S Korea to announce measures to settle wartime labor rift with Japan

by Mar 6, 2023Featured Article, News

The South Korean government plans to formally announce measures to settle a wartime labor compensation dispute with Japan on Monday morning, diplomatic sources said Sunday, a move that could pave the way for bilateral relations to emerge from the doldrums.

Seoul has been considering providing compensation payments to former Korean laborers through a government-backed South Korean foundation, instead of requiring Japanese companies to pay damages as ordered by South Korean court rulings.

The latest development comes as relations between Tokyo and Seoul have shown signs of improvement after President Yoon Suk Yeol took office in South Korea in May last year with a pledge to take a future-oriented approach toward Japan.

While South Korea was under the government of Yoon’s predecessor Moon Jae In, bilateral ties sunk to their lowest point in years over wartime labor and other issues stemming largely from Japan’s 1910-1945 colonization of the Korean Peninsula.

South Korea’s Supreme Court in 2018 ordered steelmaker Nippon Steel Corp and machinery manufacturer Mitsubishi Heavy Industries Ltd to compensate Korean plaintiffs for forced labor during World War II.

The companies refused to comply as the Japanese government views all issues between the two peoples stemming from its colonial rule as settled under a 1965 bilateral deal that included $500 million “economic cooperation” loans and grants to Seoul.

But the plaintiffs’ move to liquidate the companies’ seized assets in South Korea to get compensation and the approval by local courts of such a move heightened concerns in Tokyo over possible repercussions, propelling Seoul to look for an alternative solution.

If Seoul decides to ensure a compensation payment to former laborers through the foundation, the Japanese government will allow Japanese firms to voluntarily provide donations to it, a diplomatic source has said earlier.

The Japanese government is also expected to express remorse to former Korean laborers, in line with past government statements over Japan’s wartime aggression in Asia, and lift restrictions on certain tech exports to South Korea, according to the source.

South Korean media are reporting that Seoul is also expected to announce on Monday the setting up of a “future youth fund” by the Federation of Korean Industries, a major South Korean business lobby, and its Japanese equivalent Keidanren to sponsor scholarships for students.

Both Nippon Steel and Mitsubishi Heavy are members of Keidanren, known formally as the Japan Business Federation.

South Korean National Security Adviser Kim Sung Han told reporters on Sunday that “future generations” of South Korea and Japan are the most important if bilateral relations are to enter a new era.

The South Korean government is hoping Yoon can visit Japan by the end of this month for talks with Japanese Prime Minister Fumio Kishida.

The foundation expected to play a central role in settling the wartime labor dispute is the Foundation for Victims of Forced Mobilization by Imperial Japan, established by the South Korean government in 2014 to provide welfare support to former laborers and their surviving families.

The idea of using the foundation, however, has faced domestic opposition, with the plaintiffs’ supporters calling for Nippon Steel and Mitsubishi Heavy to pay damages as ordered by the Supreme Court.

Mitsubishi Heavy issued a statement on Sunday saying it is “not a position to comment on moves within South Korea,” while Nippon Steel declined to comment.