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| Korea-Japan Economic Association Chairman Kim Yoon, left, shakes hands with Japan-Korea Economic Association Chairman Mikio Sasaki after adopting a joint statement during the 50th meeting between the two groups in Tokyo in this file photo from May 16, 2018. Courtesy of Korea Japan Economic Association |
By Nam Hyun-woo
A Japanese business group's decision to postpone planned business talks with its Korean counterpart is raising eyebrows among businesspeople here who stress the importance of private sector exchanges in the face of deteriorating bilateral diplomatic relations.
The Korea-Japan Economic Association (KJE) said the annual meeting with its Japanese counterpart, the Japan-Korea Economic Association (JKE), has been pushed back until after September.
This year's meeting was initially scheduled to take place May 13 in Seoul. However, a KJE official said the two associations' chairmen met recently and decided to postpone the annual event due to "chilly diplomatic relations between the two countries."
The official refused to say which side proposed the postponement, but according to industry analysts, it was the JKE that sought to put off the meeting.
"We cannot say which side first mentioned the need to postpone the annual gathering, but the two associations' chairmen agreed to do so due to the current diplomatic relations, and we have sent notices to our members," the official said. He added the two associations' working level officials are discussing how to hold the meeting under whatever circumstances.
The analysts said the suspension is a major sign of aggravated business sentiment and deteriorating economic cooperation between Korea and Japan, because the meeting has delivered multiple sizable investments in the two countries.
In its 51-year history, the meeting has been delayed only a few times, such as when Japan was hit by the 2011 Tohoku earthquake and tsunami, and when Korea was electing President Moon Jae-in in an out-of-schedule election in May 2017.
"A similar meeting between the chambers of commerce of Korea and Japan was canceled late last year, due to the Japanese side's request to put political and diplomatic issues on the table," an official at a major business association said. "It seems the KJE meeting has also been suspended due to the Japanese side's demands."
In November, Korea's Supreme Court ruled against Japan's Mitsubishi Heavy Industries in two private lawsuits, ordering it to compensate 10 Koreans who worked at its factories in 1944 with no pay, and a bereaved family member of another.
The court upheld two appellate court judgments; one ordering Mitsubishi to disburse between 100 million won ($89,000) and 120 million won to each of four female victims and the relative, and the other that ordered it to pay 80 million won each to six elderly men.
After Mitsubishi refused to pay, the victims filed a suit with a Seoul low court to confiscate the company's assets. The Japanese government is reportedly considering hiking tariffs on imports from Korea if the court rules in favor of the confiscation order, according to Jiji Press.
JKE Chairman Mikio Sasaki is chairman of the board at Mitsubishi Corp.
Also, it is reported that Japan's Liberal Democratic Party is considering seeking a ban on hydrogen fluoride exports to Korea, as part of the economic retaliation. Hydrogen fluoride is a core material for semiconductors, a main export product of Korea.
"Though it seems not many Korean firms having business dealings with Japanese companies are expressing concern currently, if Japan retaliates economically, there will be confusion among large and small firms, given the two countries' trade volume," the company official said.
The trade volume between Korea and Japan last year stood at $85.19 billion, according to the Korea International Trade Association.
