The Korea Herald

ssg
소아쌤

'No Japan?' Korea swings from extreme rejection to selective embrace

Weak yen, current administration's diplomacy factor into decline of 'No Japan' boycott

By No Kyung-min

Published : Oct. 2, 2023 - 16:01

    • Link copied

A shopper picks up a can of Japanese beer at a supermarket in Seoul, Sept. 18. (Yonhap) A shopper picks up a can of Japanese beer at a supermarket in Seoul, Sept. 18. (Yonhap)

For one local beer aficionado, the recent increase in the variety of alcoholic beverages available at convenience stores has been noticeable and -- to a moderate degree -- welcome.

"Various Japanese beer brands are now part of the 'Buy four cans of imported beer for 10,000 won ($7.50)' deal," 32-year-old Lee Hyun-soo told The Korea Herald.

"So I thought, 'Why not relish their rich flavor?' Especially since I haven't been to Japan in ages,” he said.

Marketed as the first canned beer product to offer a draft beer-like experience, Japanese beer Asahi Super Dry has also been selling out in Korea since its initial launch here in May. Slowly but surely, Japanese beers have started to make inroads into the Korean retail landscape once again after the "No Japan" boycott, which started in July 2019.

In a look at Korea Customs Service’s data from the past four years, as of July of each year, South Korea's imports of Japanese beer have witnessed many fluctuations, with import volumes at 774 and 522 metric tons in 2020 and 2021, respectively, in stark contrast to the 7,985 metric tons imported this year.

However, the rise in beer imports is not the sole indicator of a shift in Korean consumption patterns of Japanese products. The upsurge in engagement with other Japan-related economic activities is currently shifting the anti-Japan narrative.

A person walks past a Uniqlo store in Seoul, April 5. (Newsis) A person walks past a Uniqlo store in Seoul, April 5. (Newsis)

Rise and fall of the ‘No Japan’ boycott

The consumer-led nationwide boycott arose as a reaction to Japan’s imposition of trade sanctions on South Korea in July 2019.

Japan enforced curbs on exports of three high-tech materials critical for memory chips and displays to Korea. The following month, Japan removed Korea from its "white list" of preferred trading partners.

Regarding its export measures, the Japanese government cited national security concerns, but the curbs were widely perceived as retaliation for a 2018 decision by the Korean Supreme Court that ordered Japanese firms to compensate Korean victims of forced labor during the 1910-45 Japanese occupation of Korea. Tokyo argued that the forced labor issue was fully resolved through the 1965 Treaty on Basic Relations between the two nations, one being the former colonizer and the other its colony.

Amid the deteriorated diplomatic ties, tensions mounted between the two nations, resulting in Korea taking action to file a complaint with the World Trade Organization over the Japanese government's export controls and an anti-Japan boycott movement taking shape across the nation in 2019.

The hardest-hit products were Japanese consumer goods, including clothing, beer and cars.

Japanese apparel retailer Uniqlo was one of the most heavily boycotted companies, witnessing a dramatic sales drop in 2019 and 2020. According to annual earnings reports released by FRL Korea, the domestic distributor of Uniqlo, the fast-fashion brand logged revenue of about 1.4 trillion won from September 2017 to August 2018.

Yet, it dropped significantly to 97.4 billion in 2019 and further to 62.9 billion in 2020. Suffering operating losses in both of these years, Uniqlo opted to downsize, decreasing its number of stores here from 186 in 2019 to 126 in April 2023.

What further intensified and sustained the anti-Japanese sentiment was the influence of peer pressure among Koreans. A significant number hesitated to make any ostensible purchases of Japanese products during the fervent nationwide boycott.

"I refrained from visiting Japanese brand stores a few years ago because it didn't feel right at that time," shared Roh, a 30-something office worker. "I noticed a decline in customers at many stores, so I resorted to online purchases only in cases in which I truly needed something."

However, not all Japanese brands were adversely affected by the No Japan movement. In the realm of subcultures here, such as in gaming and anime, this behavior ignited debates about consumers' selective participation in the boycott.

For instance, in 2020, demand for the Japanese Nintendo Switch video game console surged, fueled by the release of the social simulation game “Animal Crossing: New Horizons.” The relaunch of SPC Samlip's Pokemon Bread last year, featuring collectible stickers of the Japanese anime characters, also triggered a nationwide buying frenzy.

This year saw Japanese films setting box office records, with animated films "The First Slam Dunk" and "Suzume" amassing over 4 million and 5 million in ticket sales, respectively. These two films placed second and first on the list of Japanese animated films with the highest ticket sales in Korea.

