South Korea is removing Japan from a list of trusted trading partners, escalating a dispute with its neighbor that is already disrupting the global supply chain for big tech companies.
Trade Minister Sung Yun-mo said Japan will be downgraded from most trusted status to a new category, citing Tokyo’s violations of “the basic principles of the international export control regime.”
The downgrade means South Korean companies exporting to Japan will have to complete more documents, allow more time for approvals and get used to shorter lifespans for permits. South Korean officials did not mention specific materials or items that will be affected.
Tension between the two countries has been rising for months, stemming in part from Japan’s colonial rule over the Korean peninsula in the early 20th century. South Korea’s top court recently ruled that its citizens can sue Japanese companies for using forced Korean labor during World War II. Japan has denied that the two issues are linked.
South Korea is open to discussions with Japan if the Japanese government requests them, Sung said. The minister said the decision was made based on discussions that took place last week, and “is not a corresponding measure to a recent regulation announced by the Japanese government.”
He was referring to Japan dropping South Korea as a preferred trading partner earlier this month.