As the Japanese government is moving to exclude South Korea from its trade whitelist, concerns are growing domestic biotech companies as it can disrupt the supply of biomedicine raw materials and equipment.
The Korea Biotechnology Industry Organization (KoreaBio) submitted a petition to Japan’s Ministry of Economy, Trade and Industry on July 24 requesting it to withdraw its move to exclude South Korea from the whitelist.
The Japanese ministry announced on July 1 that it would remove South Korea from the whitelist. The whitelist is a list of goods designated by the Japanese government whose export procedures will be simplified for friendly countries in terms of national security.
KoreaBio took action on behalf of its members as it believes that domestic bio companies will be weighed down if the Japanese ministry puts its plan into action.
If South Korea is excluded from Japan’s whitelist, Korean biotech companies should obtain a separate permit for each of the goods that they import. That will pose a significant burden on Korean importers, as the license screening period takes an average of more than 90 days and the procedure requires two times more documents, including the buyers’ pledge, contract papers and documents containing the information on buyer’s business contents. As a result, South Korean companies can experience delays in receipt of raw materials.
KoreaBio is concerned that trade restrictions may adversely affect drugs like vaccines that are being developed for peaceful purposes, as materials such as pathogens and toxins, and equipment including fermentation tanks and filters, could be subject to controls. If South Korean companies cannot secure Japanese products, they have to import products from other countries, including Germany.
South Korea exported US$497.48 million (586.93 billion won) worth of drugs to Japan and imported US$520.66 million (615.94 billion won) from it as of 2017, according to data from the Ministry of Food and Drug Safety. Exports grew 7.5 percent and imports 7.4 percent from a year ago.