Koreans are participating in the 1400th Wednesday Rally in front of Statue of Peace in Gwanghwamun.
/Photograph by Lee Da-young
On July 20th, six groups of university students, including the Peacenabi-network and the Progressive University Student Network, gathered near the Japanese Embassy in the central Seoul to protest against Japan’s economic actions against South Korea. They held a rally in front of the statue of peace to protest against Japan’s economic actions and distortions of history. The students’ protest highlights the recent deepening conflict between South Korea and Japan. The Prime Minister of Japan, Abe Shinzo, had unilaterally notified the Korean government of export restrictions. Regarding this, a full-fledged public debate has begun on the Korea-Japan conflict. Japan’s tougher export controls on Korea include items: semiconductor and military goods manufacturing, which Korea depends on for nearly 90 percent of its import.
The reason why the Korea-Japan conflict has become a public debate
Japan recently declared its exclusion of South Korea from the White Country List (WCL). The WCL is a list of trusted trading partner countries where Japan gives preferential treatment for exports. Also, it refers to a country that the Japanese government believes has no security problems. In other words, if the country is designated as a “White Country,” the process will be simplified by preferential treatment when exporting high-tech technologies and products that threat to security guarantees. The reason why the procedure is becoming simpler is that licensing procedures are exempted when goods are exported from Japan.
In 2004, Japan added Korea to the WCL. However, on August 2nd, 2019, South Korea was excluded from the WCL and would not be able to receive preferential treatment from August 28th. Exclusion from the WCL means Japan will review the preferential treatment of export controls that it used to provide to Korea. Experts predict that Korea’s economy could be affected after being excluded from the WCL. From now on, 1,120 strategic goods that are currently imported to South Korea will be subject to export permits on a case-by-case basis. Strategic goods include several items such as semi-conductors, displays, and batteries. If Japan does not approve or delays the export of these goods, it will be difficult to produce the products, which will deal with a heavy blow to the relevant Korean industries. Also, for now, all exports except timber and food are subject to government approval.
There are many causes of Japan’s export regulations
Japan’s economic actions could be related to problems with its history. In November 2018, the Healing Foundation responsible for the Japanese military sexual slavery reconciliation agreement was dissolved. The dissolution of the foundation highlighted that South Korea did not agree with Japan’s refusal to recognize Korean women’s forced military mobilization. So, Korea provoked Japan by dissolving this socially controversial foundation.
Furthermore, there is another problem related to history. The latest Japan’s regulation could be economic revenge against the ruling of the Supreme Court of Korea on compensation for Japan’s forced labor. The Korean court has offended Japan by ruling in favor of the forced labor victims. Therefore, the government has been cashing in on the seized assets of a war criminal company that did not pay any compensation, effectively causing damage to Japan.
Also, political problems may be the cause of Japan’s export restrictions. First of all, it could be a domestic political issue in Japan. On July 21st, the Upper House election was held in Japan. Japan’s economic retaliation could be a strategy for the Abe administration to win the election. It is openly showing its intention to use export regulations of three semiconductor materials in elections. As other parties are strongly opposed to the Liberty Democratic Party (LDP)’s policies, including a hike in consumption tax, the move is interpreted as an attempt to achieve an election victory through “diplomacy” rather than “internal politics.” In addition, diplomatic issues are also at work. The regulation is aimed at turning the current South Korean government into a pro-Japanese one. Because of the two decisions regarding the past mentioned above, the Japanese government has a strong objection to the Korean government. So, it may be intended to warn South Korea by taking economic retaliation.
Woo Jung-moo, the Professor of the Department of Political Science commented, “The most important reason for the Japanese government’s restriction on Korean exports seems to be its attempt to secure and maintain the number of seats available for constitutional amendment in both chambers of the House. They are doing it by creating ‘the rally-round-the-flag effect’ through the deterioration of relationship between Korea-Japan.” He added, “This effect means that when a nation faces an external crisis, political leaders become more supportive of its citizens. For instance, the surge in support of the Abe administration when North Korea conducted missile tests that violated Japanese airspace has been linked to this effect.”
The problem is that North Korea has recently begun negotiations with the U.S. and is not causing Japan’s external crisis anymore. With the Abe administration’s approval rating declining due to a number of corruption scandals, the North Korean issue is no longer valid, even though it wants to use the effect of rallying before the Upper House elections. As an alternative to this, it is the diplomatic relations with Korea that the Abe administration has brought up. The Abe administration is based on Japan’s ultra-rightist forces. These forces deny the fact that Japan had military sexual slavery of Korea and they had forceful conscription. Also, they do not agree that Japan was a colonial power at the past time. Meanwhile, the policy preferences of Japanese ultra-rightist forces became significantly lower after the President Moon Jae-in appeared in Korea.
Professor Woo referred that “In other words, although Abe knows that it hurts the Japanese economy in the long run, it is reasonable to say that the Japanese government has decided to restrict exports in order to achieve short-term election results right away.
