Japanese tourism, retail stocks tumble as China warns citizens against travel amid Taiwan dispute – Firstpost

Japanese tourism and retail shares fell sharply on Monday after China warned its citizens to avoid traveling to the East Asian country over Prime Minister Sanae Takachi’s comments about Taiwan.

Long-standing ties between China and Japan took a further hit this month when Takaichi suggested Tokyo could intervene militarily in any emergency on the self-ruled island.

Asia’s two largest economies are closely linked, with China the biggest source of tourists to Japan, with about 7.5 million arriving in the first nine months of 2025, according to Japan’s National Tourism Bureau.

In the third quarter, they spent 590 billion yen ($3.8 billion), accounting for about 28 percent of total spending by international tourists, transport ministry data shows.

Shares in cosmetics form Shiseido fell nearly nine percent on Monday, department store group Takashimaya fell more than six percent and Uniqlo owner Fast Retailing fell nearly six percent. Japan Airlines fell 3.9 percent.

Before taking power last month, Takachi, an ally of former Prime Minister Shinzo Abe, was a vocal critic of China and its military buildup in the Asia-Pacific.

His comments on 7 November were widely interpreted to mean that an attack on Taiwan, just 100 kilometers (60 mi) from the nearest Japanese island, could guarantee Tokyo’s military support.

Takaichi, 64, told parliament that if Taiwan’s emergency “involves warships and the use of force, it could become a situation threatening (Japan’s) existence, no matter which way you cut it.”

Japan’s self-established rules state that it can act militarily only under certain conditions, including an existential threat.

The comments came just days after Takaichi met with Chinese President Xi Jinping for an apparently cordial first meeting on the sidelines of the APEC summit in South Korea.

Takaichi, who has visited Taiwan in the past and called for closer cooperation, also met separately with Taipei’s representative at the summit.

China and Japan summoned each other’s ambassadors last week, after which Beijing advised its citizens to avoid traveling to Japan.

In a now-deleted post on X, Chinese Consul General in Osaka Xue Jian threatened to “cut off that filthy neck”, apparently referring to Takachi.

Beijing insists that Taiwan, which Japan occupied for decades until 1945, is part of its territory and has not ruled out the use of force to regain control.

Top officials from the Foreign Ministry for Asia-Pacific Affairs visited China on Monday, Japanese media reports said.

Masaaki Kanai, director general of the Bureau of Asian and Oceanic Affairs at the ministry, was due to hold talks with his Chinese counterpart Liu Jinsong, reports said.

He said Kanai was expected to reiterate Japan’s position that Takaichi’s remarks do not change Japan’s traditional position and would also lodge a protest over the Chinese diplomat’s social media posts.

economic hit

The diplomatic dispute was even worse news for Japan’s economy, which shrank 0.4 percent in the third quarter, official data showed on Monday.

Marcel Théliant at Capital Economics warned that current tensions with China risk escalating into a “full-fledged trade dispute” similar to a previous dispute in the early 2010s.

“There are a number of paths this could take, but the biggest risk is that China restricts rare earth exports or Japan bans exports,” Thieliant said ahead of the GDP release.

“Carmakers look particularly vulnerable as they are already under immense pressure from the rise of Chinese electric vehicle makers,” he said.

(Except for the headline, this story has not been edited by Firstpost staff.)