Chapter 377 |
Following Prime Minister Okazaki's announcement, Japanese right-wing groups showed signs of mobilizing. Protests denouncing South Korea were held in various places, and claims of sovereignty over Dokdo also intensified.
Japan's sanctions immediately led to visible economic losses. Stock prices of companies heavily reliant on trade with Japan plummeted, and the exchange rate soared.
Japanese companies also anticipated export disruptions, and their stock prices fell slightly after the sanctions announcement. On the other hand, the approval ratings for the Japan Innovation Party, the Liberal Democratic Party, and Prime Minister Okazaki rose sharply.
While the South Korean government did not issue a particular stance, the opposition party moved first. The Free People's Party expressed serious concern, and leader Yeon Nakyeong took the lead in attacking the government.
"The Heo Chang-min administration is unnecessarily provoking Japan. The Heo Chang-min administration, which is ruining Korea-Japan relations, must reflect on its actions."
Leader Yeon Nakyeong's pro-Japanese actions had been well-known since her days as a first-term lawmaker. Her attendance at the Self-Defense Forces' founding anniversary celebration and her insistence during the Nishida Securities incident that the South Korean government should strive for compensation were typical examples.
But this time, she went even further.
"If Japan restricts exports, all our companies will die, and the Korean economy will collapse. The government must fully understand Japan's position and establish measures to normalize relations."
Public opinion was divided.
- "According to her, has Japan been keeping Korea alive all this time?"
- "This is all Heo Chang-min's fault! The Heo Chang-min administration has ruined Korea-Japan relations!"
- "They ruined the relationship, so why do we have to come up with countermeasures?"
- "We need to throw pro-North leftist Kang Jin-hoo in jail first!"
- "We should call her Yeon-kazaki, not Yeon Nakyeong."
- "Isn't she just a local collaborator with the Japanese?"
- "Who the hell elected her as party leader?"
- "Seriously, we elected her to be a conservative opposition, what's with this pro-Japanese act?"
- "At least she has some sense, she's only criticizing the government, not Kang Jin-hoo lol."
- "If you're conservative, act like a conservative and stick to that. Please, go easy on the pro-Japanese stuff~"
- "Leader Yeon Nakyeong isn't wrong, I don't know why people are like this. Don't they know Korean companies rely on Japan for core components? Just you wait. The economy will collapse, and everyone will end up blaming the government and Kang Jin-hoo."
- "That's right! Cooperation with Japan is the only way for Korea to survive!"
- "Japan is a grateful nation. We are always thankful ^^"
- "We support Leader Yeon Nakyeong!"
Taek-gyu said while watching the news, "If Japan really imposes sanctions, will all Korean companies go bankrupt?"
"There's no such thing as a one-sided benevolent relationship in international trade."
We can buy bread not because of the baker's benevolence, but because he seeks profit.
Similarly, Japanese companies exported materials and parts to Korea not to save Korean companies, but because it was profitable for them.
If Korean companies truly couldn't survive without Japan, they would have charged exorbitant prices from the start.
"Trade happens because it's mutually beneficial."
It's impossible to achieve a 100% balanced trade. If one side has a surplus, the other inevitably has a deficit.
However, that doesn't mean the side with the deficit is unilaterally losing. If you import a product for 50,000 won that would cost 100,000 won to make yourself, you've actually gained 50,000 won.
Korean companies will be hit immediately by the sanctions, but as time goes on, Japanese companies' losses will also grow.
This is a battle of who can endure more losses.
The rhetoric from the Japan Innovation Party and right-wing groups grew stronger. Slogans calling to "reclaim Takeshima" (Dokdo) were frequently heard.
In the current international order, it's virtually impossible to seize territory effectively occupied by another country.
Even if South Korea's national power declined significantly, making it possible for Japan to take Dokdo, it would be difficult to do so in reality.
This is because, from Japan's perspective, the losses from seizing Dokdo would far outweigh the gains. Of course, since that possibility cannot be completely ruled out, we must thoroughly prepare for provocations. The military exists to prevent unlikely events from happening.
