Moon denounces Japan for 'unfair' economic retaliation

President Moon Jae-in speaks while presiding over a meeting with senior aides at Cheong Wa Dae in Seoul, Monday. Yonhap

By Lee Min-hyung

President Moon Jae-in spoke solemnly Monday, urging his top aides not to react emotionally to Japan's retaliatory actions, and instead focus on coming up with “long-term” steps to cope with the issue.

“We should never react sensitively to Japan's economic retaliation,” Moon said. “South Korea needs to take a long breath and control its temper to prepare for fundamental countermeasures against the move.”

Yet, he continued to stress the grave unfairness of Japan's economic retaliation. Moon had vowed to “never lose to Japan again” after Tokyo earlier this month stripped Korea of its preferred trading partner status.

“We cannot help taking the issue gravely, as Korea underwent a great deal of pain due to Japanese imperialism in the past,” Moon said in a meeting with senior aides, Monday, according to Cheong Wa Dae press pool reports.

The Tokyo-driven economic retaliation is an unjust act in itself, all the more so because the decision resulted from a historical conflict, according to Moon.

The escalating trade friction started early last month when Japan imposed export restrictions to South Korea on some chemical materials in use for manufacturing chips and display panels. The South Korean government expressed deep regret and tech companies have since had to find other supply sources to produce high-tech products.

Earlier this month, Japan announced an additional restrictive measure by removing Seoul from the whitelist of countries receiving trade benefits.

As of now, Seoul has failed to find any concrete breakthrough to end the deepening feud with Tokyo.

President Moon called on the public as well as the economic sectors here to tighten internal unity to overcome the issue.

“The South Korean public has shown a mature sense of civic consciousness (after the trade dispute erupted) by displaying a determined attitude against the Japanese government's economic retaliation,” Moon said.

The remark came three days before the Aug. 15 National Liberation Day which symbolizes the end of Japan's 1910-45 colonial rule.

Expectations are that President Moon will highlight the message on the issue when delivering a congratulatory address on the day.

“The South Korean government will carry out an economic strategy in a detailed and sophisticated manner by regarding the economic retaliation as a chance of a blessing in disguise,” Moon said.

The intensifying political and economic feud started amid their lingering differences in views on the South Korean Supreme Court's ruling last year ordering Japanese companies to compensate surviving South Korean victims of wartime forced labor.

Seoul and Tokyo remain poles apart in settling the issue amid Japan's fierce opposition to the ruling.

To find a middle ground, the South Korean government offered to set up a joint fund between companies from the two countries. But with Japan flatly denying the proposal, the bilateral negotiation for earlier settlement of the issue has gone back to square one.

Currently, both countries remain poles apart, and no concrete breakthroughs are expected if the status quo continues.

On Monday, Cheong Wa Dae denied a Japanese report that claimed the U.S. backs up Japan's argument on the 1965 treaty between South Korea and Japan. Under the treaty, Tokyo provided Seoul with a $300 million grant and $200 million in loans.

Japan is arguing any compensation issues regarding the colonial era between South Korea and Japan were settled through the treaty. But Seoul argues the treaty does not include detailed agreements on compensation for individual victims.

Citing a Japanese government official, Mainichi Shimbun reported that the U.S. State Department expressed its position to support Japanese claims on the historical dispute.

“South Korea and the U.S. are communicating with each other in real time,” Cheong Wa Dae spokesperson Ko Min-jung said. “We have checked whether the report is true on a level of the National Security Council, and received a reply (from the U.S.) that says the report is far from the truth.”