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Japan approves removing South Korea from preferred trade status

Published: Updated:

Japan has approved the removal of South Korea from a “whitelist” of countries with preferential trade status, escalating tensions between the neighbors.

Friday’s Cabinet decision expanding controls over exports of sensitive materials takes effect on Aug. 28.

It follows an earlier requirement that Japanese companies’ exports to South Korea be approved on a case-by-case basis for three materials used in semiconductors, smartphones and other high-tech devices.

The decision will fuel antagonism between the two neighbors already at a boiling point over the export controls and the issue of compensation for wartime Korean laborers.

It will ripple across the high-tech sector, further affecting supply chains already rattled by US-China trade tensions.