IEEJ：November 2019○ｃIEEJ 2019
Special Bulletin
A Japanese Perspective on the International Energy Landscape (453)November 8, 2019

Significance of IEEJ-KEEI Joint Workshop
Ken Koyama, PhD
Chief Economist, Managing Director
The Institute of Energy Economics, JapanOn November 7, a joint workshop between the Institute of Energy Economics, Japan, andthe Korea Energy Economics Institute took place in Kamakura, Japan. The representative Japaneseand South Korean energy research organizations have held the annual joint workshop alternately inJapan and South Korea to discuss the contemporary international energy situation regarding the twocountries and their energy policy challenges to pursue the significance and potential of bilateralenergy cooperation. IEEJ Chairman Masakazu Toyoda, KEEI President Cho Yong Sung andresearchers from the two institutes participated in the workshop for active discussions.
The latest workshop consisted of a morning session on geopolitical risks in theinternational energy situation regarding the two countries and two afternoon sessions on liquefied
natural gas and renewable energy as matters of common interest to the countries. I took part in themorning session alone as its moderator before attending a symposium to mark the 10th anniversaryof the International Research Center of Advanced Energy Systems for Sustainability at the Tokyo
Institute of Technology. Although I failed to cover the whole of the workshop, I would like to discuss
the significance of the IEEJ-KEEI joint workshop that I felt through the morning session.
Japan and South Korea have many similarities and affinities regarding the energy supply
and demand structure, resource endowment and energy policy challenges. They are industrial trading
countries belonging to the Organization for Economic Cooperation and Development and theInternational Energy Agency. The two countries are among the world’s leading energy consumers,depending on fossil fuels such as oil, natural gas and coal for most of their energy supply. However,they are endowed with little fossil energy resources, featuring their very heavy dependence onenergy imports. As for oil as the largest energy source, the two countries depend highly on theMiddle East. Japan and South Korea have remained major LNG importers. Before China became thesecond largest LNG importer in 2017, Japan and South Korea were the world’s first and second
largest LNG importers.
The two countries have given priority to nuclear energy for energy security and climatechange prevention and are plagued with great nuclear policy challenges. They place great hopes on
renewable energy while facing high supply costs and constraints on renewable energy endowment.
While Japan is nominally an isolated island nation, some South Korean experts argue that theircountry even at the edge of the Korean peninsula has effectively been isolated due to the presence ofNorth Korea. Japan and South Korea thus have many similarities and affinities regarding energy.
Against such background, Japan and South Korea have historically shared challenges
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emerging from their common energy supply and demand structure and discussed their potential
energy cooperation to address those challenges. In my career as a researcher over the past more than
30 years, I have frequently participated in talks on Japan-South Korea energy cooperation, based ona belief that energy cooperation would contribute to resolving their common challenges to theadvantage of both countries. As a matter of course, their cooperation in energy and other areas cangenerally stabilize and enhance their relations.
As is well known, however, the present Japan-South Korea relations are very difficult. Thebilateral relations have been described even as the worst since the end of World War II. It is a factthat Japan and South Korea have always had various problems. However, some recent developments
have accelerated the deterioration of bilateral relations, driving the relations to the worst phase sincethe war.
The issue of wartime Korean workers in Japan, the South Korean Navy’s locking offire-control radar on Japanese patrol aircraft, Japan’s correction of controls on exports to South
Korea and the latter’s retaliation, and Seoul’s offer to abolish the bilateral General Security of
Military Information Agreement, know as GSOMIA, have spread the deterioration of bilateralrelations to cover political, economic and security areas. Particularly, if things remain unchanged,
the GSOMIA pact is set to lose its effect on November 23. The United States, an ally for both Japanand South Korea, has demonstrated strong concern about such consequence. At present, however,neither Tokyo nor Seoul indicates any initiative to reach compromise or make a breakthrough.
Under such situation, private-sector, grass-root and other various exchanges between thetwo countries have declined. Everyone has been discouraged from loudly calling for enhancing
bilateral cooperation. However, this situation is undesirable for both countries.
Therefore, it is significant for the IEEJ and KEEI to have held the joint workshop with
their top leaders attending and frankly and robustly discussed bilateral energy cooperation. As thesession in which I participated focused on the international energy situation and geopolitical risks,participants discussed the present statuses and possible future courses of the Middle Eastern situation,
the U.S.-China trade war and other issues, and relevant challenges and cooperative initiatives thatJapan and South Korea should tackle. It was pointed out that Japan and South Korea as IEA
members should promote cooperation in enhancing Asian energy security in response to growing
geopolitical risks and destabilization in the Middle East at a time when Asia’s dependence on energy
imports from the Middle East is expected to increase. It was impressive that participants positively
discussed potential bilateral cooperation in diversifying Middle Eastern oil-producing economies fortheir stabilization and what to do to that end.
At a time when political relations have been soured with serious disputes existing between
Japan and South Korea, it is not easy for them to go ahead with energy cooperation even if they havecommon energy challenges. However, I remember that I participated in developing future scenarios
for energy cooperation in Northeast Asia among Japanese, Chinese and South Korean energy
stakeholders when Japan-China relations were very soured in the early 2000s. I then emphasized thepotential and significance of cooperation particularly in energy conservation. When Japan-China
relations began to improve later, cooperation in energy conservation played a key role. Two2

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countries’ energy relations form only a small part of overall bilateral political, economic and security
relations. If the two countries are to explore meaningful cooperation in some areas, however, theircooperation in tackling their common energy challenges may play a role. It would be significant forJapan and South Korea to seriously explore and pursue bilateral energy cooperation while coolly
watching their overall relations.

Contact: report@tky.ieej.or.jp
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