Japanese retailer posts net plunge in S. Korea amid trade row

December 26, 2019

The South Korean unit of Japanese conglomerate Fast Retailing Co. said Thursday its net profit fell 9.9 percent in the January-September period from a year earlier due to local sentiment against Japanese products.

The company, which sells Uniqlo and GU brand products, said in a regulatory filing that its net profit fell to 163.3 billion won (US$140 million) in the first nine months from 181.1 billion won in the same period the previous year.

Operating profit declined 15 percent to 199.4 billion won from 234.4 billion won. Sales rose 0.4 percent to 1.378 trillion won from 1.373 trillion won during the same period.

Local campaigns against Japanese products and travel to the neighboring country began in July when Japan tightened regulations on exports to South Korea of three high-tech materials crucial for the production of semiconductors and displays. In August, Japan officially removed South Korea from its list of countries given preferential treatment in trade procedures.

Japan’s moves are seen as retaliatory measures against Seoul court rulings that ordered Japanese companies to compensate South Korean workers forced into labor during World War II.

Moreover, a Uniqlo commercial triggered uproar among South Koreans in October and was suspended immediately.

It showed 98-year-old U.S. fashion guru Iris Apfel talking to 13-year-old fashion designer Kheris Rogers.

When Rogers asks how Apfel dressed when she was her age, the elderly celebrity responds, “Oh my God. I can’t remember that far back,” while a Korean subtitle read, “I can’t remember things that happened more than 80 years ago.”

While Uniqlo released a statement denying “any political motive,” the ad sparked criticism for its reference to the period when South Korea was under Japan’s 1910-45 colonial rule.