Asia Intelligence Brief for Thursday, February 24, 2026

1 China blacklists 40 Japanese defence firms — dual-use export ban escalates diplomatic crisis — 20 entities on full export control list (Mitsubishi Heavy shipbuilding/aero engines, Kawasaki Heavy, IHI, Fujitsu, National Defence Academy); 20 more on watch list (Subaru, Mitsubishi Materials, Institute of Science Tokyo); rare earth and critical mineral supply chains weaponised; targets Japan’s “remilitarisation and nuclear ambitions”; Mitsubishi Heavy −3.1%, IHI −7%, Kawasaki Heavy −5%; Tokyo demands withdrawal; post-Takaichi landslide retaliation

2 Pakistan airstrikes break Afghan ceasefire — nuclear-armed neighbours on collision course — F-16s/JF-17s hit 7 TTP/ISKP camps in Nangarhar and Paktika Feb 22; Pakistan claims 70–80 militants killed; Afghan Taliban says civilians including women and children among dead; Kabul summons ambassador, vows “appropriate response”; follows Islamabad mosque bombing (31 dead), Bajaur checkpoint attack (11 soldiers + 1 child); Qatar/Turkish/Saudi mediations failed

3 ICC Duterte hearing Day 4 — first Asian ex-head of state faces crimes against humanity charges — four-day confirmation hearing (Feb 23–27) at The Hague; prosecution presents evidence of 76 murders under “war on drugs”; Duterte waived appearance, called transfer “kidnapping”; defence accuses Marcos Jr of facilitating ICC cooperation; Senators Go and Dela Rosa named as co-perpetrators; 60-day ruling period follows; Philippine domestic politics inflamed

4 Seoul–Washington clash over Freedom Shield scope; South Korea rejects trilateral drills with Japan — joint announcement postponed as President Lee pushes to scale back field training; US opposes, says troops already deployed; Seoul separately rejects US-proposed trilateral exercises with Japan over Takeshima Day sensitivity; wartime OPCON transfer test deferred; alliance management under strain

5 Section 122 tariffs reshape Asian trade — China drops from 41% to 15%, India 26% to 15% — SCOTUS struck down IEEPA tariffs; Trump’s 15% Section 122 replacement effective Feb 24; 150-day clock expires Jul 24; Section 232 probes into semiconductors, pharma, critical minerals still active; Malaysia’s PM Anwar says MITI monitoring; Taiwan says implementation unclear; India–US trade talks on hold

Pakistan–Afghanistan

China–Japan

Taiwan Strait

Korean Peninsula

China’s Commerce Ministry added 20 Japanese entities to a full dual-use export control list and 20 more to a watch list on February 24. The targets include the shipbuilding, aero engine, and maritime machinery subsidiaries of Mitsubishi Heavy Industries, divisions of Kawasaki Heavy Industries and Fujitsu, IHI Corporation, and the National Defence Academy. The measures ban Chinese-origin dual-use items from reaching these entities, including seven categories of rare earths and associated critical minerals. Foreign organisations globally are also prohibited from transferring Chinese-origin items to blacklisted firms.This is the most significant escalation of China’s economic coercion campaign against Japan since the 2012 Senkaku crisis. Japanese defence stocks fell sharply — IHI dropped nearly 7%, Kawasaki Heavy 5%, Mitsubishi Heavy 3.1%. However, Japanese companies are known for maintaining substantial rare earth stockpiles, meaning supply disruptions may take months to materialise. The deeper issue is structural: Japan’s defence-industrial modernisation under Takaichi — constitutional revision, strike capabilities, semiconductor investment — depends on supply chains that run through the country it is deterring. This is China’s leverage, and Beijing is now using it explicitly.

Pakistan’s military launched airstrikes on seven TTP and ISKP camps across Nangarhar and Paktika provinces in eastern Afghanistan on February 22, using F-16 and JF-17 fighters. Islamabad claims at least 70–80 militants were killed, citing “conclusive evidence” that recent attacks — including the February 6 Islamabad Shia mosque bombing that killed 31, the Bajaur checkpoint bombing that killed 12, and the Bannu convoy attack — were planned by Afghanistan-based handlers. Afghanistan’s Taliban government condemned the strikes as a violation of sovereignty, said civilians including women and children were killed, and vowed an “appropriate response.”The October 2025 Qatar-mediated ceasefire is now effectively dead. Three separate mediation tracks — Qatari, Turkish, and Saudi — have all failed. India’s growing engagement with the Taliban government adds a new dimension that unsettles Islamabad. Pakistan faces a strategic dilemma: its eastern border with India remains tense after last May’s four-day military confrontation, while its western border with Afghanistan is now an active conflict zone. The nuclear dimension shadows every escalation.

The ICC’s four-day confirmation of charges hearing against former Philippine President Rodrigo Duterte is concluding this week (Feb 23–27) at The Hague. Prosecutors have charged Duterte with crimes against humanity for 76 murders and two attempted murders under his “war on drugs” campaign between 2011 and 2019, though actual killings are estimated at up to 30,000. Duterte, 80, waived his right to appear, calling his March 2025 arrest a “kidnapping” facilitated by President Marcos Jr. The prosecution named Senators Bong Go and Bato Dela Rosa as co-perpetrators. Duterte’s defence team accused Marcos of using a “silent partner” to funnel witnesses to the ICC.This is the first time an Asian former head of state has faced ICC charges. The political implications extend well beyond the courtroom: the Marcos–Duterte alliance that delivered the 2022 election has completely fractured, with Vice President Sara Duterte now an active opposition figure. A confirmation of charges (60-day ruling window) would commit the case to trial and could reshape Philippine politics for years — Duterte remains hugely popular domestically, and the hearing has already inflamed nationalist sentiment around sovereignty and ICC jurisdiction.

The joint Seoul–Washington announcement on Freedom Shield exercises has been postponed as President Lee Jae-myung pushes to scale back field training components. The US opposes the reduction, noting troops are already deployed. Seoul separately rejected US-proposed trilateral military drills with Japan, citing sensitivity around Takeshima Day (February 22). The wartime operational control (OPCON) transfer test — a long-standing milestone for alliance maturation — has been deferred again.Beijing is exploiting the divergence masterfully. Lee’s January Beijing summit produced 24 export contracts, and Chinese media reported South Korea overtook Japan as the top outbound flight destination from China. North Korea’s Kim Jong-un visited China for the first time in six years, signalling thawed Beijing–Pyongyang ties. South Korea is at a strategic crossroads: the US wants Seoul to increase defence burden-sharing within the first island chain, while Beijing offers economic incentives to pull Seoul away from Japan-aligned trilateral structures. June 3 local elections will test Lee’s calibration.

After the US Supreme Court struck down Trump’s IEEPA tariffs, the President imposed 15% global tariffs under Section 122 of the Trade Act of 1974, effective February 24. Asia’s effective US tariff rates dropped dramatically — China from 41% to 15%, India from 26% to 15%, Indonesia from 32% to 15%. But the 150-day statutory limit on Section 122 means these rates expire July 24 unless Congress acts. Meanwhile, Section 232 investigations into semiconductors, pharmaceuticals, and critical minerals remain active, creating a second tariff overhang.Markets reflect the ambiguity: Kospi hit another record on semiconductor strength, but Bitcoin fell 3% and gold surged to $5,200 on uncertainty pricing. The manufacturing relocation from China to Southeast Asia is accelerating regardless of tariff levels — the policy volatility itself is driving supply chain diversification. For Asia’s export economies, the reprieve may be temporary, and the structural shift is already locked in.