Some argue that the release of pent-up demand to go to cinemas following the lifting of COVID-19 social distancing measures and the waning of the pandemic was responsible.

However, the broad success of these films, along with other food and gaming trends, had already transcended being limited to specific subcultures, cultural fields or spaces alone.

Travelers wait in line at check-in counters in Incheon Airport, July 20. (Newsis) Travelers wait in line at check-in counters in Incheon Airport, July 20. (Newsis)

Weak yen, diplomacy turn the tide

While public sentiment toward Japan fluctuated as the boycott movement lost traction in uniting consumer attitudes, the recent jump in the number of Korean tourists to Japan marked a shift in the tide.

Since 2022, Japan emerged as an enticing tourist destination in the wake of the resumption of visa-free entry and lifted COVID-19 measures. This year, its allure was amplified by the favorable Korean won-Japanese yen exchange rates.

According to data from the Japan National Tourism Organization, in August, Japan welcomed around 21.5 million foreign tourists, with Korean nationals constituting the largest group, totaling 569,000. On a monthly basis, the number of Korean visitors to Japan peaked in July, with over 620,000 Koreans, marking an 111 percent increase compared to the same period in 2019.

“Japan's closeness to Korea and its devalued currency were major factors," 28-year-old Choi Yoon-ah told The Korea Herald when explaining her decision to visit Japan in July.

"I considered Jeju Island as an alternative, but there was little budget difference between either destination," she added.

In tandem with the surge in tourism to Japan, Japanese products have witnessed a growth in sales. This is evident in Uniqlo's recent upswing in operating profits, marking a 73 percent on-year increase at 134.8 million won in the fiscal year of 2022.

Moreover, data from the Korea Automobile Importers & Distributors Association reveals that during the first half of this year, Japanese automaker Toyota experienced a 38.9 percent on-year increase, selling 3,978 vehicles. Toyota's premium brand Lexus also demonstrated a boost in sales, recording a 121 percent on-year increase by selling 6,950 vehicles.

Koo Jeong-woo, sociology professor at Sungkyunkwan University, emphasized that these consumption behaviors are predominantly influenced by younger generations.

"The younger generations act as major consumers of Japan's products, and it is likely that their perceptions of Japan hinge on the current stance of the Korean government towards Japan," Koo stated.

Indeed, there has been a drastic change in the Korean government’s diplomacy regarding Japan over the past years.

After President Yoon Suk Yeol was sworn in in early 2022, Seoul chose to put past disputes behind for closer ties with Tokyo and sought to solidify the tripartite security partnership among Seoul, Washington and Tokyo to respond better to North Korea’s nuclear threats and China’s growing regional clout.

In March, the Yoon administration announced a plan to establish a state-run foundation to provide compensation to victims of forced labor, exempting their former Japanese employers from direct financial responsibility, despite the Korean top court’s order.

The same month, Seoul withdrew its WTO complaint against Tokyo's export restrictions. The following month, South Korea reinstated Japan to its white list, a decision made three years after its removal. In June, Japan reciprocated by re-designating South Korea as a white-listed “Group A” country, granting Seoul preferential export treatment and marking the end of the trade dispute.

Yet, the controversy surrounding Japan has persisted, with Tokyo moving to release treated wastewater from the crippled Fukushima nuclear power plant beginning last Aug. 24.

In this context, Lee Eun-hee, a professor of consumer studies at Inha University, stressed the need to respect individual choice.

“In times when the nation voices a variety of concerns about the Fukushima water issue, it is crucial not to exert influence on others’ decision-making processes,” Lee said.

For a male Korean surnamed Kang in his late 20s, Japan hangs in the balance. It evokes conflicting feelings.

“I am worried that seafood consumption in Japan might cause adverse effects on me,” Kang told The Herald. “Yet, it does not concern me to the extent of not visiting the country I regularly visit,” he added.

An office worker surnamed Lee in her 40s has never really supported either the vociferous, nationalism-charged No Japan boycott nor Japan's return to consumer favor here. However, the shift has left her feeling cynical.

"For me, it has always been about individual choices first. But witnessing those who criticized anything Japanese in the past now trying to capitalize on the yen's depreciation leaves me with a bitter feeling."

Members of environmental groups protest the Japanese government's decision to start releasing radioactive wastewater from the destroyed Fukushima Daiichi nuclear power plant into the ocean in front of Sejong Center for the Performing Arts in Seoul, Aug. 18. (Yonhap) Members of environmental groups protest the Japanese government's decision to start releasing radioactive wastewater from the destroyed Fukushima Daiichi nuclear power plant into the ocean in front of Sejong Center for the Performing Arts in Seoul, Aug. 18. (Yonhap)