Dependency on Japan for key materials dropped in 2021

Korea's dependency on Japanese materials and parts fell to an all-time low last year following Tokyo's control of exports of key products bound for Seoul, the industry ministry said Monday.

Imports of Japanese materials, parts and equipment came to $39.5 billion in 2021, accounting for 15.9 percent of Korea's overall purchase of those goods, according to the data from the industry and trade ministry.

The figure was down 1.3 percentage points from the previous year and the lowest since relevant data began to be compiled in 2001.

Of 100 key items, such as hydrogen fluoride, the rate of their imports from Japan fell to 24.9 percent last year from 30.9 percent in 2019, the ministry said.

In July 2019, Japan imposed export controls on chemicals vital to the Korean chip industry in apparent retaliation against a Seoul court's ruling the previous year that ordered Japanese firms to compensate victims of wartime forced labor.

Since the curbs, the Seoul government and local companies have ramped up efforts to boost the competitiveness of the sector.

Combined sales of listed Korean firms in this sector rose 20.8 percent during the first nine months of last year from the same period in 2019, the ministry said.

"The government will continue to extend support to the industries, which will also help us resolve such pending issues as supply chains and carbon neutrality," Industry Minister Moon Sung-wook said while visiting packaging material developer Youlchon Chemical.

Yonhap