Samsung’s top man heads to Japan as export restrictions bite

Darnell Taylor
July 11, 2019

South Korea's Democratic Party said in a statement on Thursday it would include up to 300 billion won ($254.8 million) in an extra budget to cope with Japan's export limits on high-tech materials.

As part of its new trade restrictions, Japan's trade ministry had said individual applications will be needed for permission to export to South Korea three materials: fluorinated polyimide, hydrogen fluoride and resists.

He was responding to South Korean President Moon Jae-in's request for a diplomatic solution thorough "sincere" bilateral discussions, urging Tokyo to withdraw what he described as a politically motivated measure. Tokyo hasn't elaborated but Prime Minister Shinzo Abe and his conservative aides have hinted there may have been illegal transfers of sensitive materials from South Korea to North Korea.

South Korea is expected to put more pressure on Japan while working to win the understanding of the worldwide community for its argument that the Japanese measure is problematic.

Deputy Chief Cabinet Secretary Kotaro Nogami on Wednesday claimed that the measures are within boundaries recognized by the World Trade Organization, and reiterated the claims that there are cases that cast doubts on South Korea's management of sensitive materials.

Tokyo now wants a third-country arbitration panel to resolve the dispute, but Korea has rejected the call and reported Japan to the WTO.

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The Japanese government is also seeking consultation on whether South Korea should be removed from its "white country list".

The approval process takes 90 days, which will effectively halt imports by South Korea companies such as Samsung, LG, and SK Hynix of the materials for the time being. Exports to South Korea were once exempt from the procedure.

Former Japanese ambassador to the United States, Ichiro Fujisaki, said in an interview with Reuters on Wednesday that "I don't think we need the United States to mediate, just like Japan would not mediate U.S. -Mexico ties or U.S". South Korea's policies on the peninsula have fallen out of step with that of the USA, it said. According to Reuters, experts believe South Korea's current stockpiles will only last for four months.

South Korea has summoned a Japanese Embassy official to protest Abe's suggestion that it could not be trusted to faithfully implement sanctions against North Korea.

He called for the government and private companies to form an "emergency response system" to deal with the impact of the Japanese trade curbs and prepare for the possibility that the dispute drags over an extended period.

Choi was referring to the South Korean court's ruling that assets of Japanese firms involved in press-ganging Koreans should be liquidated to compensate the victims.

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