South Korea and Japan signaled a breakthrough to end a feud that had disrupted ties on everything from trade to security, drawing praise from President Joe Biden as he seeks to convince the two US allies to work together in his efforts to counter China.
(Bloomberg) — South Korea and Japan signaled a breakthrough to end a feud that had disrupted ties on everything from trade to security, drawing praise from President Joe Biden as he seeks to convince the two US allies to work together in his efforts to counter China.
South Korean President Yoon Suk Yeol’s government said Monday that it would resolve a dispute over people who were forced to work for Japanese companies during the country’s colonization of the Korean Peninsula by having local firms compensate victims. Japan’s foreign minister, Yoshimasa Hayashi, welcomed the effort to “return ties to a healthy state,” and the two sides announced talks on rolling back trade curbs imposed almost four years ago.
“The government hopes to build a future-oriented relationship between Korea and Japan, based on reconciliation and cooperation,” South Korean Foreign Minister Park Jin told a news conference Monday in Seoul. He also called Japan his country’s “closest neighbor” sharing “universal values such as freedom and democracy, market economy, rule of law, and human rights.”
Under Yoon’s solution, companies that benefited from funds transferred under a 1965 treaty with Japan, including Posco Holdings Inc., would finance a foundation to pay the victims. Seoul would also withdraw a World Trade Organization complaint over Japanese export controls on chemicals used to make smart-phone displays, TV screens and semiconductors and seek trade talks with Tokyo to lift them.
The Japanese Ministry of Economy, Trade and Industry issued a statement Monday saying the government wanted to restore ties to their state before July 2019, when the export controls were imposed.
“Today’s announcements between the Republic of Korea and Japan mark a groundbreaking new chapter of cooperation and partnership between two of the United States’ closest allies,” Biden said in a statement. “When fully realized, their steps will help us to uphold and advance our shared vision for a free and open Indo Pacific.”
Shares of Japanese and South Korean tech-related stocks gained. In Seoul, Samsung Electronics rose as much as 1.7% and LG Electronics gained 4.2%. In Japan, Stella Chemifa closed 3.9% higher.
The move to restore ties with Japan represents a political gamble for Yoon, even though the conservative former prosecutor was elected last year on a pledge to expand South Korea’s role in the US’s global alliance network. Forced labor has long provided an emotional rallying point in Korea, where many believe Tokyo hasn’t sufficiently atoned for its 1910-45 colonial occupation of the peninsula.
The issue resurfaced after former South Korean President Moon Jae-in took power in 2017 and the country’s top court ruled Japanese companies were liable for compensation. Japan, which believed the dispute settled by the 1965 treaty, subsequently removed South Korea from its “white list” of trusted export destinations. Moon threatened to withdraw from a military-intelligence-sharing pact, although he later backed down.
Resolving the feud has become more urgent for the US and its allies as they attempt to present a more united front against China and North Korea in the wake of Russia’s invasion of Ukraine. Both Yoon and Japanese Prime Minister Fumio Kishida have sought to show their support for greater cooperation on security issues, with both men attending North Atlantic Treaty Organization meetings last year and their militaries publicizing joint drills.
Yoon may visit Japan for talks with Kishida later this month, the Seoul-based Yonhap News Agency reported, citing people it didn’t identify. Previous reports have said Yoon could be invited as a guest to the Group of Seven summit in Japan in May if the disputes were smoothed over.
The deal faced an immediate backlash in South Korea, where Yoon’s approval rating has hovered at around 40% since his narrow victory a year ago over Moon’s would-be Democratic Party successor. The opposition party, which still holds a supermajority in parliament, labeled it a “day of shame” and accused Yoon of “subservience to Japan.”
A group representing forced-labor plaintiffs said Yoon’s government was “trampling on their human rights and dignity by imposing unjust choices on victims to receive ‘donations’ instead of ‘compensation’ in pursuit of their diplomatic achievements of improving Korea-Japan relations.”
Notably, Yoon’s government said it wasn’t seeking a new apology from Japan, something forced-labor victims had demanded. Asked about the reports in a parliamentary committee Monday, Kishida said his government would uphold the historical stance of previous cabinets and that nothing was decided on which nations would be invited as guests to G-7.
“What we’ve seen is that the victims have many ways of undermining these agreements and if we also see a more progressive president take the helm next time, there’s every reason to believe they may dissolve this,” said Lauren Richardson, a lecturer in international relations at Australian National University. “That’s a real sore point for Japan, which has the same sort of conservative party in power constantly, so it’s very hard for them to understand why South Korea has these massive swings.”
A spokesman for Nippon Steel Corp., one of the companies affected by the lawsuits, said it was the firm’s understanding that all such claims had been settled in 1965 and that the two governments were continuing to negotiate. Mitsubishi Heavy Industries Ltd. said it respected the Japanese government’s view on wartime labor, Kyodo News reported.
The WTO agreed in 2020 to mediate the spat between the countries over Japanese restrictions on three classes of chemicals used in high-end manufacturing. South Korea had called the restrictions a “politically motivated” move that hurt South Korean manufacturers such as Samsung Electronics Co. and SK Hynix Inc.
Cheon Seong-whun, a former security strategy secretary at South Korea’s presidential Blue House, said managing domestic public opinion in South Korea was a top priority now.
“People who are critical of the government within South Korea are likely to criticize Yoon even more over this agreement,” he said. “Therefore, there is concern that if Yoon Suk Yeol’s government’s approval ratings drop, the momentum to pursue this agreement may also decrease.”
–With assistance from Shinhye Kang, Tsuyoshi Inajima and Lily Nonomiya.
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