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Seoul should prove Tokyo violates free trade rules
South Korea has decided to file a complaint with the World Trade Organization (WTO) against Japan for its discriminatory trade measures. The decision comes 69 days after Tokyo imposed export restrictions on three key materials which are crucial for Korean companies making semiconductors and display panels.
For Seoul, it is inevitable to initiate a legal battle with Tokyo which has refused to resolve the problem through dialogue and compromise. In this regard, bringing the ongoing trade dispute to the WTO is a step in the right direction. It is aimed at publicizing the unilateral and illegitimate nature of Japan's action and finding a solution through the international trade body.
Announcing the decision Wednesday, Trade Minister Yoo Myung-hee said "Japan's measures were a discriminatory act directly targeting South Korea." She sent a clear message that Tokyo's export restrictions violate WTO rules which are based on the spirit of free and fair trade.
In addition, Yoo also described Japan's move as "politically motivated" following the South Korean Supreme Court's rulings ordering Japanese firms to compensate surviving Korean victims of forced labor during Japan's 1910-45 colonial rule of the Korean Peninsula. In other words, Tokyo's action is none other than economic retaliation against the rulings.
In many respects, the Shinzo Abe administration is weaponizing trade for political purposes, even though it has denied this. Prime Minister Abe, his Cabinet ministers and other officials have repeatedly said Japan has taken the export curbs because of its "damaged trust" in Korea. This implies that the trade measure was taken in retaliation against the forced labor rulings.
Another point of contention is the Japanese government's argument for "national security." Tokyo has insisted that it has imposed export curbs due to security concerns, claiming that some dual-purpose materials, which can be diverted to military use, were funneled into North Korea through South Korean firms. But Japan has yet to provide any evidence to prove its claim.
There is a strong possibility that Japan is violating article 11 of the General Agreement on Tariffs and Trade (GATT) which bans regulations on export volumes unless the products have a serious impact on national security. Such regulations can only be acceptable in exceptional cases including war or similar military conflicts.
In conclusion, Japan's trade measure cannot be justified because it is highly likely a breach of WTO rules and obligations. The measure is not in line with a ban on any discriminatory act against any member countries, especially for favored trade partners. It also runs against a ban on restricting trade for political reasons.
The government should make thorough preparations to prove that the neighboring country's trade action lacks legitimacy. It also needs to engage in active diplomacy to create a favorable atmosphere to confront Japan in the WTO.
We urge Japan to retract its export curbs and put Korea back on its "whitelist" of trusted trade partners. Most of all, the two countries need to resolve the trade row soon diplomatically.
