South Korea announces plan to compensate victims of Japan's forced labour during World War II

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South Korea has announced it will consider a domestic fund to compensate Koreans enslaved by Japanese companies before the end of World War II.

Officials have been desperately trying to repair relations with Tokyo, which have deteriorated in recent years over historical grievances.

The plan, revealed during a public hearing organised by Seoul’s Foreign Ministry on Thursday, was met with fierce criticism by victims and their legal representatives, who have demanded that the reparations come from Japan.

Relations between Seoul and Tokyo have been strained since 2018 when South Korea’s Supreme Court upheld lower court verdicts and ordered Nippon Steel and Mitsubishi Heavy Industries to compensate Korean forced labourers.

The companies have refused to carry out the orders and the plaintiffs have responded by pursuing legal steps aimed at forcing the companies to sell off their local assets to provide compensation.

Rows of people stand behind a banner on stairs, each holding a placard bearing KOrean text.
Protesters hold banners saying: “Apology and compensation from Japanese war criminal companies and condemn the government of President Yoon Suk Yeol.” (AP: Ahn Young-joon)

South Korean officials feared the process would further rupture relations between Seoul and Tokyo.

Victims have also demanded the Japanese companies issue an apology over their ordeals.

An older-looking Korean man in a suit speaks into a microphone at a podium in front of a deep blue background.
Yoon Suk-yeol has expressed a commitment to improving ties with Japan. (AP Photo: Chung Sung-Jun/Pool Photo)

Ties between the US and its Asian allies have long been complicated by grievances related to Japan’s brutal rule of the Korean Peninsula from 1910 to 1945, when hundreds of thousands of Koreans were mobilised as forced labourers for Japanese companies or sex slaves at Tokyo’s wartime brothels.

South Korean President Yoon Suk-yeol has been eager to improve ties with Japan as the countries pursue stronger trilateral security cooperation with Washington in the face of the growing North Korean nuclear threat.

He met with Japanese PM Fumio Kishida in Cambodia in November, in the first bilateral summit between the countries in three years, where they expressed a commitment to swiftly resolve “pending” bilateral issues, which clearly referred to the forced-labour dispute.

During Thursday’s public hearing at the National Assembly, South Korean Foreign Ministry official Seo Min-jung said her government’s priority was to arrange payments as quickly as possible.

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She noted many victims of forced labour were already dead and most known survivors were in their 90s.

She said it would be “impossible” to make the Japanese companies apologise for the broad forced-labour issue.

“It would be important that Japan sincerely maintains and inherits the poignant expressions of apology and remorse that it already expressed in the past,” said Ms Seo, the ministry’s director of Asia and Pacific affairs.

Members of civic groups sit around a comfort-woman statue after they set it up in front of the Japanese consulate in Busan, South Korea
“Comfort women” have long been a source of conflict between South Korea and Japan. (AP: Kim Sun-ho)

Ms Seo said payments could possibly be handled by the Seoul-based Foundation for Victims of Forced Mobilisation by Imperial Japan.

Shim Kyu-sun, the foundation’s chairman, said payments could be funded by South Korean firms which benefited from Japanese economic assistance when the companies normalised their ties in the 1960s, including steel giant POSCO.

“The Japanese companies have reduced much of their economic activity in South Korea and withdrawn (many of their) assets, so it’s not even clear whether a liquidation process would be enough to provide compensation to the plaintiffs,” Ms Seo said.

Comfort statue unveiled
Statues commemorating comfort women in WWII have been erected around the world. (ABC News: Antoinette Lattouf)

She said government officials planned to meet the victims and their family members in person to explain the payment plans and seek their consent.

Lim Jae-sung, a lawyer who represented some of the plaintiffs in the 2018 rulings, accused the government of pushing ahead with a settlement that excessively aligned with Japan’s position while ignoring the voices of victims.

“It seems that the South Korean government’s finalised plan is to use the money by South Korean companies like POSCO to allow the Foundation for Victims of Forced Mobilisation by Imperial Japan to eliminate the forced labour victims’ rights to receivables,” Mr Lim said.

“Japan doesn’t take any burden at all.”

Japan has insisted all wartime compensation issues were settled under a 1965 treaty normalising relations between the two nations that was accompanied by hundreds of millions of dollars in economic aid and loans from Tokyo to Seoul.

Japan reacted furiously after the South Korean rulings in 2018 and subsequently placed export controls on chemicals vital to South Korea’s semiconductor industry in 2019, citing the deterioration of trust between the countries.

Seoul accused Tokyo of weaponising trade and even threatened to terminate a military intelligence-sharing agreement with Tokyo, which was a major symbol of their three-way security cooperation with Washington.

South Korea eventually backed off and kept the deal after being pressured by the Trump administration.

Nippon Steel and Mitsubishi Heavy Industries had refused to carry out the 2018 rulings and re-appealed to the Supreme Court after lower courts ordered them to sell off their local assets to compensate the plaintiffs.

The Supreme Court has yet to make a decision on whether to allow the liquidation of the companies’ assets to proceed.

AP