Business

Japan releases second batch of high-tech material to South Korea, sources say

Reuters, Kyodo

Japan has approved shipments of a high-tech material to South Korea for the second time since imposing export curbs last month, sources said Tuesday.

The move comes ahead of talks by government officials this week to resolve a dispute stemming from the neighbors’ wartime past. It also follows President Moon Jae-in’s apparent attempt last Thursday to bring about a thaw in their frozen ties.

“If Japan chooses the path of dialogue and cooperation, we will gladly join hands,” Moon said in a speech to mark the anniversary of Korea’s liberation from Japan’s 1910-1945 colonial rule.

In early July, Japan tightened controls on shipments to South Korea of three materials used in chips and displays, threatening to disrupt the global tech supply chain. Japan also announced a plan to remove South Korea’s fast-track export status from later this month.

The high-tech material cleared for Japan’s exports to Samsung Electronics Co. in South Korea is a chemical known as a photoresist, which is crucial for the tech giant’s advanced contract chipmaking production, the sources said Tuesday.

A Samsung Electronics spokeswoman and a South Korean trade ministry spokeswoman declined to comment. A Japanese official in charge of the issue was not available for comment.

An official at South Korea’s presidential office confirmed the exports at a briefing but said “uncertainties” will remain until Japan completely removes the tighter export controls it has instituted.

“Tokyo’s latest export approval is positive for the local industry, but I don’t see Japan’s move as a conciliatory message to South Korea,” another South Korean government official said, requesting anonymity because of the sensitivity of the matter.

Earlier this month, Japan gave the green light to the export of photoresist to Samsung Electronics for the first time since it imposed the restrictions.

Japan’s latest move comes ahead of a meeting between Foreign Minister Taro Kono and his South Korean counterpart, Kang Kyung-wha, in Beijing on Wednesday.

The two ministers will also meet this week with their Chinese counterpart, Wang Yi, in the first such trilateral gathering in three years, officials said.

“We will have to actively express our position, but it is a very difficult (situation),” Kang said at an airport in Seoul on Tuesday before leaving for Beijing.

Worsening bilateral ties are already taking a toll on other business areas, especially tourism. On Tuesday, major carrier Korean Air Lines Co. said it is reviewing the further suspension of its flights to Japan as the number of visitors to Japan has dropped significantly due to their thorny ties.

The company said in a statement that Busan-Osaka will be halted starting Sept. 16, while Incheon-Komatsu and Incheon-Kagoshima routes will be suspended from Sept. 29 to Nov. 16. and Incheon-Asahikawa from Sept. 29 to Oct. 26.

Ties between South Korea and Japan have sunk to their lowest level in years following Japan’s recent tightening of export rules to South Korea, which Seoul views as a retaliation of court rulings that ordered Japanese firms to compensate groups of South Koreans over the issue of wartime labor.