A spat over Taiwan is threatening China-Japan ties

**Japan’s New Prime Minister Stirs Tensions with China Over Taiwan**

*BEIJING* — Less than a month into her term, Japan’s conservative leader has heightened tensions with China by suggesting that a Chinese move against Taiwan could prompt a Japanese military response.

China objects strongly to the involvement of other countries in Taiwan, notably the United States, which is the main supplier of weapons to the self-governing island. Beijing claims Taiwan as its own territory, insisting it must come under its control. Chinese officials have repeatedly referred to the issue as a “red line” that others should not cross.

### Takaichi’s Stronger Stance

Speaking to a parliamentary committee on November 7, Prime Minister Sanae Takaichi said that a Chinese naval blockade or other aggressive actions against Taiwan could be grounds for a Japanese military response. Her comments marked a departure from past Japanese statements.

While previous prime ministers expressed concern over China’s threat to Taiwan, none had publicly specified how Japan might respond in such scenarios. Takaichi later declined to retract her remarks but told the same parliamentary committee three days later that she would avoid discussing specific scenarios going forward.

A longtime supporter of Taiwan, Takaichi views China as a growing threat and has ordered an acceleration of plans to boost Japan’s military spending. Meanwhile, Foreign Minister Toshimitsu Motegi stated on Friday that Japan’s official position on Taiwan has not changed.

### China’s Stern Warnings

Takaichi’s comments sparked an uproar in China. The foreign and defense ministries, the Taiwan Affairs Office, and state media all weighed in with sharp warnings. Wang Huiyao, president of the Beijing-based Center for China and Globalization think tank, described the remarks as surprising given the current relatively low tensions over Taiwan.

“We can’t just let the prime minister speak so openly at parliament,” Wang said.

One of the first officials to respond was China’s consul general in Osaka, who posted a now-deleted social media message warning that China has no choice but to cut off an intruding “dirty neck.” Foreign Minister Motegi called this post “extremely inappropriate.”

China’s Foreign Ministry summoned Japan’s ambassador on Thursday to warn against any interference in Taiwan. The following day, Japan’s Foreign Ministry summoned China’s ambassador in Tokyo to protest the consul general’s social media post.

### Beijing Raises the Stakes

On Friday night, China escalated tensions further by issuing a travel advisory against visiting Japan. Chinese tourists accounted for about 7.5 million visits during the first nine months of this year—the largest number from any country and roughly one-fourth of Japan’s total tourists.

China’s Education Ministry also issued a warning to Chinese students regarding recent crimes against Chinese nationals in Japan, although it stopped short of advising students not to travel.

Additionally, on Sunday, China’s coast guard announced patrols around a group of uninhabited islands claimed by both countries.

A greater concern for Japan would be if China restricted exports of rare earth magnets, crucial components in auto manufacturing and other industries. There were no immediate indications China was considering such a move.

Japanese officials are working to ease tensions. Motegi said he planned to request that China provide “an appropriate response” to prevent significant damage to bilateral relations.

### The U.S.-Japan Alliance and Japan’s Military Limitations

Japan’s position is complicated by its post-World War II constitution, which bans the use of force except for self-defense. Japan’s military is officially called the Self-Defense Force.

Former Prime Minister Shinzo Abe broadened the military’s mandate in 2015 by winning parliamentary approval of a law allowing Japan to aid an ally—most likely the United States—in a conflict deemed an existential threat to Japan.

Takaichi, who rose politically as a protégé of Abe, suggested that a Chinese move against Taiwan could constitute such a threat, triggering a strong reaction.

Analysts also say that a conflict involving North Korea that draws in the United States could similarly qualify.

Previously, Japan has not specified what exactly constitutes an existential threat under what is called the principle of collective self-defense.

### No Retraction Amid Rising Tensions

Japan’s government is reluctant to withdraw Takaichi’s remarks, as doing so could limit its options in a potential Taiwan crisis. Backpedaling might also damage the new prime minister’s high public approval ratings and her reputation as a hawk on China.

