S. Korea revokes Japan’s status as preferred trade partner

Sep 18 , 2019. KYODO NEWS.

South Korea, in a tit-for-tat move, revoked Japan’s preferential trade partner status starting Wednesday, citing displeasure with the neighboring country’s export control regime.

The Trade, Industry and Energy Ministry, in a statement, said Japan will henceforth be among countries that face some limitations when importing strategic materials from South Korea.

The ministry said a public opinion survey conducted between Aug. 14 and Sept. 3 showed that 91 percent of respondents found revocation to be reasonable.

“The government will make sure that South Korean companies would experience as minimal impact as possible from the revocation,” it said while vowing full support from the government, especially in cases where small and medium-sized companies experience difficulties.

Japan, on Aug. 28, removed South Korea from its list of trusted trade partners that enjoy minimum trade restrictions on goods such as electronic components that can be diverted for military use.

It took that move after implementing tighter controls on exports of some materials needed by South Korean manufacturers of semiconductors and display panels, including Samsung Electronics Co. and SK Hynix Inc., in July.

Seoul has condemned the measures as “economic retaliation” for South Korean court rulings last year that ordered Japanese firms to compensate people claiming they were forced to work in Japanese factories during Japan’s 1910-45 colonial rule of the Korean Peninsula.

Japan maintains the issue of compensation was settled “finally and completely” by a 1965 bilateral agreement under which it provided South Korea with $500 million in financial aid.

Relations between the two countries have sunk to new lows recently amid history, trade and territorial disputes.

CR: KYODO NEWS