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By APD writer Alice
South Korea on June 2 announced that it will reopen a complaint at the World Trade Organization (WTO) over Japan's restrictions on exports major industrial materials to the country.
However, South Korea's trade ministry said the country is still willing to negotiate with its neighbor to resolve their multi-month dispute.
Half a year ago, South Korea decided to withdraw its complaint as a goodwill gesture to seek a breakthrough in solving the trade dispute through bilateral talks.
Trade relations between South Korea and Japan have heated up after Tokyo abruptly tightened the export of three high-tech materials used in the semiconductor and display production, including fluorinated polyimide, resist and hydrogen fluoride to South Korea from July 2019.
In August that year, Japan continued to exclude South Korea from the "White List" of trusted trade partners.
Tokyo removed part of the export curbs ahead of the two countries' summit in December. But since then, it has taken no further action on this issue.
In May 2020, Seoul again called for Tokyo to lift its trade restrictions by the end of the month, and called on Japan to work together to overcome the economic consequences caused by the COVID-19 pandemic.
However, Japan has not changed its mind. South Korea said it received a response from Japan before the deadline on May 31. Although it did not provide details, Seoul implied that Tokyo's response "did not meet expectations".
Na Seung-sik, an official from the South Korean Ministry of Trade, Industry and Energy, said his government deems that it is difficult for normal dialogue with Japan, which is the premise to suspend the complaint at the WTO.
Therefore, South Korea will reopen the dispute settlement process at the WTO on Japan’s trade curbs, he said, adding that the Korean government will soon request the WTO’s Dispute Settlement Body open a panel to look further into the case.
According to South Korea, the trade row has caused more damage to Japanese exports than those of South Korea. Seoul’s exports to its neighbor in 2019 dropped 6.9% to $28 billion from a year earlier. But exports from Japan to South Korea dropped more than 12.9% to $47 billion.
For Seoul, however, the removal of trade barriers is crucial as the export-reliant economy strives to overcome the current COVID-19 crisis. The suspended business activities and travel across the globe due to the pandemic have already put great strains on its exports. South Korea’s outbound shipments fell for a third consecutive month, plunging 23.7 percent on-year in May.
(ASIA PACIFIC DAILY)