"Actually, from Japan's perspective, Dokdo is just one of several territorial disputes. To boost approval ratings, highlighting the Senkaku Islands or Kuril Islands issues would be more effective than Dokdo."
"Then why do they always pick on Dokdo?"
"Would you want to provoke China and Russia?"
China and Russia are bully nations feared by the whole world, except perhaps the United States.
It's like a neighborhood thug who can't say a word to gangsters but grabs and shakes the collar of a powerless commoner.
Everyone loves justice, but relations between countries are moved by power, not justice.
The war-criminal nations that started world wars and invaded neighboring countries are still doing well today, while the victimized nations that were colonized are still groaning in pain.
There are even countries asking for aid from the aggressor nations that once ruled them. If South Korea hadn't achieved economic growth, it would still be asking Japan for help.
Whether it's a country or a company, if you have power, you can speak loudly; if you don't, you get pushed around.
Taek-gyu crossed his arms and said, "So this is what the sorrow of the powerless feels like."
Realistically, it's impossible for South Korea to surpass Japan's economic power. Even if South Korea grows further and its per capita GDP becomes the same as Japan's, Japan's population is more than twice as large.
Therefore, Japan has generally always had greater national power than South Korea.
For their economic power to reverse, South Korea's per capita GDP would have to exceed $100,000, or conversely, Japan's per capita GDP would have to fall below $30,000, which is realistically difficult.
However…
"At least we shouldn't let them see us as a pushover."
Just making it clear that there's nothing to gain by provoking us would significantly change Japan's attitude.
***
Less than a day after Prime Minister Okazaki announced the sanctions, Foreign Minister Kim Seong-cheol visited the company.
Although it might not seem like a big deal since I've been meeting and contacting leaders frequently lately, it's rare for a Foreign Minister to visit a businessman like this.
"Nice to meet you, CEO Kang Jin-hoo. I'm Foreign Minister Kim Seong-cheol."
"Hello."
The Foreign Minister is a key position among key government posts. His career is impressive. He received his doctorate from Yale and worked at the UN.
There are suspicions that he got his nephew unfairly accepted into a special recruitment for a Ministry of Foreign Affairs officer... but well, that's probably not important.
Minister Kim Seong-cheol said with a smile, "I also graduated from Korea University's business administration department. So I've always felt a connection with you, CEO Kang Jin-hoo."
Taek-gyu, who was next to me, patted my shoulder. "You're lucky. You have so many seniors in politics and business. Why are there so many Korea University graduates in the world?"
Perhaps taking it as a hint not to flaunt school ties, Minister Kim Seong-cheol looked slightly embarrassed.
For the record, I'm not fond of school, regional, or blood ties either.
We sat in the meeting room. "What brings you here?"
"I'd like to hear your opinion, CEO Kang Jin-hoo, regarding Korea-Japan relations."
"Is my opinion important for government affairs?"
"You're probably aware that there are various issues between Korea and Japan. Our Ministry of Foreign Affairs is currently discussing future directions by synthesizing diverse opinions from various sectors."
"I'm not sure what you're trying to say."
The language of politicians and diplomats is different.
Because a trivial thing can cause misunderstandings and nitpicking from other countries, they tend to be cautious with every word and particle, often beating around the bush with non-committal language.
"Please don't beat around the bush; speak directly. Nothing said here will leak out."
At my words, Minister Kim Seong-cheol looked as if he had made a decision.
"Alright. To be frank, the government's position is extremely difficult. It's not just difficult; the Blue House and all ministries are in a state of emergency. And all the arrows of blame are being directed at the Ministry of Foreign Affairs. Relations with Japan are now heading beyond a cooling-off period towards a catastrophe. I'm going crazy wondering why you keep escalating things like this."
Taek-gyu said in a low voice, "This is a bit too frank."
"…"
It seems he had a lot pent up against me.
Well, it's not that I don't understand. I am a bit different from other businessmen who faithfully follow government policy.
I asked him back, "What is the government's stance on the forced labor compensation ruling?"