Korean government suggests measures in response to Japan's export restrictions
The Korean government is also responding to the conflict. In response to Japan’s unilateral notification of export restrictions, the Korean government is taking this opportunity to reduce its export reliance on Japan. So, the government has adopted a pro-business stance. In contrast to the current policy stance that had been harsh on companies, the government has decided to reduce the burden on large companies at this time. As a short-term measure, the government calls for checking whether materials and parts that are affected by Japan’s export regulations can be replaced with domestic or other imported items. As a medium and long-term measure, the government has streamlined administrative procedures and expanded fiscal spending. It also announced a “discretionary work system” that allows flexible adjustment of the 52-hour system, which is limiting working hours for workers’ rights. Since, the working hour is limited, companies could focus on thier work hardly.
Currently, the discretionary work system would be applied for Research and Development (R&D), Information Communication Technology (ICT), media, publishing, and design. This work system is directly related to R&D, which helps develop core semiconductor materials that are directly hit by Japan’s export regulations. In addition, the government will shorten the approval period for chemicals only for R&D technology and other necessary areas. In other words, Japan’s latest economic retaliation could be beneficial in the long run. It should be dangerous to have a lot of structural projects that depend on only one country. Othewise, the economy might collapse if relations with that country get worse, just like the case of China. To be more specific, China has taken economic retaliation against South Korea since Korea installed THAAD, which is the missile defense system. In the process, South Korea’s Hyundai cars were not exported and there was a noticeable drop in the number of Chinese travelers.
Considering this, Professor Woo said, “It is natural that the Japan government’s decision will cause economic damage to both Korea and Japan. As mentioned earlier, however, I do not believe that the Korean government’s current response is excessive or insufficient.” He said, “The direction to respond to the Japanese government’s restrictions on exports should be focused on lowering the cost of Korea while keeping the Abe administration from getting benefits as much as possible from the restrictions.”
According to Professor Woo Jung-moo, the Korean government’s move to secure support from the international community through communication with neighboring countries without taking an emotional response in the early stages of the situation. Korean government is also seeking specific measures to support the domestic industry, and seems to go far from reducing the damage to Korea caused by Japan’s economic sanctions. Furthermore, it minimizes the Japanese government’s interests generated by economic sanctions. In other words, the criticism of the current Korean government’s response seems not convincing. However, the short-term economic slump may occur, but given the size of Korea’s GDP, it does not appear to be impossible. The damage to the vulnerable can be mitigated through the government’s expansion of the welfare budget and support budget for small and medium-sized enterprises. So rather, looking at and responding to long-term economic benefits is also considered reasonable.
Koreans are participating in protests and demonstrations against Japan
On July 5th, there was a one-man protest in front of Myeongdong Uniqlo. The protester was an ordinary university girl who was a member of Krhana, a civic group for peaceful unification. She was holding a signboard saying “Economic retaliation without compensation for forced labor.” This is not the end of the protest. Now in Korea, there are lots of protests against Japan or demonstrations voicing the opinions of South Koreans.
Six university students, members of “Anti-Japanese Busan Youth Students Action Group,” also staged a surprise demonstration at the Busan Japanese Consulate. They yelled out “Japan to stop economic retaliation,” and “Japan to apologize.” A large number of Korean university students are participating in protests against Japan.
About 60 students of Peacenabi-network, a college student club dedicated to resolving the Japanese military sexual slavery issue, and five other university student organizations gathered under the name of “College students march for peace.” They marched in anger over the Japanese government’s movement to revive militarism without reflecting on its history of war crimes. Lee Tae-hee, the national representative of Peacenabi-network said, “Abe administration imposed stricter export regulations on Korea.” He added, “Abe said, the agreements of Japanese military sexual slavery in 1965 and 2015 are the cause for export regulation. The move was a ploy by the Abe administration to win Japan’s upper house elections on July 21 at the time, citing disgusting Korea.” By winning the Upper House election, the Abe administration wanted to amend the constitution toward a warable country. On the eve of the Upper House election, on July 20th, a group of university students, including the Peacenabi-network, held a march to denounce the Japanese government’s economic retaliation and move for revival of militarism and to call for peace on the Korean Peninsula.”
Regular citizens have also been protesting. In Incheon, for example, people from “NO Abe NO Japan Incheon Action,” an union of “Incheon Network for Peace & Welfare,” “Incheon Merchant Association,” and 17 other groups, held a demonstration in front of the Statue of Peace in Bupyeong park on August 8th. They also held a press conference there, saying that their goal is to protect the economic sovereignty of Korea and overcome Japan’s economic aggression.
This is only a small part of the protests against Japan. Many South Koreans, regardless of their generation, are participating in the demonstrations, which are ongoing. On August 14th and 15th, with the fact that it was the day of 74th anniversary of Korea’s independence, a lot of people gathered at Gwanghwamun. They held a demonstration in front of the Japanese Embassy with a pamphlet reading “No Abe.” Even in the evening, a candlelight vigil was held to denounce Abe, involving about 15 thousand citizens.
