Japan returns South Korea to preferred trade partner list after 4 years

SEOUL, June 27 (UPI) -- Japan will reinstate South Korea to its "white list" of preferred trade partners after a four-year absence, trade officials from both countries announced Tuesday in the latest sign of warming relations between the East Asian neighbors.

Japan's Ministry of Economy, Trade and Industry said the revised status, which will smooth export procedures for Japanese companies to South Korea, will take effect July 21.

Tokyo took Seoul off its list of preferred trading partners in July 2019, after South Korea's Supreme Court ordered Japanese companies to compensate Korean victims of wartime forced labor.

The move forced Japanese exporters to obtain licenses to ship a wide range of products to South Korea, from chemicals to advanced sensors and electronic components.

Relations began to improve after Seoul proposed a plan in March to compensate the victims through a public foundation without demanding contributions from Japan.

That month, South Korean President Yoon Suk-yeol and Japanese Prime Minister Fumio Kishida held a summit in Tokyo, during which the two leaders vowed to resolve lingering trade disputes and to restore "shuttle diplomacy" after years of the relationship having been frozen.

In April, South Korea returned Japan to its own list of preferred trading partners. A follow-up visit from Kishida to Seoul and a meeting between the two leaders at the Group of Seven summit in Hiroshima further solidified ties.

"Trust between the two countries in the field of export control has been completely restored," South Korea's Ministry of Transport, Industry and Energy said in a statement.

"Based on the improvement in ties, South Korea will continue to push for close cooperation with Japan on various bilateral and multilateral trade issues," the ministry said.

The thaw comes in the face of growing nuclear threats from North Korea and an increasingly assertive China.

Washington has long been pushing for closer cooperation among its allies, and trilateral defense and intelligence-sharing activities have ramped up over recent months. Yoon and Kishida are reportedly preparing for a trilateral meeting with U.S. President Joe Biden this summer.