Trade War Could Take off Between Japan and South Korea – but What Will the United States Do?

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Society has faced countless trade wars over the years that have been waged by countries on every inhabited continent for innumerable reasons. In modern times, the most recent example of a true trade war comes in the form of the strained relations between the United States and the People’s Republic of China, between which the first tariffs were implemented in early 2018.

The world’s next trade war is likely to arise between Japan and South Korea, as relations between the two East Asian countries have been particularly strained in recent weeks.

Earlier today, on Wednesday, July 17, 2019, Hong Nam-ki, the Finance Minister of South Korea, shared with reporters via a regularly scheduled press conference that the country was in the process of planning to limit its own dependence on raw materials and goods coming out of Japan.

Unlike the reasons for the trade war between the United States and China, which had been brewing for multiple decades, South Korea’s and Japan’s relationship was strained less than three weeks ago, on July 1, 2019.

On this date, Japan announced regulatory cutbacks on its own businesses’ exports of any photoresists, fluorinated polyimide, and hydrogen fluoride. Unless you’re a chemist, you probably don’t recognize that these three chemicals are highly important in the manufacturing of semiconductors, which are one of the most important exports being shipped out of South Korea.

Further, Japanese officials took South Korea off of its list of countries that are known to utilize reliable measures of control in screening their exports, also known as white countries.

One of the reasons why Japan instituted such restrictions is because its decision-makers got wind of a report that an undisclosed amount of hydrogen fluoride originally hailing from Japan was handed over to North Korea after Japanese exporters sent it to South Korea.

Since July 1, South Korean officials have made at least one formal request to Japan to get rid of its restrictions on the three materials, though it was denied.

According to the trade ministry of South Korea, the country is slated to voice its concerns at the annual general council meeting of the World Trade Organization next week.

Roughly a week ago, a leading United States diplomat, David Stilwell, informed Japan’s NHK, its public broadcast network, that the U.S. wouldn’t get involved. However, in a Seoul-based meeting with South Korean officials earlier today, Stilwell reported that the U.S. would get involved in “all issues … related to South Korea and the United States.”

As such, it isn’t clear what the United States will actually end up doing, if anything.

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