Japan Will Restore South Korea’s Preferred Trade Country Status: Minister

The national flags of Japan (L) and South Korea flutter in the wind ahead of the arrival of South Korean President Yoon Suk-yeol at Haneda Airport in Tokyo on March 16, 2023. - Yoon was set to arrive in Tokyo for a summit aimed at boosting ties in the face of Pyongyang's growing aggression. (Kazuhiro Nogi/AFP via Getty Images)

Japan will reinstate South Korea to its list of preferred trading partners on July 21—the first time in four years since they downgraded each other’s trading status over historical disputes.

Japanese Trade and Industry Minister Yasutoshi Nishimura said on June 27 that the two countries have agreed to establish a follow-up framework for reviewing the export control systems of both countries if needed.

Lee Do Woon, spokesperson of South Korean President Yoon Suk-yeol, called Japan’s step a symbolic measure that underscores the countries’ “fully restored bilateral trust” and the removal of uncertainty in trade.

“For the first time in four years, all export restrictions between the countries have been lifted,” Lee told reporters. “With import and export procedures getting simplified, we expect exchanges and cooperation between the countries’ companies to accelerate.”

South Korea made a similar move on April 24 to reinstate Japan to its “white list” of preferred trading partners, which will shorten the review period for exporting strategic materials to Japan from 15 to 5 days.

South Korea and Japan removed each other from their respective preferential trade lists in 2019 after a South Korean top court ruling that ordered Japanese firms to compensate wartime forced laborers, causing their bilateral relations to deteriorate.

The finance ministers of both countries were also expected to meet in Tokyo on June 29, Kyodo News reported, marking the revival of a financial dialogue that had been stalled for seven years due to historical disputes.

South Korea-Japan Ties

Concerns about North Korea’s nuclear threats have prompted the nations to work toward mending their ties. The leaders of both countries agreed to restore bilateral ties at a Tokyo summit in March.

Japanese Prime Minister Fumio Kishida said he would lift export controls on key industrial materials to South Korea. South Korea opted to compensate victims of forced labor with local funds rather than pushing Japanese companies to pay compensation.

Kishida visited South Korea on May 7 for talks with Yoon and vowed to deepen cooperation in tackling global security challenges. He became the first Japanese leader to visit the country in over a decade.

South Korean President Yoon Suk Yeol (R) shakes hands with Japanese Prime Minister Fumio Kishida during a joint press conference after their meeting at the presidential office in Seoul on May 7, 2023. (Jung Yeon-je/Pool Photo via AP)

“The situation in the international community makes cooperation between Japan and the ROK all the more indispensable,” Kishida said at a joint news conference, referring to South Korea’s official name, the Republic of Korea.

Kishida said negotiations on reviving their countries’ military intelligence-sharing pact were in progress to counter the North Korean regime’s nuclear and missile threats. The pact, signed in 2016, had been stalled since 2019 due to their wartime forced-labor dispute.

The Japanese leader expressed that his “heart aches” for the many Koreans who suffered through a very difficult and sad experience in the “harsh environment” of Japan’s 1910–1945 colonial rule.

“There are various histories between Japan and South Korea, but it is important for Japan to carry on the efforts of its predecessors who overcame difficult times and to cooperate with President Yoon and South Korea toward the future,” he said.

The Associated Press contributed to this report.