There are many posters in Gwanghwamun about the demonstration that takes place on National Liberation Day.
/Photograph by Lee Da-young
Korea is Boycotting Japan, saying “NO JAPAN”
After July 4th, the day when the Japanese government began measures to regulate exports to Korea of key semiconductor materials, the boycott movement began in the earnest. On Social Network Service (SNS), people uploaded posts telling people to boycott Japan, writing “Do not go” and “Do not buy,” with the boycott list. Through this, more and more people have engaged in the boycott movement by using the hashtag, “No Japan.” The boycott seems to have had some success. In the case of Uniqlo, the most representative Japanese company, July sales have decreased by 30 percent compared with that of last year. Uniqlo is currently having a huge discount, but sales are continually decreasing. Even, the Jongno branch, which has been in place for ten years, has indicated it will not be renewing its lease. The number of sales for Japanese beer also dropped 63 percent from June. The drop in sales left a lot of stock, and eventually, markets and convenience stores stopped ordering Japanese beer.
The boycott is also affecting the number of people travelling to Japan. As Korean tourists are the largest share of Japan’s tourism industry, refraining from travelling to Japan can deal a blow to the Japanese economy. Therefore in spite of the peak season, the average daily number of people booking trips to Japan is about 70 percent lower than usual according to Hana Tour and Mode Tour. Korean tourists have also been cancelling reservations they made before the boycott started. Indeed, many people have cancelled trips to Japan at the expense of cancellation fees. According to the domestic travel agency, the cancellation rate for Japanese packages was up to 80 percent. Low-cost carriers, which mainly sell short-haul flights, sell flights to Japan at a special price, but sales are low.
Furthermore, the Korean boycott of Japanese goods and services spread through the internet. The results of the boycott were also shared on the internet, and this, in turn, made people realize how effective it was and want to participate.
The Jongno Uniqlo, which is the main branch, had finally brought out a lease sale on the aftermath of the act of Japan boycott.
/Photograph by Cho Moon-kyung
How has Japan reacted?
While Koreans are boycotting Japan, what is Japan doing? They had an effect on art and the media. They removed the statue of peace. At the Aichi Triennial, Japan’s largest international art festival, the statue was forcibly removed three days after it was presented. Japan’s Chief Cabinet Secretary and the incumbent governor were behind its removal. The Japanese government is responding by intervening in the art world.
Meanwhile, a Korean far-right political group, the so-called Taegeukgi unit, said the Korean leader is ignorant and Korea should apologize to Japan. They represent just a very small section of opinions in Korea. However, the problem is that Japanese media reported the opinions of the Korean far-right political group as if it represents the majority of Korean public opinion. This is how the Japanese government has reacted to the boycott.
Is this the right way to respond?
There must be people who are concerned with the current method of response. The reason they are worried is that judging from the short-term economic benefits, both countries are set to suffer. Also, they insist that we need rational judgment rather than an emotional response. They think it is dangerous to act recklessly since shopkeepers of Japan related business are getting loss. Emotional responses such as this can often result in small business owners suffering from damage. Shopkeepers who do business under the Japanese brand, such as ABC Mart and Descente, are affected. Owners of Izakaya, a Japanese-style restaurant that has nothing to do with Japan’s gain, suffered a loss since Koreans prefer not to go to a place that seems to be related to Japan.
Someone may want to use Japanese products which they actually find useful. Also, some people may want to go on a trip to Japan. However, they do not use Japanese products and cancel reservations because they are worried about the opinions of the people around them. It has become difficult to use Japanese products because of the social atmosphere fostered by the boycott. Kim Min-ju (Freshman in school of Business) of Yonsei University, said “I was embarrassed when I had to use irreplaceable Japanese goods. Also, in the early days of the boycott, I used a product that I did not know that it was from Japan and got the attention of people around me.”
Furthermore, since the boycott began, there have been lots of car-related incidents. Somebody defaced and vandalized a Japanese car by writing the word “traitor” on it. This situation is still ongoing, and some repair shops and gas stations would not accept Japanese cars to be repaired or fill up the gas.
Regarding the prospect between Korea and Japan, Professor Woo said, “Although Korea-Japan relation is currently strained, I think it is right to continue economic cooperation with Japan if the conflict subsides somewhat. Of course, the historical issues will continue to hamper the development of Korea-Japan relations, but Japan is still a very influential country in terms of economy and security in the international community. For the sake of Korea’s stable economic development and security, I think it would be helpful to have friendly relations with Japan.” Lee Tae-hee also said “I think the essence of the current problem is anti-Abe, not anti-Japanese. As Japan is actively criticizing the Abe administration, I believe that the people of Korea and Japan should come together to criticize the Abe administration, not to revise the pacifist constitution, and speak out for peace in Northeast Asia.”
Cho Moon-kyung, Lee Da-young email@example.com
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