On paper, they should be great allies.
Something like the Batman and Robin or Frodo and Sam of international politics.
Let me explain.
Japan and South Korea are relatively free countries in a geopolitical environment that
has some very unusual conditions.
They share partners, face the same threats and have strong economic ties.
Sounds like a pretty good match but here’s more...
We’re talking about two countries that have the same strategic ally: The United States,
which currently has a total of almost 80,000 soldiers deployed in Japan and Korea.
Virtually a full army.
In addition, both countries face the same challenges and the same threats, mainly an
aging population, as well as growing economic, political and military weight from both North
Korea and China.
And that's not all.
With bilateral trade that exceeds $80 billion per year and a transit of more than 10 million
tourists, Japan and South Korea’s economies are very interrelated.
So as you can see, they tick all the boxes to be very good friends.
What’s more, together, South Korea and Japan form a much stronger block than you could
imagine.
We’re talking about a block that has 177 million inhabitants;
a combined economy of more than 6.5 billion dollars;
an industrial production that doubles that of Germany and is 5 times that of France
And it has the third largest military budget on the entire planet, standing just behind
the United States and China.
Together, they spend more than $ 90 billion each year on defense.
In other words, if you had to work as consultants for these two governments, you’d surely
advise them to strengthen their ties and work side by side, right?
Well, folks, just a second because theory is one thing but the reality is something
altogether different.
The truth is that Japan and South Korea really don’t get along.
And that explains news stories like this:
(Naval incident causes a surge in tension between South Korea and Japan.
Military Zone)
(Forget North Korea: Is the Next Showdown in Asia Japan vs. South Korea?
The National Interest)
And now more than ever, this topic is a hot one.
Need proof?
Well check it out, according to a study conducted in July of 2019, no less than 74% of Japanese
people reported a distrust of South Koreans.
And apparently the feeling is mutual, 75% of South Koreans distrust Japanese.
But folks, of course, this doesn't end there.
At the beginning of July 2019, the Japanese government unleashed a sort of trade war against
South Korea.
More specifically, it restricted the exports of three key products to South Korean industry:
Fluorinated polyamide, hydrogen fluoride and photoprotectors.
Ok, you may have never heard of them but we’re talking about three chemicals that are essential
for manufacturing things such as semiconductors or smartphone screens.
And these are two components for which South Korea is one of the largest manufacturers
and exporters on the planet.
In fact, we could say that semiconductors are something like South Korea’s oil.
("South Korea is the world leader when it comes to chip-making, and Japan is the world
leader in the manufacturing of the key materials for chip-making," Ahn Ki-hyun, vice-president
of the Korea Semiconductor Industry Association.)
And no, it doesn't end there either.
At the beginning of August, Japan announced new restrictions... which may not be the last.
But, folks, before we continue, I think we need to ask ourselves some questions...
What exactly is going on?
Why did Japan unleash such a conflict with one of its biggest trading partners?
What consequences could it have?
Listen up.
(THE RECONCILIATION THAT NEVER ARRIVES)
To understand the entire story, we need to go back to the beginning of the 20th century.
From 1910 until the end of World War II in 1945, Korea was a Japanese colony.
These weren’t exactly happy years for the Koreans.
Folks, the Japanese Empire ruled Korea with an iron fist; there was a very, very tough
repression; huge amounts of crimes were committed and many lands were de facto expropriated.
To give you an idea, while the South Korean people went hungry, a lot of the agricultural
production was sent to Japan.
And there’s more.
During the Japanese occupation hundreds of thousands of South Koreans were forcibly recruited
to work in brutal semi-slavery conditions in Japanese industry and mines.
Stanford University estimates that this included more than 700,000 South Koreans.
But... if you think this is horrible, hold on, because things get even worse.
During World War II, tens and tens of thousands of South Korean women were forced to practice
the oldest trade in the world to “satisfy” Japanese soldiers.
