Japan restricts trade with South Korea for 5 months South Korean companies not seriously affected

Yonhap reported on November 24th that Japan had restricted the export of three key semiconductor materials to South Korea for nearly five months, and that production in the South Korean semiconductor and display industries had not been worse. According to south Korea’s Ministry of Industry, Commerce and Resources and related industries 24 news, Samsung Electronics,SK Hynix, Samsung Display, LG Display four South Korean companies reported to the government that since July, Japan issued trade restrictions, enterprise production has not been affected.

Japan restricts trade with South Korea for 5 months South Korean companies produce no poor pools

Reported that, at that time, because South Korea restricted the export of High Purity Of hydrogen fluoride, fluoropolylamide, photoresistors, three key semiconductor materials import dependence is very high, there are predictions that South Korean enterprises can not last three months will be completely stopped, but from the results, in addition to psychological anxiety has not caused a real impact.

The report mentioned that South Korean enterprises are using existing inventory to ensure normal production, the second is to import sources to Europe, while actively promoting the localization of raw materials, these are to break the difficulties play a role. In addition, after South Korea’s complaint to the WTO, Japan was under pressure from the international community to approve individual export projects, which also gave South Korean companies a breather.

According to reports, there are comments that Japan’s trade restrictions not only did not tie the hands and feet of South Korean enterprises, but to promote South Korea to achieve materials, components, equipment industry self-reliance. Late last year, when the Ministry of Industry published its 2019 work report, it proposed to strengthen the competitiveness of the materials, components and equipment industry as a core policy issue, but it was not paid attention at the time. Now, this has become a matter of national concern, but also let the implementation of relevant policies speed up. On the 21st of this month, the Law on Special Measures to Strengthen the Competitiveness of the Materials, Components and Equipment Industry was passed by the Standing Committee of the National Assembly.

However, Yonhap also noted that the industry believes that uncertainty remains for South Korean companies as Japan says individual approvals for three key materials and measures to remove South Korea from the export whitelist remain unchanged.

Reported that South Korean business people said that although so far production has not been affected, but can not guarantee that the future will not, hope that South Korea and Japan through the director-level dialogue on Japan’s trade restrictions to find solutions. South Korean government officials also said that even if Japan’s trade restrictions do not directly affect the production of South Korean enterprises, but also let South Korean enterprises in access to raw materials supply of the original unnecessary costs, which is a negative factor for South Korean companies.

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