{"id":2203675,"date":"2024-01-30T17:44:38","date_gmt":"2024-01-30T08:44:38","guid":{"rendered":"https:\/\/koreapro.org\/?p=2203675"},"modified":"2024-01-31T19:37:27","modified_gmt":"2024-01-31T10:37:27","slug":"why-south-korea-dropping-anti-dumping-measures-reflects-its-changing-priorities","status":"publish","type":"post","link":"https:\/\/koreapro.org\/2024\/01\/why-south-korea-dropping-anti-dumping-measures-reflects-its-changing-priorities\/","title":{"rendered":"Why South Korea dropping anti-dumping measures reflects its changing priorities"},"content":{"rendered":"
In a move that signals a turning point in Seoul\u2019s economic strategy, the <\/span>expiration<\/span><\/a> of South Korea\u2019s anti-dumping duties on stainless-steel bars from Japan, India and Spain on Jan. 22 parallels the end of similar duties on Taiwanese and Italian imports in May.<\/span><\/p>\n The Korea Trade Commission of the Ministry of Trade, Industry and Energy highlighted <\/span>three reasons<\/span><\/a> for this change: the absence of a renewal request from the Korean steel industry, a substantial reduction in Japanese steel imports and the regained competitiveness of the domestic steel industry.<\/span><\/p>\n However, this move is not without risks. Moving away from a two-decade-long practice of employing anti-dumping tariffs signifies South Korea\u2019s adaptation to an evolving global economic landscape, but it also opens the door to potential challenges.<\/span><\/p>\n As the country shifts its focus toward exporting advanced technologies, it faces crucial questions about how its domestic industries will fare amid increasing global competition and a rising trend of trade protectionism. This policy change highlights the need for South Korea to carefully weigh the immediate advantages for its technology sectors against the need for long-term stability and growth of its wider industrial base.<\/span><\/p>\n TRADE PROTECTIONISM BY ANOTHER NAME<\/b>\u00a0<\/span><\/p>\n Japan\u2019s perspective on South Korea\u2019s trade defense strategies has been notably consistent, albeit critical. According to Japan, South Korea\u2019s application of anti-dumping duties on stainless-steel bars has not always aligned with the principles set by international legal frameworks, specifically those of the World Trade Organization (WTO).<\/span><\/p>\n Japan argues that South Korea\u2019s approach, rather than safeguarding its domestic industry from economic harm as intended by <\/span>WTO guidelines<\/span><\/a>, has veered toward trade protectionism.<\/span><\/p>\n Governments typically utilize anti-dumping measures to neutralize unfair cost advantages that foreign producers might gain, for instance, through government subsidies, allowing them to undercut prices in the importing country. However, determining which governmental interventions are permissible under WTO rules can be complex, with a range of possible exceptions based on public interest considerations.<\/span><\/p>\n The WTO generally limits anti-dumping measures to five years, <\/span>subject to extension<\/span><\/a> if there\u2019s a risk of continued or recurring unfair trade practices. Perceiving such a risk, South Korea has <\/span>maintained anti-dumping duties<\/span><\/a> on stainless-steel bars from Japan, India and Spain since 2004, with subsequent legislation in 2017 and 2021 extending these duties to Jan. 22.<\/span><\/p>\n This extension led Japan to <\/span>request a WTO investigation<\/span><\/a> in 2018, questioning whether South Korea\u2019s extension beyond the standard five-year period complied with WTO rules. The investigation escalated into a formal trade dispute, with Japan asserting that South Korea\u2019s trade remedies were explicitly designed to target Japanese products.<\/span><\/p>\n This stance aligns with the position of Japan\u2019s Ministry of Economy, Trade and Industry, which views such measures as politically motivated rather than based on legitimate trade concerns, <\/span>drawing parallels<\/span><\/a> with past instances involving semiconductors, dried laver and products from Fukushima.<\/span><\/p>\n In 2020, a WTO Dispute Settlement Body panel largely concurred with Japan, finding biases in South Korea\u2019s sunset review methodology. South Korea appealed this decision to the WTO\u2019s Appellate Body, the highest authority for trade disputes.<\/span><\/p>\n However, the Appellate Body\u2019s operations were halted in 2019 following the U.S. decision to <\/span>block the appointment of new judges<\/span><\/a>, leaving South Korea\u2019s appeal unresolved. Despite the expiration of the contested anti-dumping measures, the outcome of this appeal remains crucial for determining the legitimacy of South Korea\u2019s trade defense practices within the framework of international trade law.<\/span><\/p>\n