It’s estimated that between 50,000 and 200,000 women were victims of this atrocity.
Folks, all this explains why 7, seven decades later, Japan and South Korea continue to fight
over what the occupation meant.
(“A local government near Seoul is calling for all Japanese-made school products to be
affixed with a sticker saying they were made by ‘war criminals”.
South China Morning Post.)
Of course, since South Korea regained its independence in 1945, there have been several
attempts to reconcile and turn the page.
The two most important ones happened in 1965 and in 2015.
And both had the same result.
You see, in 1965, when South Korea was a dictatorship led by Park Chung-hee, both countries agreed
to end all disputes.
Japan assumed its responsibility and promised to pay the South Korean government the equivalent
of 2.4 billion dollars as compensation and another 1.6 billion in low interest loans.
Everything sorted then?
Well, no.
In 2012, South Korea’s Supreme Court recognized the victim’s right to obtain individual
compensation.
And not from the Japanese government, but from the Japanese companies that were involved
in the forced labor cases.
The fact is that, in 2018, the South Korean Supreme Court’s ruling led companies such
as Nippon Steel, Mitsubishi Heavy Industries and the Nachi-Fujikoshi Corporation to pay
between 70,000 and 90,000 dollars to each of the two dozen victims who’d made a claim
before the courts...
And that’s where it all lies.
The ruling ordered compensation for the victims or their living relatives.
Because of course, some had already passed away.
And here lies the heart of the matter:
Can you imagine if the same happened with all the other forced workers, living or dead,
if their families could make a claim today?
We’d be talking about compensation amounting to billions of dollars which, of course, Japan
has no intention of paying,
Because, among other things, from their point of view, this whole issue had already been
resolved by the 1965 agreement.
On the other hand, in 2015 both governments agreed that Japan would create a fund of about
$9 million to compensate the women who were enslaved during World War II.
Well...
You know what?
This agreement was also worthless.
Why?
Listen up.
(THE BIGGER FIRE STRATEGY)
The South Korean economy isn’t going so well right now.
We’ve already talked about it here on VISUALPOLITIK, I’ll leave a video link in the description.
Folks, since Moon Jae-In came to power, things have been unraveling almost as fast as snapchat
photos disappear.
And, of course, the president's own popularity has followed closely behind the economy.
According to polls, President Moon Jae-In’s approval dropped from 83% in May 2018 to 45%
a year later.
And not only that, this is also a time when economic affairs are gaining more and more
power.
The South Korean leader's economic management plummeted down to 30%.
And…
Well, here’s a question: what do you do if you have a huge fire but you want people
to look the other way?
You make an even bigger fire.
I didn’t make that up, it’s one of the oldest tricks in politics.
Well that's exactly what Moon Jae-In seems to be doing: pouring gasoline on to the other
fire.
Which doesn’t seem to have been too hard, because, folks, since he reached power in
2017, Moon Jae-In has always been focused on Japan.
In fact, one of his first actions was to announce the unilateral and retroactive suspension
of the 2015 agreement.
And since then, tensions between the two countries have only grown.
Want some examples?
Well, check this out, in the last year we’ve witnessed increasingly controversial and almost
provocative political statements from the South Korean government against Japan.
South Korean intelligence has stopped sharing the information it has with Japan;
In December 2018, according to Japanese sources, a South Korean frigate set its shooting radar
on a Japanese plane.
Shortly after, Seoul prevented Japanese defense force ships from using its ports.
And even as recently as the beginning of 2019, we’ve seen a boycott on the purchase of
Japanese products which was instigated by the South Korean government itself.
Come on, if what he’s looking for is a fight, the South Korean president couldn’t be doing
a better job.
(“The bilateral relationship right now is about as bad as it has ever been, and it is
continuing to deteriorate”.
Ahn Yin-hay, professor of international relations at Korea University)
The point folks, is that it seems like Moon Jae-In didn’t think that Japan would respond
with such strength.
