Japanese tourism and retail stocks fell on Monday after China warned its citizens not to travel to the country as Tokyo and Beijing remain locked in a dispute over Taiwan.
Japan’s Prime Minister Sanae Takaichi, who has been an outspoken critic of China and its military activities in the region, suggested this month that Tokyo could take military action if Beijing attacked Taiwan.
Shares in cosmetics company Shiseido plunged nearly 10%, while department store chain Takashimaya and global fashion chain owner Uniqlo fell more than 5% in early trading.
China has consistently ranked among the top sources of tourists visiting Japan.
“If there are battleships and the use of force, no matter how you think about it, it could constitute a situation that threatens survival,” Takaichi said in parliament on November 7.
A “survival-threatening situation” is a legal term under Japan’s 2015 security law, which refers to when an armed attack against its allies presents an existential threat to Tokyo.
In such a situation, Japan’s self-defense forces may be called upon to respond to the threat.
Last week, both countries summoned their ambassadors and Beijing later urged its citizens to avoid trips to Japan.
Taiwan is located about 100 kilometers (60 miles) south of the nearest Japanese island.
Beijing views Taiwan as a breakaway province that will eventually be part of the country, and has not ruled out using force to achieve this.
But many Taiwanese consider themselves part of a separate nation, although most favor maintaining the status quo in which Taiwan does not declare independence from or join China.
