Japan & South Korea Reach Breakthrough In Dispute Over Wartime Forced Labour

South Korea's President Yoon Suk-yeol announced a solution to end his country's long-running dispute with Japan over compensation for wartime forced labourers, which has weighed over bilateral relations in the recent years.

• The feud resurfaced in 2018 as a South Korean court ordered two Japanese companies to pay compensation to the Korean victims, while Tokyo insisted that all claims have been settled under a 1965 treaty.
• Under the mutually agreed plan, a South Korean government-backed foundation will compensate the victims without any involvement of Japanese companies. While the solution constitutes a diplomatic breakthrough, it is set to provoke some domestic backlash from South Korean opposition parties and advocacy groups.
• In addition, South Korea will halt a WTO complaint process against Japan, which slapped export controls on Seoul as the historical dispute spilled over into trade relations. The two sides will hold consultations with the aim of lifting export restrictions imposed in the past few years.
• Efforts to restore bilateral relations intensified amidst geopolitical threats shared by the two East Asian democracies, with increasingly assertive posturing by China and North Korea forcing local policymakers to rethink foreign policy.