Japan-South Korea disputes will reshape supply chains
Friday, October 11, 2019
Significance
The two countries have imposed mutual export controls this year amid a dispute over reparations for damage inflicted by Japan during the Second World War. Their confrontation introduces further uncertainty into the global web of supplier relationships already upset by the China-US trade war and other US trade policies.
Impacts
- Business opportunities will arise as South Korean companies, assisted by their government, seek alternative suppliers at home and abroad.
- South Korean state investment to develop sources at home could eventually bring new competition to Japanese suppliers overseas too.
- Japan’s willingness to use trade policy for unrelated political goals sets a precedent that others may follow.