China Threatens Economic Retaliation Over Japan's Chipmaking Curbs

China has threatened severe economic retaliation against Japan if it further restricts sales and services of chipmaking equipment to Chinese firms. Toyota Motor warned that Beijing could cut Japan's access to essential minerals for automotive production. Japan began these restrictions in alignment with U.S. trade controls.

China has issued a stern warning of severe economic retaliation should Japan tighten restrictions on sales and servicing of chipmaking equipment to Chinese firms, according to Bloomberg News. In a recent report, Toyota Motor alerted Japanese officials that Beijing might respond by limiting Japan's access to crucial minerals vital for automotive production.

Several Chinese officials reiterated this position during recent discussions with their Japanese counterparts, the report revealed. Both Toyota and the Chinese foreign ministry did not provide immediate comments to Reuters on the matter.

Japan initiated these restrictions on 23 types of semiconductor manufacturing equipment in July, aligning its technology trade controls with a U.S. initiative aimed at limiting China's capabilities in advanced chip production.