China’s Export Controls on Japan: Salami-Slicing or Strategic Signalling?
Daiju Wada
October 8, 2026
Image: Keitma / Shutterstock
In today’s international political economy, interstate rivalry and diplomatic friction are increasingly intertwined with economic interdependence. Trade restrictions and export controls can provide governments with powerful instruments of strategic influence, particularly when supply chains depend heavily on a limited number of countries. China’s tightening of export controls affecting Japan illustrates this broader transformation. One possible interpretation is that Beijing is employing a form of’ ‘salami-slicing‘: gradually expanding restrictions rather than immediately imposing a comprehensive embargo, thereby maintaining pressure while preserving room for further escalation. However, other explanations, including political retaliation and strategic signalling, must also be considered.
The reasons behind China’s export controls on Japan are closely connected to the deterioration of bilateral relations, particularly over Taiwan and Japan’s evolving security policy. In November 2025, Japanese Prime Minister Sanae Takaichi made remarks concerning a possible Taiwan contingency, which Beijing strongly criticized. China subsequently linked its tightening of trade and export controls to what it described as Japan’s interference in the Taiwan issue. On January 6, 2026, China announced tighter controls on dual-use exports to Japan, explicitly citing remarks by Japanese leadership concerning possible armed intervention in the Taiwan Strait as part of the rationale.
This suggests that the measures can also be understood as political signalling or retaliation. Rather than simply seeking to impose economic damage, Beijing may be attempting to demonstrate that actions it regards as crossing sensitive security thresholds can generate tangible economic consequences. The export controls could therefore serve two purposes simultaneously: responding to Japanese policies while signalling that deeper Japanese involvement in a Taiwan contingency could carry additional economic costs.
Another possible interpretation is the logic sometimes associated with the Chinese expression “kill the chicken to scare the monkey”: imposing costs on a particular target in order to send a broader warning. By targeting selected Japanese companies and organizations rather than immediately restricting Japanese trade as a whole, China can demonstrate its ability to impose economic pressure while avoiding the disruption associated with a comprehensive embargo. This interpretation is particularly relevant because several of the entities targeted by recent measures are connected to Japan’s defence and security sectors.
China has progressively expanded such measures. On February 24, 2026, Beijing placed 20 Japanese entities on an export-control list and another 20 on a watch list. The entities included companies and organizations involved in areas such as aerospace, defence, maritime systems and advanced technology. On June 29, China added another 20 Japanese entities to its export-control list and 20 more to its watch list. Beijing presented these measures as necessary to protect national security and prevent activities that could contribute to enhancing Japan’s military capabilities.
The pattern nevertheless contains characteristics associated with salami-slicing. Rather than adopting a single comprehensive embargo, China has introduced and expanded restrictions in stages. This approach allows Beijing to calibrate the degree of pressure according to developments in the bilateral relationship while retaining additional options for future escalation. At the same time, gradual escalation does not by itself demonstrate that salami-slicing is the underlying strategy. The pattern may simply reflect Beijing’s responses to successive developments in Japan–China relations.
This distinction is important because economic restrictions can have effects beyond the products or companies directly targeted. Japan remains closely connected to China through manufacturing and supply chains involving rare earths, critical minerals, machinery, electronics, and other industrial inputs. China’s restrictions on rare earths have already created uncertainty for Japanese industries. Reuters reported in June 2026 that exports of several heavy rare earths to Japan remained severely constrained amid the diplomatic dispute. Such restrictions demonstrate how economic measures can affect industries that are highly dependent on Chinese supplies.
The strategic significance therefore lies not only in the immediate economic impact of individual restrictions but also in the uncertainty they generate. Companies may become more cautious about relying on Chinese suppliers if they believe future licensing decisions could be influenced by diplomatic developments. Even where an export is not formally prohibited, the possibility of tighter screening, delayed approvals or additional restrictions can encourage firms to diversify their supply chains. Economic pressure can thus emerge not only through formal restrictions but also through changing expectations about future access to critical inputs.
For Japan, the challenge is consequently broader than responding to individual Chinese measures. Tokyo must determine whether each restriction represents a temporary diplomatic response, an attempt to influence Japanese security policy, or part of a longer-term strategy to exploit economic dependence. These explanations are not necessarily mutually exclusive. Political retaliation can occur alongside strategic signalling, while incremental implementation can simultaneously produce characteristics associated with salami-slicing.
China’s export controls on Japan should therefore not be reduced to a single strategic concept. ‘Salami-slicing’ provides one useful framework for understanding the gradual expansion of economic pressure, but retaliation over Taiwan-related statements, strategic signalling, and China’s broader national-security approach to export controls offer alternative and potentially complementary explanations. The measures may represent not one fixed strategy but the interaction of several objectives.
For Japan, the central issue is how to manage the intersection of diplomacy, national security, and economic interdependence. Strengthening supply-chain resilience, diversifying critical sources of supply, improving early-warning capabilities, and maintaining channels of dialogue with China will become increasingly important. As economic interdependence becomes more deeply integrated into strategic competition, understanding both the visible restrictions and the political signals behind them will be essential to Japan’s economic security.
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