Aug 1, 2019

South Koreans boycott Japan as trade tensions increase

President of South Korea Moon Jae-in (L) is welcomed by Japanese Prime Minister Shinzo Abe (R) on the first day of the G20 summit in Osaka, Japan on June 28, 2019. Photo: Metin Aktas/Anadolu Agency/Getty Images

A boycott of Japanese goods and services is picking up steam among South Koreans as trade tensions between the 2 countries continue to rise, reports AP.

Why it matters: The standoff began when Japan restricted exports of 3 chemicals used by South Korean tech manufacturers for semiconductors and display screens. That has hit chipmakers hard and angered South Koreans, some of whom have canceled trips to Japan or refused to buy Japanese products.

The big picture: Sales of Japanese consumer goods like beer have fallen sharply in South Korea, but the boycott is unlikely to have a deep effect on the Japanese economy, per AP. However, it's a sign of how hostile things have become and "may trigger a backlash from Japan."

  • "Tens of thousands of small supermarkets and convenience stores across South Korea have stopped selling Japanese beer and other products altogether," the AP reports.
  • "There have been anti-Japanese rallies in South Korea over the Japanese trade curbs, but none has yet turned violent. Two men in their 70s have set themselves on fire in an apparent protest against Japan."

Context: The underlying tensions date back to an ugly colonial history.

  • South Korea claims Japan's export restrictions are a reaction to court rulings last year ordering Japanese companies to pay compensation over forced labor during the 1940s.
  • Japan says it implemented the restrictions over national security concerns.

What's next: Japan could broaden its export restrictions and revoke South Korea's preferential trade status as early as Friday, according to AP.

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U.S. fails to stop South Korea from axing intelligence deal with Japan

Japan's PM Abe (L) and South Korea's President Moon at the 2017 APEC summit. Photo: Jorge Silva/AFP/Getty Images

South Korea plans to sever an intelligence-sharing agreement with Japan amid a crisis between the two key U.S. allies.

Why it matters: The Trump administration had urged South Korea not to take this step, which could hamper communication over the threat from North Korea. It came after Japan elected to slow exports of sensitive materials to South Korea on national security grounds, a move that provoked outrage and boycotts in South Korea. The bitter feud is linked to colonial-era abuses by Japan and looks unlikely to be resolved soon.

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North Korea claims it tested "super-large" multiple rocket launcher

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North Korean leader Kim Jong Un supervised the test-firing of a "newly developed super-large multiple rocket launcher," the country's state-run KCNA news agency reports.

Why it matters: This appears to be yet another demonstration of North Korea expanding its weapons arsenal apparently with the intention of increasing leverage ahead of the possible resumption of negotiations with the U.S. to denuclearize, as AP points out.

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Several of America's key strategic partners are at each other's throats — and the U.S. seems powerless to prevent further escalation.

Why it matters: “None of these crises were made in America,” says Richard Haass, president of the Council on Foreign Relations. “That said, we have made it worse in each case either by what we’ve done or what we haven’t done.”

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