During the Japanese colonial era, Japanese companies forcibly took Koreans for labor and did not pay them properly. The victims sued for compensation and unpaid wages, but ultimately lost in Japan. The victims then sued again in Korean courts. The Park Si-hyeong administration, which highly valued Korea-Japan relations, pressured the judiciary to delay the ruling. In the meantime, three of the four plaintiffs died from illness and old age. Had it been delayed further, all plaintiffs might have died. However, after the regime change, the trial resumed, and the Korean Supreme Court ruled that Japanese companies must pay 100 million won per person in compensation. It's hard to deny the fact of forced labor itself. So, Japan argued that compensation was already settled according to the Korea-Japan Claims Agreement. Korea's stance is that individual claims were not included in that.
"Our stance is to proceed according to principle, following the judiciary's ruling."
Actually, the amount itself isn't a big issue.
How much money is it really? The company involved was originally willing to compensate. However, the Japanese government instructed them not to, and they decided against compensation following their home government's policy.
As a result, South Korea announced it would seize their assets in Korea according to the Supreme Court ruling, and Japan is protesting this.
"It seems Japan intends to take this to an arbitration committee."
"We haven't agreed, but we are considering that point."
An arbitration committee involves one member each from Korea and Japan, and one from a third country to mediate. It sounds fair at first glance, but there's a problem. Japan is the world's third-largest economy and exerts influence over various countries. Even if it's a third party, if there's a strong side and a weak side, whose side would they take?
"Japan is also very uncomfortable with this issue. If mishandled, it could appear as an admission of various war crimes, including forced labor."
Japan wants to erase its image as a war-criminal nation in the international community. That's why they react so strongly when the comfort women and forced labor issues flare up.
"There were disagreements on how to resolve it, but we were conducting negotiations behind the scenes..."
"Are you saying I ruined the plan?"
After a moment's hesitation, Minister Kim Seong-cheol nodded as if sighing. "Yes."
"I broke it on purpose."
He looked at me with an expression of disbelief. "You knew and still did it?"
"The comfort women agreement, the forced labor compensation ruling, and the Nishida Securities incident. Japan is using these to boost approval ratings domestically. Even in this case, if compensation is obtained through seizure, wouldn't Japan maintain the stance that they didn't compensate willingly but that Korea forcibly extracted it, and then pressure Korea whenever they feel like it? Compensation must be preceded by an apology; otherwise, it's meaningless."
When the two countries first announced the comfort women agreement, many opinions said it was well done. But what happened? After receiving the 1 billion yen, Japan's attitude changed completely. They continued to deny the forced mobilization of comfort women and war crimes, and pressured the Korean government to remove the comfort woman statue and implement the agreement. It was like the guilty party raising their voice just because they paid some money. Eventually, the agreement was annulled, and Korea-Japan relations worsened even more than before the agreement. There's no guarantee that a similar situation won't repeat with this forced labor compensation issue.
"So, it's better to tie things up definitively before moving on."
"That's easier said than done. The government's position is very difficult right now. The economy is volatile, the opposition is on the offensive, and the public is very worried."
Taek-gyu said, "The approval ratings are plummeting."
He couldn't deny it and wore a bitter expression.
"Even if it's difficult now, if the outcome is good, all's well that ends well. If this matter concludes well, won't it be a blessing in disguise?"
Did he think he had a card to turn this situation around?
Minister Kim Seong-cheol's eyes gleamed as he cautiously asked, "CEO Kang Jin-hoo, what do you think the government should do?"
If the Korean government proceeds with asset seizure by presenting the court ruling, relations with Japan will hit rock bottom. But with Japan having made the first move, they can't just sit idly by.
How difficult must it have been to make a decision for him to come to me?
I said, as if it were obvious, "Just follow the principles."
Meaning, proceed with the asset seizure.
"Then what about relations with Japan?"
No matter what, Japan is an important partner for South Korea, both economically and in terms of security. They can't drag out this cold state indefinitely.
"Of course, you have to resolve it well."
I added one more thing. "Isn't it usually the one who needs it more who bows their head first?"