South Korea offers solution to wartime labor dispute with Japan

Seoul said it would set up a fund to compensate Koreans forced into labor by Japanese companies during World War II, an issue that Tokyo says , was settled a long time ago.

SEOUL - South Korea said Monday it had offered a resolution to one of its thorniest historical disputes with Japan, hoping to repair fractured ties between key U.S. allies.

The government said it had established a foundation that would pool funds from South Korean companies and use this money to compensate Koreans forced into labor by companies in Japan, which then ruled Korea as a colony, during World War II.

The question sent the The two countries' relations at one of the lowest points in decades after a 2018 ruling by South Korea's Supreme Court, which said Japanese companies were liable for compensating victims of forced labor. Japan has insisted that these issues were settled long ago, under a 1965 treaty that established post-war diplomatic relations. after the Supreme Court ruling, imposing trade restrictions and boycotting goods. Washington has repeatedly urged the two allies to resolve the dispute and work more closely together to deal with regional challenges like North Korea and China.

The President Yoon Suk Yeol of South Korea, who took office last May, has made improving relations with Japan one of his top diplomatic priorities. His government said on Monday it hoped Japanese companies that used forced Korean labor would also contribute to the fund.

So far, South Korean courts have awarded 15 victims a total of $3 million in compensation since the Supreme Court ruling, although Japanese companies refused to pay it. ​Hundreds of other victims are also suing for compensation.

ImageA gathers in Seoul on Monday denouncing the South Korean government's proposal.Credit...Lee Jin-Man/Associated Press

"Cooperation between South Korea and Japan is to vitally important," Foreign Minister Park Jin of South Korea said Monday at a press conference announcing the proposal. "We must no longer overlook the impasse in relations between South Korea and Japan and must end the vicious circle for our national interest."

To Tokyo , Foreign Minister Yoshimasa Hayashi told reporters that Japan "appreciates" the South Korean proposal, noting that it was "not based on the assumption that Japanese companies will contribute" to the fund.

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There was no immediate reaction from Korean victims of forced labor or their lawyers on Monday. But some victims had strongly criticized the proposed solution after key parts of it were leaked to South Korean media in recent weeks.

​Their main concern is that the money would not come directly from Japanese companies that profited from forced labor during the war, as the 2018 Supreme Court ruling states. Some of these companies include Japan's most successful, such as Nippon Steel and Mitsubishi Heavy Industries.

Seoul's announcement comes after months of negotiations with Tokyo. So far, according to South Korean media, Japan has resisted contributing to the fund, fearing it would amount to paying compensation. (Mr. Park said on Monday that the Japanese government would probably not object to contributions to the fund by Japanese companies, if made voluntarily.)

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