South Korea yesterday formally restored Japan to its list of preferential trading partners, three years after the neighbors downgraded each other’s trade status amid a diplomatic row fueled by historical grievances.
In announcing the move through a government gazette, the South Korean Ministry of Trade, Industry and Energy said that Seoul is further restricting technology and industrial exports to Russia and Belarus to support a US-led pressure campaign against Moscow.
After years of friction, Seoul and Tokyo are working to repair relations as they tighten their security cooperation with Washington to counter the threat posed by North Korea. Pyongyang has used the distractions caused by the war to accelerate testing of nuclear-capable missiles.
Photo: AP
South Korean officials said that Tokyo is likely to respond by restoring Seoul as a favored trading partner, but expect that step to take more time based on the procedures to revise Japan’s export regulations.
In September 2019, South Korea dropped Japan from its “white list” of countries receiving fast-track approvals in trade, reacting to a similar move by Tokyo.
Japan had also tightened export controls on key chemicals South Korean companies use to make semiconductors and displays, prompting South Korea to file a complaint with the WTO.
Seoul accused Tokyo of weaponizing trade to retaliate against South Korean court rulings that ordered Japanese companies to offer reparations to South Koreans forced into slave labor before the end of World War II, when Japan had colonized the Korean Peninsula. The 2018 rulings irked Japan, which insists all compensation issues were settled by a 1965 treaty that normalized relations.
Relations between the US allies began to thaw last month when South Korean President Yoon Suk-yeol, who took office in May last year, announced plans to use South Korean funds to compensate the forced laborers without requiring Japanese contributions.
Yoon traveled to Tokyo to meet with Japanese Prime Minster Fumio Kishida, and they vowed to rebuild security and economic ties.
Following that summit, South Korea withdrew its complaint at the WTO against Japan, as Tokyo simultaneously confirmed its removal of export controls over a set of chemicals considered vital to South Korea’s technology industry. The Japanese restrictions had covered fluorinated polyimides, which are used in organic light-emitting diode screens for televisions and smartphones, and photoresist and hydrogen fluoride, used for making semiconductors.
In announcing its new regulations over exports of strategic materials, the South Korean trade ministry also said the country is placing hundreds more industrial products and components under its export restrictions against Russia and Belarus beginning this week.
Seoul’s controls have covered 57 items, including those related to electronics and shipbuilding, with authorities banning their shipments to Russia and Belarus unless the companies obtain special approvals.
The list as of Friday is to cover 798 items, including exports related to construction, machinery, steelmaking, automobiles, semiconductors and advanced computing.
Semiconductor business between Taiwan and the US is a “win-win” model for both sides given the high level of complementarity, the government said yesterday responding to tariff threats from US President Donald Trump. Home to the world’s largest contract chipmaker, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), Taiwan is a key link in the global technology supply chain for companies such as Apple Inc and Nvidia Corp. Trump said on Monday he plans to impose tariffs on imported chips, pharmaceuticals and steel in an effort to get the producers to make them in the US. “Taiwan and the US semiconductor and other technology industries
SMALL AND EFFICIENT: The Chinese AI app’s initial success has spurred worries in the US that its tech giants’ massive AI spending needs re-evaluation, a market strategist said Chinese artificial intelligence (AI) start-up DeepSeek’s (深度求索) eponymous AI assistant rocketed to the top of Apple Inc’s iPhone download charts, stirring doubts in Silicon Valley about the strength of the US’ technological dominance. The app’s underlying AI model is widely seen as competitive with OpenAI and Meta Platforms Inc’s latest. Its claim that it cost much less to train and develop triggered share moves across Asia’s supply chain. Chinese tech firms linked to DeepSeek, such as Iflytek Co (科大訊飛), surged yesterday, while chipmaking tool makers like Advantest Corp slumped on the potential threat to demand for Nvidia Corp’s AI accelerators. US stock
The US Federal Reserve is expected to announce a pause in rate cuts on Wednesday, as policymakers look to continue tackling inflation under close and vocal scrutiny from US President Donald Trump. The Fed cut its key lending rate by a full percentage point in the final four months of last year and indicated it would move more cautiously going forward amid an uptick in inflation away from its long-term target of 2 percent. “I think they will do nothing, and I think they should do nothing,” Federal Reserve Bank of St Louis former president Jim Bullard said. “I think the
SUBSIDIES: The nominee for commerce secretary indicated the Trump administration wants to put its stamp on the plan, but not unravel it entirely US President Donald Trump’s pick to lead the agency in charge of a US$52 billion semiconductor subsidy program declined to give it unqualified support, raising questions about the disbursement of funds to companies like Intel Corp and Taiwan Semiconductor Manufacturing Co (台積電). “I can’t say that I can honor something I haven’t read,” Howard Lutnick, Trump’s nominee for commerce secretary, said of the binding CHIPS and Science Act awards in a confirmation hearing on Wednesday. “To the extent monies have been disbursed, I would commit to rigorously enforcing documents that have been signed by those companies to make sure we get