Blog: Dave LeggettStakes raised in China-Japan spat

Dave Leggett | 24 September 2010

China and Japan are apparently having a little spat with each other over maritime territorial rights. I think we've heard that kind of thing in the news before. Usually it proves a storm in a teacup, the countries concerned sometimes playing out a ritual that is as much for domestic consumption as it is about, say, legitimate fishing or territorial rights.

But the Chinese have just raised the stakes in the latest dispute by stopping exports of 'rare earth elements' to Japan. That could have implications for certain products made in Japan where they are needed in industrial manufacturing, including hybrid cars.

Yes, it will probably all blow over soon, but the dispute may well have got Toyota's attention. The diplomatic problem is bigger now that the stakes in the dispute have been raised: how can it be resolved so that no-one has obviously lost face?

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