Seoul, March 19 (IANS) South Korean exports to Japan will rise 3.5 trillion won ($2.69 billion) this year if Seoul’s export structure to Tokyo returns to the status it had in the 2017-2018 period before a trade dispute flared up in 2019, a business lobby said on Sunday.
Japan accounted for 4.5 per cent of South Korea’s overall exports in 2022, down 0.4 percentage point from an average of 4.9 per cent for the 2017-2018 period, according to a report released by the Korea Chamber of Commerce and Industry (KORCHAM).
Steel, petrochemicals, electronics and auto parts companies will benefit if the two countries put their estranged ties back on track after years of a trade dispute over key materials, the KORCHAM report said.
In 2019, Tokyo imposed export controls on three materials critical for the production of semiconductors and flexible displays, and officially removed South Korea from its list of nations given preferential treatment in trade in apparent retaliation for the South Korean Supreme Court’s ruling that ordered Japanese companies to pay compensation to Korean forced labour victims.
In response to the export controls, South Korea filed a complaint with the World Trade Organisation (WTO) over the trade dispute, calling it a discriminatory act, Yonhap news agency reported.
Relations between Seoul and Tokyo warmed significantly after South Korea announced its decision earlier this month to compensate victims of Japan’s wartime forced labour on its own without asking Japan for contributions.
On Thursday, Seoul decided to withdraw the complaint filed with the WTO as Tokyo vowed to lift its export restrictions on the three materials — fluorine polyimide, photoresist and hydrogen fluoride — to South Korea.
On the same day, South Korea President Yoon Suk Yeol and Japanese Prime Minister Fumio Kishida held a summit in Tokyo.