Asia

Survey Shows Japanese Companies Back Abe’s Plan to Curb Exports to South Korea

Three-quarters of companies in the monthly Reuters Corporate Survey approved Prime Minister Shinzo Abe’s tough trade stance against South Korea, including his explanations for curbing exports to South Korea of materials used to make computer chips.
Sputnik

More than nine in 10 predicted Japan would win if Seoul takes its complaints to the World Trade Organisation, according to the Reuters poll.

The acrimonious trade dispute between Japan and South Korea, two US allies, grew out of a row over wartime forced labour. Abe tightened curbs on exports to South Korea of three high-tech materials needed to make memory chips and display panels in July. The Japanese government also cancelled South Korea’s fast-track trade status in the beginning of August.

Removing South Korea from a “whitelist” of favoured export destinations could leave some Japanese exporters facing more paperwork and on-site inspections before they can win permits, slowing Korea-bound exports for a wide range of goods.

In the survey, companies were split on whether the trade curbs will affect the Japanese economy. Some companies said they won’t be affected as they don’t directly engage in business with South Korea. Those seeing an impact from the export curbs expressed concerns including the global slowdown and spreading trade frictions, worsening Japan-South Korea ties, weaker corporate profits and long-term competitiveness of their firms.

In opinion polls last month, the liberal Asahi newspaper found 56% of the public felt Abe’s trade moves were “reasonable”, while the conservative Yomiuri found 71% supported the measures.

The trade dispute between the two countries is believed to be a response to a South Korean court's verdict in June that Japanese companies must provide compensation to victims of forced labour during the Japanese colonisation of the Korean Peninsula between 1910-1945.

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