South Korea to remove Japan from preferred trade list

Seoul's announcement is seen as retaliation after similar move from Tokyo igniting fears of wider consequence.

    Protesters in Japan urged Prime Minister Shinzo Abe last week to reverse its recent decision against South Korea [Eugene Hoshiko/AP]
    Protesters in Japan urged Prime Minister Shinzo Abe last week to reverse its recent decision against South Korea [Eugene Hoshiko/AP]

    South Korea has announced that it has decided to remove Japan from a list of nations receiving preferential treatment in trade, in what was seen as a countermeasure to Tokyo's recent decision to downgrade Seoul's trade status amid a diplomatic dispute.

    South Korean Trade Minister Sung Yun-mo said on Monday that the government decided to remove Japan from the country's 29-country "white list" because it has failed to uphold international principles while managing its export controls on sensitive materials.

    Sung and other South Korean officials did not specify what they saw as Japan's problems in export controls. They say that Seoul will work to minimise negative effects on South Korean exporters and bilateral trade.

    It was not immediately clear how South Korea's tightened export controls would affect bilateral trade.

    Seoul said South Korean companies exporting to Japan will be able to receive exceptions from case-by-case inspections that are normally applied to exports to nations with lower trade status and go through a faster approval process they currently enjoy.

    Sung said the changes are expected to come into effect sometime in September, following a 20-day period for gathering public opinion on the issue and further regulatory and legislative reviews.

    He said Seoul is willing to accept any request by Tokyo for consultation over the issue during the opinion-gathering period.

    South Korea's announcement came weeks after Japan's Cabinet approved the removal of South Korea from a list of countries with preferential trade status.

    Seoul had promised to retaliate while accusing Tokyo of weaponising trade to retaliate over political rows stemming from their wartime history.

    Japan's move came weeks after it imposed stricter controls on certain technology exports to South Korean companies that rely on Japanese materials to produce semiconductors and displays for TVs and smartphones, which are key South Korean export items.

    SOURCE: AP news agency