Tue, Aug 13, 2019 - Page 1 News List

South Korea to remove Japan from preferred trade list

OFF THE WHITE LIST:South Korea divides its partners into two groups for exports of sensitive materials, but plans to create a special in-between bracket just for Japan


South Korean Minister of Trade, Industry and Energy Sung Yun-mo speaks during a news conference at the government complex in Sejong yesterday.

Photo: AP / Yonhap

South Korea yesterday said that it has decided to remove Japan from a list of nations receiving preferential treatment in trade in what was seen as a tit-for-tat move following Tokyo’s recent decision to downgrade Seoul’s trade status amid a diplomatic row.

It was not immediately clear how South Korea’s tightened controls would impact bilateral trade.

Seoul said some South Korean companies exporting to Japan would be able to receive exceptions from case-by-case inspections that are normally applied on sensitive shipments to nations with lower trade status and go through the same fast-track approval process that they currently enjoy.

Japanese Vice Minister for Foreign Affairs Masahisa Sato said he believes the impact of Seoul’s move would likely be limited, as Japan does not import much sensitive materials from South Korea.

Japan provided similar exceptions while removing South Korea as a favored trade partner, which eased some of the fears in Seoul about a possible blow to its export-dependent economy, where many manufacturers heavily rely on parts and materials imported from Japan.

After spending weeks berating Tokyo for allegedly weaponizing trade and vowing retaliation, South Korean President Moon Jae-in yesterday struck a more conciliatory tone, saying that his government would refrain from “emotional” reactions to Japan over the trade dispute.

“While maintaining unwavering resolve and calmness, we need a long-term approach to look for fundamental countermeasures,” Moon said in a meeting with senior aides.

South Korean Minister of Trade, Industry and Energy Sung Yun-mo said Seoul decided to remove Japan from a 29-member “white list” of countries that enjoy minimum restrictions in trade because it has failed to uphold international principles while managing its export controls on sensitive materials.

Park Tae-sung, a South Korean trade official, said that Seoul was making a legitimate effort under domestic and international laws to improve its export controls.

South Korea currently divides its trade partners into two groups while managing the exports of sensitive materials that can be used both for civilian and military purposes.

Seoul would create a new in-between bracket where it plans to place only Japan, which “in principle” would receive the same treatment as the non-favored nations in what is now the second group, Sung said.

Sung said the changes are expected to enter effect sometime next month, following a 20-day period for gathering public opinion on the issue and further regulatory and legal reviews.

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