China's Travel Warning to Japan Amid Taiwan Tensions Impacts Japanese Stocks
Japan's tourism and retail stocks experienced significant declines following China's warning to its citizens to avoid traveling to Japan. This move comes amid escalating tensions over Taiwan, with both nations having summoned each other's ambassadors the previous week.
China's advisory against travel to Japan affected key Japanese companies: Shiseido's shares dropped nearly 10%, while Takashimaya and Fast Retailing, the owner of Uniqlo, each fell more than 5% in early trading. China remains one of the top sources of tourists to Japan, amplifying the economic impact of the warning.
The Taiwan issue lies at the heart of the dispute. Taiwan is situated approximately 100 kilometers south of Japan's nearest island. Beijing considers Taiwan a breakaway province and has not ruled out the use of force to assert control. Many Taiwanese see themselves as a separate nation but predominantly favor maintaining the current status quo.
Amid these tensions, Japan's Prime Minister Sanae Takaichi, known for her critical stance towards China, stated that Tokyo could take military action if Beijing were to attack Taiwan. She cited Japan's 2015 security law, which permits the Self-Defense Forces to respond in situations where the nation's survival is threatened.