Or maybe he did?
(TRUMP OPENS THE DOOR, JAPAN WALKS RIGHT IN)
Donald Trump was a pioneer of this tactic: using commerce as a launching weapon in international
political negotiations.
Now Japan has gone one step further: they are using the trade war to punish an ally.
Japan has had enough.
And Shinzo Abe can’t deal with it anymore.
He thinks that the South Korean issue and all their pending quarrels have gone too far:
The 1965 agreement, the apologies of 1990, 1991, the 2015 agreement.
Tokyo isn’t willing to make any more concessions.
Of course, to be fair, the fact that the Prime Minister himself is a convinced revisionist
doesn't really help.
We also talked about that recently in another video.
The fact is that, at the beginning of July, the Japanese government decided to punish
Korea with the restrictions on the three components we mentioned before:
Fluorinated polyamide, hydrogen fluoride and photoprotectors.
We’re talking about a measure that, if not reversed soon, could cause great problems
for some South Korean giants like Samsung or SK Hynix, two of the world's largest semiconductor
manufacturers.
And that's not all.
At the beginning of August, the Japanese government communicated its decision to remove South
Korea from its white list of 27 countries that have preferential commercial status.
Basically the countries on this list can buy most Japanese technology and products freely
and without restrictions.
This means that to buy practically any product, except food and wood, South Korean companies
will have to comply with the Japanese government’s approval process, which not only involves
more bureaucracy and import costs, it also means that the Japanese government now has
the right end of the stick.
That is, they can veto any sale to South Korea at will.
And this, folks, is something that, given the deep commercial relations between the
two countries, could be a hard blow for Korea….
And not only for Korea, but also for Japan, which has a trade surplus with its neighbor
of more than 20 billion dollars.
The official excuse?
That South Korea can’t guarantee that all these product and technology exports with
possible military use won’t reach North Korea.
As an example, hydrogen fluoride isn’t only used in semiconductor production, it can also
be used for uranium enrichment or to manufacture sarin gas.
Although this sounds like quite an excuse.
Of course, the real reason is the endless controversy that surrounds this happy colonial
past.
(The Japanese accusations are very serious, but they have not provided evidence of any
collusion between South Korea and North Korea so far,” Céline Pajon, a Japan expert at
the French Institute for International Relations.)
Of course, at this point, folks, the question we have to ask is: does it make sense to resort
to commercial warfare as a foreign policy weapon?
Well, the truth is that experience and evidence say no.
You see, now the South Korean government isn’t only responding with its own sanctions, they’re
also putting a lot of money on the table to reduce their dependence on Japanese companies.
In a way, it’s similar to what happened with China in 2011.
Back then, the Chinese government restricted the sale of rare lands to Japan.
And what do you think the Japanese did?
They invested in their own mines.
In the end, China's market share decreased and Japanese taxpayers had to pay for it.
That is, the outcome was bad for everyone.
So yes.
This time, Shinzo Abe’s shot may backfire again.
Anyway, folks, what is most likely is that Japan and Korea will sooner or later return
to the starting point and continue this endless spiral of grievances.
But, you know what?
It’d be good for everyone to settle this matter once and for all.
It has been 70 years.
Enough, right?
(THE BLOC)
Folks, a close alliance between South Korea and Japan would frankly be a very good thing.
They would form an economic and political block with tons, tons of influence.
For example, they’d have a free trade agreement with China, which Japan and South Korea are
negotiating jointly.
Progress has slowed down now with Moon Jae-In but once it is settled it will create an even
wider arena for trade.
That would be good for everyone.
On a political level, they’d become a beacon in an area of ​​the world that is full
of dictatorships.
And at a military level, they’d be able to offset China’s weight.
Even with the army that the United States has deployed in these countries.
But of course, to achieve all this, it’s absolutely essential that both governments
reach an agreement to once and for all leave the past behind and focus on the future.
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