hankyoreh

Major participants in a second meeting among government officials

The South Korean government is currently mulling over the exact timing of when to lodge a legal complaint with the World Trade Organization (WTO) against Japan, which has pushed through tougher regulations on the export of strategic materials to South Korea.

Seoul has made various efforts to change Japan’s attitude, including repeated requests for dialogue, a campaign to win international sympathy, and the decision to terminate its intelligence-sharing agreement with Japan, known as the General Security of Military Information Agreement (GSOMIA). If Japan nevertheless implements the tougher controls on Aug. 28, the timing of the WTO complaint is likely to be accelerated. The government and the business community are methodically implementing measures they’ve devised to minimize fallout, such as diversifying sources of imports.

Multiple sources in the government and the ruling party who spoke with the Hankyoreh on Aug. 27 said that, if Japan implements the revised export and trade management regulations on Aug. 28, with the effect of removing South Korea from its white list of countries that enjoy streamlined screening of strategic material exports, Seoul is likely to soon lodge a complaint against Japan at the WTO.

“We’ve wrapped up our technical review of legal matters related to lodging a complaint with the WTO,” said an official at South Korea’s Ministry of Trade, Industry, and Energy.

The government is expected to lodge the complaint at a moment strategically chosen to underline the illegitimacy of Japan’s measures, both to a domestic and international audience.

During a meeting at the main government office in Seoul on Tuesday morning, the heads of related ministries, including Minister of Economy and Finance and Deputy Prime Minister Hong Nam-ki, and Lee Ho-seung, senior presidential secretary for economic affairs, reviewed the countermeasures that the government has prepared for Japan’s export controls.

Reportedly, discussion during the meeting focused on a plan that has been jointly developed by related ministries. This plan calls for strategic investment in research and development (R&D) of parts, materials, and equipment, including key parts needed to counter Japan’s export controls, and innovative R&D methods designed to respond swiftly to industrial demand for parts, materials, and equipment. If Japan implements its revised regulations on Aug. 28, this plan is expected to be finalized and announced during an expanded meeting of ministers, presided over by Prime Minister Lee Nak-yeon.

“I believe that the Japanese government will not further aggravate the situation. As long as it doesn’t do so, I think our two governments can reach a breakthrough in the current situation,” Lee Nak-yeon said during a meeting of senior officials from the ruling party, the government, and the Blue House that was held at his residence in Seoul’s Samcheong neighborhood on Tuesday.

The business sector also seems to be bustling. Samsung Electronics, SK Hynix, and their suppliers have stepped up efforts to diversify their supply of three key materials already under tougher restrictions, including high-purity hydrogen fluoride. They have requested assistance from countries that traditionally have been major producers of semiconductors, such as Singapore, the US, Germany, and Taiwan, and are running tests on products made by local companies.

“We’ve diversified our supply not only of the three affected materials but also other materials and equipment, and in exceptional cases we can also purchase materials from companies that are eligible to receive three-year bulk licenses through Japan’s International Compliance Program,” said a source at a semiconductor element manufacturer.

This source did acknowledge that, “Since the supply might be cut off at any time, we’re working to buy up as many parts and materials as possible and also trying to use them more sparingly in production.”

“We completed a number of preparations over the past month. Since most of our suppliers are established Japanese firms, we shouldn’t have any serious difficulties with the supply, but we’ve stocked up materials just in case,” another source in the semiconductor materials industry said.

By Choi, Ha-yan, Shin, Da-eun and Lee, Kyung-mi, staff reporters

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