GP Insights

GP Insights # 418, 26 September 2020

East Asia: The new Japanese Prime Minister talks to the South Korean President
Harini Madhusudan

What happened?
On 24 September, the Japanese Prime Minister Yoshihide Suga and the South Korean President Moon Jae-in held a telephone conversation, marking the first interaction between the two leaders since Suga took office. Both sides have established the need to reset bilateral ties adding that the two countries are extremely important neighbours who must work together with the US to deal with the common issues that face them. 

Yoshihide Suga also held telephonic conversations with the leadership of India and China during the week. 

What is the background?
First, historical relations and the 1965 pact. Both countries share a complicated history. Imperial Japan forced people from the Korean island to work as labours in factories and mines and even made some enlist as soldiers when they were mobilizing for the world war. Japan is also known to have sent thousands of women from across Asia during the World War. Referred to as "comfort women", this has been an issue ever since. Though the Japanese rule ended in 1945, it was only in 1965  that the two countries through a treaty restored diplomatic ties after which the Japanese provided more than $800m (£620m) financial help. 

Second, economic interdependence. Japan and South Korea depend on each other for crucial materials for their industries, that include semiconductors and semiconductor manufacturing devices, flat panel display manufacturing devices, fine chemical materials, and optical devices. Japan is a dominant producer of those materials which are vital in the making of memory chips and display screens that are key industry supplies to South Korea. Apart from electronic supplies, the two countries have extensive economic interdependence in travel, food and culture, entertainment, clothing and myriad business collaborations. 

Third, deep-rooted public sentiments. In August 2019, the relations between the two countries worsened when some citizens from South Korea called for boycotting Japanese goods. The strong sentiments expressed by the people led to the governments announcing further restrictions against each other. In South Korea, there is a strong sentiment, that Japan shows no remorse over its wartime aggression or mistreatment of the comfort women.

Fourth, the court ruling in October 2018 and the worsening of relations. A Court in South Korea ordered the Japanese steelmaker to compensate four Korean citizens for labour during Japan's colonial rule. Tokyo refused to honour this ruling citing the 1965 agreement. As a response, Japan restricted exports of essential industrial material to South Korea, hitting the country's tech industry. In July 2019, trade tensions began with Japan's decision to place national security restrictions on the export of three critical chemicals for the production of semiconductors. Subsequently, both countries announced the removal of each other from the "white list" of trusted partners. Both the countries also announced an end to their intelligence-sharing pact. 

What does it mean?
The two sides have different positions on numerous issues, that have become emotional over the years. 
The telephone interaction places hopes that Seoul and Tokyo will look for solutions, where the two countries would find a middle-ground to a constructive relationship. This can be seen as the primary move of Suga in trying to put things in order after taking office, by prioritizing the issues of the region and identifying the need to cooperate. 

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