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President Moon warns Japan: ‘A necessary response when Korean companies are harmed’

Updated: Jul 13, 2019

문 대통령 “한국기업 피해 땐 필요한 대응” 일본에 경고, July 8, 2019

In response to restrictions on the export of core materials for semi-conductors and display devises being led by Japan’s Prime Minister Shinzo Abe, President Moon Jae-in on Jul 8 warned that ‘the vicious cycle of response and recrimination is definitely not what either nation wants,’ yet ‘if damage to Korean companies actually occurs, as the representative government we will have to respond.’

문 대통령 “한국기업 피해 땐 필요한 대응” 일본에 경고

In a meeting with his chief of staff on that day, President Moon also said ‘actions (undertaken by the Japanese government) aimed at restricting mutually beneficial dealings between private enterprises for political objectives are of concern not only to Korea, but to the entire world.’ This is the first time that President Moon has directly spoken about the Japanese government’s steps towards imposing export restrictions. President Moon’s statement could be interpreted as a warning in respect to Japan’s Prime Minister Abe taking issue with the South Korean government’s implementation of sanctions against North Korea and taking additional steps aimed at restricting exports on the previous day.

President Moon said the priority is for a cool and calm response. He said ‘In the case of an unprecedented emergency, nothing is more important than intimate communication and cooperation between the government and the business community.’ He also said ‘The public and private sectors need to join together to examine the structure of our emergency response systems. Both the Blue House* and the relevant government department will be mobilised, and as the situation develops, will personally listen to the difficulties encountered by affected companies, discuss with them a solution, and spare no expense to provide necessary assistance’. He stressed that ‘On the other hand, the government will continue to keep calm and work hard for a diplomatic solution’ and ‘‘the vicious cycle of response and recrimination is definitely not what either nation wants.’

However, President Moon made clear that he will not just sit back and ignore matters if Korean companies are harmed due to the Japanese government’s export restrictions, or if they are prolonged. President Moon urged that ‘‘if damage to Korean companies actually occurs, as the representative government we will have to respond’ and ‘I call on the Japanese side to retract these measures and [partake in] a sincere consultation between both countries. He urged the Japanese government by stating ‘I hope for a return to the belief of the international community that trade must be a tool for common prosperity and to the principle of free trade which Japan has always championed.’

At the same time, President Moon expressed his intention to treat the situation as a blessing in disguise by exploiting it as an opportunity to localize [the supply of] core materials. He stated ‘the government will make nurturing the parts, materials and equipment industries one of the top priorities of the nation’s economic policy, and will support companies by fully mobilizing all available resources, such as the budget and taxation.’ He also said ‘Taking a medium to long term view, we will use this as an opportunity to resolve structural problems in our economy that have accumulated over several decades. We will develop a more reciprocal and balanced trade relationship between Korea and Japan to improve the large trade deficit.’ He also urged cooperation, stating ‘Only when the governing and opposition parties and the people unite their efforts can the difficulties faced by the government and industry be overcome.’