chinese laws. On the same day, Yoshihiro Kosaka, Chief Cabinet Secretary of Japan, revealed at a press conference that China informed Japan that the two individuals were detained on suspicion of 'smuggling goods and items prohibited from import and export by the state'.
This incident has quickly attracted international media attention. The British "Financial Times" pointed out on the 24th that since Japanese Prime Minister Yoshihiko Kōshui made wrong remarks regarding Taiwan in November last year, relations between China and Japan have been very tense, and this case could further exacerbate the situation. A corporate executive stated bluntly that this means Japanese companies have once again been warned, and it also indicates that China has never reduced its pressure on Japan.
Morihara Minor confirmed on the same day that China informed the Japanese embassy in China that two Japanese citizens were detained on May 18th and 25th due to suspicion of smuggling prohibited items. He refused to disclose more details on the grounds of privacy, but stated that the Japanese government would take appropriate measures to protect its citizens and communicate with the relevant parties.
According to a report by Japan's Kyodo News on the 24th, these two individuals were detained in Dalian in May due to 'the same case'. It seems that they were involved in violating Chinese export controls and attempting to transport rare earth-related products abroad.
Rare earths are crucial raw materials in the global technology supply chain. To maintain the stability and security of the global supply chain for key minerals, China has been working to standardize and improve its export control systems.
On the same day as the news of the arrest of those two Japanese employees came out, Bloomberg and other foreign media also reported that the Chinese Ministry of Commerce increased its efforts to crack down on rare earth smuggling on the 24th. It called on the public to report violations through online reporting platforms or telephone hotlines.
China Ministry of Commerce website
The Ministry of Commerce of China stated that whistleblowers can report 13 actions suspected of violating relevant laws and regulations, including the unauthorized export of dual-use strategic minerals, and circumventing the export control regulations for dual-use strategic minerals by passing through third countries.
The New York Times noted that Hiromi Koizumi’s wrong statements regarding Taiwan made him unpopular in China last November. In the following months, China significantly tightened its control over Japan’s rare earth exports. According to the Nikkei Asian Review, China’s exports of rare earths to Japan decreased by more than 80% in March and April this year, forcing Japanese companies to urgently seek alternative sources of supply.
Japanese government officials told the Financial Times that Kaise Asami's remarks have had an impact on Japan-China bilateral relations. Japanese companies have been under direct pressure due to this diplomatic friction, and the latest incident may make the business environment for Japanese companies in China even more complex.
A senior executive of a company based in Tokyo, specializing in the import of Chinese key minerals, said that Japanese companies will regard the recent detention incidents as “another warning signal”. This also indicates that China has never reduced its pressure on Kei Yoko Takahashi regarding her remarks.
Regarding the latest announcement, the Chinese Ministry of Commerce stated that further improving the reporting and handling of strategic mineral dual-use items and enhancing law enforcement capabilities are fundamental requirements for perfecting the export control system. It is also a normal measure to safeguard national security and interests. At the same time, this is an internationally accepted practice; many countries around the world have relevant regulations. By learning from these countries' experiences and improving China's export control system for strategic mineral dual-use items, it is possible to effectively prevent such items from being used for illegal purposes, thereby better maintaining world peace and demonstrating China's responsibility as a responsible major country.
The Ministry of Foreign Affairs of China also emphasized, "Japanese nationals and businesses in China should be educated and reminded to comply with Chinese laws and regulations."
