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Trade Tensions: Why Shinzo Abe Has a Critical Role to Play

Mieczysław Boduszynski, Gene Park
Reuters

Mieczysław Boduszynski, Gene Park

Security, Asia

More than ever, the world needs Japan, the third-largest global economy, to help reinvigorate the faltering trade system.

Trade Tensions: Why Shinzo Abe Has a Critical Role to Play

Relations between Seoul and Tokyo have reached a new low, adding new cracks to the postwar international order at just the wrong time. The immediate background of the latest spat was the South Korean Supreme Court’s 2018 decision to uphold a lower court’s ruling ordering a Japanese firm to compensate four Korean citizens who served as forced laborers during Japan’s colonial occupation. The Japanese government argues that a 1965 Normalization Treaty signed between the two countries precludes such litigation. As tensions surrounding the lawsuit escalated, the administration of Prime Minister Shinzo Abe imposed new regulations that will slow the approval time for the import of three chemicals vital to South Korea’s semiconductor firms, a move that could inflict serious harm on one of Korea’s biggest industries. The South Korean government then filed a complaint at the World Trade Organization. The Abe administration has hinted at additional trade restrictions, while the administration of South Korean president Moon Jae-in mulls its options. 

The Japanese government has good reason to be frustrated with Seoul. The South Korean government has resisted Tokyo’s proposal to deal with the matter of forced labor through arbitration consistent with the 1965 agreement and also reneged on a December 2015 deal with Japan to settle the sensitive issue of compensation for Korean women coerced into sexual servitude, known euphemistically as “Comfort Women.”

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