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Seoul, Tokyo set to meet over trade row, but breakthrough unlikely

All News 14:24 December 12, 2019

By Kang Yoon-seung

SEJONG, Dec. 12 (Yonhap) -- South Korea and Japan are set to hold a meeting next week in the latest fence-mending effort to resolve their monthslong trade row, but the two Asian neighbors are not likely to reach a compromise this year.

South Korea and Japan plan to hold high-level talks centered on export control systems in Tokyo on Monday, according to the Ministry of Trade, Industry and Energy.

It is the first official gathering of trade officials between the two Asian neighbors after Seoul "conditionally" suspended the termination of the General Security of Military Information Agreement (GSOMIA) with Japan last month.

Seoul and Tokyo are set to discuss various trade issues, including the management of sensitive technologies, export control systems and other pending issues between the two, according to the ministry.

Seoul, Tokyo set to meet over trade row, but breakthrough unlikely - 1

But they may fail to narrow down differences on key issues, at the upcoming meeting as they are still at odds over shared history, in particular about Japan's 1910-45 colonial rule of the Korean Peninsula.

Economic ties between Seoul and Tokyo have been facing an unprecedented deadlock since Japan imposed restrictions on exporting three key industrial materials critical for South Korea's chip and display industries in July. Japan also later removed Seoul from its list of trusted trading partners.

Tokyo cited South Korea's alleged lax export control system for sensitive materials that can be diverted for military use as the ostensible reason behind its export restrictions.

Seoul regards a series of measures as retaliatory against the country's Supreme Court ruling that ordered compensation for Koreans forced into labor during Japan's 1910-45 colonial rule of the Korean Peninsula.

To seek a compromise, South Korea decided to suspend its lawsuit filed against Japan at the World Trade Organization last month, but the two nevertheless have been making little progress in finding common ground.

Earlier this month, Japanese Trade Minister Hiroshi Kajiyama even said the on-going dispute will not be considered for the agenda and that the dialogue is not likely to lead to a reconciliation.

The Japanese official reiterated that Tokyo holds the right to determine its own export control policy, implying the trade conflict may last longer than expected.

"The issue is unlikely to be settled shortly, as it is complicated, and related to political issues as well," said Cho Gyeong-lyeob, a senior researcher at the Korea Economic Research Institute.

"South Korea decided to suspend the on-going legal procedures at the WTO, but the settlement will eventually depend on how the two countries agree on the wartime compensation issue," the researcher said.

Seoul aims to induce Tokyo to fully lift all export curbs and other regulations against Asia's No. 4 economy.

South Korean tech giants, such as Samsung Electronics Co. and SK hynix Inc., have not yet suffered serious and visible damage from Japan's export restrictions, but the lingering issue has been weighing on their business sentiment.

"The two countries should slowly narrow their differences, perhaps starting by reaching a small deal," said Mun Byung-ki, a senior researcher at the Korea International Trade Association. "We should first seek to induce Japan to refrain from rolling out any additional export restrictions."

Seoul, Tokyo set to meet over trade row, but breakthrough unlikely - 2


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