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Seoul drums up support from Washington amid trade row with Tokyo

Economy 09:27 July 26, 2019

By Kang Yoon-seung

SEOUL, July 26 (Yonhap) -- Key officials from the United States and its business community have expressed concerns that Japan's export restriction against South Korea would hurt the global tech supply chain, as well as U.S. companies, Seoul's trade ministry said Friday.

Trade Minister Yoo Myung-hee visited Washington this week to highlight that Tokyo's restrictions could disrupt global supply chains and have a negative impact on not only Asian companies but the world's largest economy.

Yoo met various political and business officials, including U.S. Commerce Secretary Wilbur Ross and Rep. Eliot Engel (D-NY), chairman of the House Committee on Foreign Affairs, according to the Ministry of Trade, Industry and Energy.

According to the ministry, Commerce Secretary Ross acknowledged and understood the negative impact of Japan's measures on the global supply chain and the U.S. industries.

Yoo also requested the U.S. government to take necessary actions to induce Japan to retract the measure, although Washington has not expressed plans to mediate the row between the two Asian allies, the ministry said.

She also held meetings with a group of U.S. trade associations, which sent a letter to trade ministers of Seoul and Tokyo earlier this week claiming Japan's export curbs would undermine the global supply chain and deliver long-term damage to the global manufacturing sector.

Starting this month, without prior notice, Japan implemented strict regulations for exports of three key materials to South Korea, which is expected to slam the production of semiconductors and displays, the two major export products for Asia's fourth-largest economy.

Tokyo claims the move came in response to Seoul's lax export control system on goods that can be diverted for military purposes by third-party countries, implying North Korea.

The South Korean government, which denies the allegation, believes the move came as an economic retaliation against a Seoul court's ruling that ordered Japanese companies to compensate South Korean workers forced into labor during World War II. The Korean Peninsula was under Japan's exploitive colonial rule from 1910-45.

Japan is currently moving to remove South Korea from a "whitelist" of trusted importers, which could affect an additional 1,000 industrial items. Once approved by the Japanese Cabinet, Seoul will be stripped from the whitelist, which means that preferential export procedures would not be applied to South Korea.

Seoul sent a letter protesting the delisting to Japan earlier this week, and called for the immediate lifting of both ongoing and upcoming export restrictions.

South Korean Trade Minister Yoo Myung-hee (R) shakes hands with U.S. Commerce Secretary Wilbur Ross in Washington on July 25, 2019, in this photo provided by the Ministry of Trade, Industry and Energy. (PHOTO NOT FOR SALE) (Yonhap)


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