Local economists assessed that should South Korea take counteraction against Japan's export restrictions, it would have a bigger impact on the local economy.

At a seminar held in Seoul on Wednesday, the Korea Economic Research Institute's(KERI) Cho Kyeong-lyeop estimated South Korea's gross domestic product(GDP) to drop two-point-two percent when Japanese imports of semiconductor materials fall 30 percent.

Japan's GDP, in contrast, would drop zero-point-04 percent.

If Seoul enforces countermeasures, the country's GDP would fall three-point-one percent, compared to Japan's one-point-eight percent decrease.

The decline for South Korea would further expand to four-point-two to five-point-four percent should local firms' material shortage rise to 45 percent.

Cho pointed out that the more retaliatory measures Seoul introduces, Japan's GDP drop will actually slow down since the market presence of South Korean firms in Japan can easily be taken over by Japanese or Chinese businesses.

The expert said the Seoul-Tokyo trade dispute will ultimately benefit China as it will be able to increase its production of goods in the electronics and electricity industries.