As tensions continue to simmer, all eyes remain on Tokyo and Beijing, as well as the broader geopolitics surrounding Taiwan and regional security in East Asia.
https://www.npr.org/2025/11/17/g-s1-98081/spat-over-taiwan-china-japan

Digital Euro Faces Uncertain Future as Brussels Rethinks Its Purpose

The European Union’s Digital Euro Faces a Critical Crossroads

The European Union’s long march toward a digital euro has hit a crossroads. In Brussels, lawmakers are debating whether the continent even needs a central bank digital currency or if private innovation might already be fulfilling that role.

For years, the European Central Bank (ECB) has envisioned a public digital currency that would anchor Europe’s payment system in the 21st century. But a new parliamentary proposal could dramatically slow that momentum.

A Conditional Approach to the Digital Euro

The initiative, introduced by Fernando Navarrete of Spain’s center-right EPP group, argues that a digital euro should only exist if the private sector fails to build a seamless European payment network. In other words, the ECB’s project would become a backup plan, not the default future.

If approved, this “conditional” approach would redefine the EU’s digital finance agenda by prioritizing commercial innovation before central-bank intervention.

Private Competition First

Navarrete’s draft report envisions a “market test” before any online version of the digital euro goes live — a process that would require Brussels to confirm the absence of a pan-European retail payment system before giving the ECB the green light.

His argument is straightforward: if companies can deliver efficient, borderless payment systems on their own, there may be no reason to spend billions of euros building a state-run alternative.

“The ECB has been calling for a solution — public or private — to connect Europe’s payment systems,” Navarrete told reporters. “The private market should have the first chance to do that.”

Concerns and Criticism

Critics warn that this approach could derail years of technical and political progress.

The ECB views the digital euro not as competition to banks but as a guaranteed European alternative to U.S.-based payment networks such as Visa, Mastercard, and PayPal.

A Split Vision for Europe’s Money

The timing of Navarrete’s report has raised eyebrows. It arrived just as the ECB announced plans to begin pilot testing the digital euro in 2027, with a possible rollout in 2029.

This coincidence underscores a growing divide between the bloc’s technocrats, who want to move forward swiftly, and lawmakers, many of whom fear the ECB is moving too fast without sufficient proof of public need.

Navarrete insists he is not trying to kill the project. “I’m not for or against the digital euro,” he said. “But we must ensure stability and proportionality.”

The Offline Digital Euro Compromise

While the online version faces pushback, Navarrete’s plan supports developing an offline digital euro. This version would function more like digital cash stored locally on secure devices and transferrable even without internet access.

He argues this offline model would preserve Europeans’ right to hold central bank money “under all circumstances” without destabilizing the banking sector.

The report also calls for strict limits on how much digital euro any one person can hold — a safeguard against deposit flight from commercial banks during periods of stress.

ECB’s Response and Next Steps

The ECB has responded cautiously, describing the proposal as a “constructive step” toward Parliament’s position while reaffirming its commitment to completing preparatory work.

“Europe needs a payments system that works everywhere and for everyone,” said Executive Board Member Piero Cipollone, adding that the digital euro project remains vital for economic sovereignty.

Despite this, the central bank faces an uphill political battle. With several parties skeptical about the necessity of a digital euro, reaching consensus could take years. Legislative negotiations are not expected to conclude before mid-2026.

Between Sovereignty and Market Reality

Europe’s digital currency debate captures a larger philosophical divide: Should the future of money be designed by central banks or discovered by the market?

For ECB supporters, a digital euro symbolizes independence — a European answer to American and Chinese payment dominance.

For skeptics, it is a bureaucratic solution in search of a problem.

Navarrete’s proposal effectively challenges the ECB to prove its relevance: if private firms can unify Europe’s fragmented payment systems, the digital euro may never need to exist.

Whether that bet pays off will depend not on ideology, but on what happens first — innovation from the market, or exhaustion from Brussels.

The information provided in this article is for educational purposes only and does not constitute financial, investment, or trading advice.

Source: Coindoo agencies.

https://coindoo.com/digital-euro-faces-uncertain-future-as-brussels-rethinks-its-purpose/