South Korea seeks to improve ties with Japan with a plan for compensating victims of forced labor

South Korea released a plan for compensating Korean victims of forced labor under Japanese occupation. By not seeking reparation from the Japanese companies, relations between the two countries are expected to improve amid concerns about regional security with North Korea.

South Korea President Yoon Suk-yeol
South Korea President Yoon Suk-yeol on March 1 on the 104th anniversary of the declaration of independence from Japan | © South Korea’s Ministry of Foreign Affairs

South Korea announced on March 6 a plan that seeks for compensating Korean victims who were forced to work in Japanese factories and mines during WWII. The plan, which avoids Japanese companies compensating for Korean victims, is also viewed as a way to ease relations between the two countries amid broader security concerns in the region.

The minister of Foreign Affairs of South Korea Park Jin said the former workers would be compensated through a public foundation funded by private-sector companies without elaborating further on how the foundation would be financed.

We welcome this as a step that returns Japan-South Korea relations to a healthy one,” said Japanese Foreign Minister Yoshimasa Hayashi.

But such a plan, which was first raised as a proposal by the government in January, sparked criticism among victims and their families – the few survivors of forced labor still alive are now in their 90s – because Japanese firms involved in forced labor don’t contribute to the compensation. The Democratic Party, the main opposition of the ruling conservative party in South Korea, considered the plan a “submissive diplomacy”.

South Korea shares a bitter wartime history with a country that occupied the Korean peninsula from 1910 to 1945.

Thousands of Koreans were mobilized as forced laborers for Japanese companies during WWII. But during that time the Japanese military also managed brothels and forced women, mainly from Japan and Korea but also from the Philippines, China, Taiwan, Indonesia and elsewhere in Asia, to provide sex for the Japanese army. Brothels were called “comfort stations” with “comfort women”. Japan justified those stations as a way to limit the rapes by the army.

But Japan argues all disputes related to that colonial period were resolved with a bilateral treaty in 1965. The treaty consisted of 300 million dollars in economic aid and some 500 million dollars in loans from Japan to rebuild its infrastructure and economy devastated by the Korean War.

At the time, South Korea was ruled by authoritarian president Park Chung-hee. The agreement created massive protests and the government declared martial law.

Companies like POSCO, a Korean steel giant which benefited from aid received as part of an agreement in 1965, may need to donate to the fund announced this Monday. Japanese companies are able to voluntarily contribute to the fund, which the Korean government hope they will.

In 1995, Japanese Prime Minister Tomiichi Murayama issued a “profound apology” regarding Japanese colonial policy.

In 2015, a new settlement was signed between Japan and South Korea, with Tokyo providing 1 billion yen (9.23 million dollars in 2015) to support the victims of brothels. But the deal was controversial because the compensation was viewed as insufficient and because Japan hadn’t acknowledged legal responsibility for atrocities during its colonial occupation. Many victims refused the settlement and to receive payment.

A 64-year-old Buddhist monk died after setting himself on fire to protest the deal in January 2017.

And former South Korean President Moon Jae-in in 2018 dissolved the Japan-funded foundation considering it didn’t have the victims’ consent.

The same year the Supreme Court of South Korea ordered Japanese companies Nippon Steel and Mitsubishi Heavy Industries to pay reparations, between 80 million and 150 million won (72,000 to 135,000 dollars in 2018) for each plaintiff, to 14 victims of forced labor. They didn’t, and several victims have passed away since then.

These tensions between the two countries also spread to the economic field. Viewed as an unofficial retaliation to the Supreme Court orders, Japan under former Prime Minister Shinzo Abe in June 2019 restricted exports of components essential to technology such as semiconductors and smartphone screens to South Korea. Three elements were switched from comprehensive export licenses to individual export licenses, requiring individual reviews for each export project. South Korea was also excluded from a preferred list that simplified export procedures, such as for controls for security reasons for instance.

In September 2019, South Korea filed a complaint with the World Trade Organization, arguing that Japan’s export restrictions were unfair.

But the Japanese ministry of Economy, Trade and Industry stated on Monday that Japan and South Korea would hold an export control policy dialogue. The Korean Korean government temporarily suspended the WTO dispute settlement procedures during the consultations.

The prime minister of Japan Fumio Kishida said on Monday during a parliamentary session said that the restoration of trade ties is a separate issue from the compensation for forced labor.

The ease of tensions initiated by South Korea, which also has some resentment about Japan’s territorial claims over islands occupied by South Korea, comes as North Korea becomes more threatening with nuclear and ballistic missile capabilities and tests.

Conservative president Yoon Suk-yeol in his speech on March 1 during the celebrations of the 104th anniversary of the declaration of independence from Japan considered “Japan has transformed from a militaristic aggressor of the past into a partner that shares the same universal values with us. Today, Korea and Japan cooperate on issues of security and the economy. We also work together to cope with global challenges.”

Elected in 2022, Mr. Yoon advocated for a stronger alliance with the United States and a tougher line on North Korea during the presidential campaign. He also pledged to improve ties with Tokyo.

The trilateral cooperation between the Republic of Korea, the United States and Japan has become more important than ever to overcome the security crises including North Korea’s growing nuclear threats and global multiples crises,” Mr. Yoon added.

The president of the United States Joe Biden, who met Mr. Yoon 11 days after the latter took office, welcomed the move leading to warmer relations between two of its closest allies in Asia. South Korea and Japan “are taking a critical step to forge a future for the Korean and Japanese people that is safer, more secure, and more prosperous,” Mr. Biden said in a statement.

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