South Korea Announces ‘Historic’ Plan to Compensate Victims of Wartime Forced Labor

Japan's Prime Minister Fumio Kishida (L) and South Korea's President Yoon Suk-yeol take part in the ASEAN-Plus Three Summit as part of the 40th and 41st Association of Southeast Asian Nations (ASEAN) Summits in Phnom Penh, Cambodia, on Nov. 12, 2022. Tang Chhin Sothy/AFP via Getty Images

South Korea’s government announced a plan on Sunday that aims to resolve a long-running dispute on compensating Koreans forced to work under Japan’s colonial rule of the Korean Peninsula between 1910 and 1945.

The move marks a step toward improving ties between the two nations and comes as South Korean President Yoon Suk-yeol seeks to bolster relations with Japan amid ongoing concerns regarding North Korea’s ever-increasing nuclear weapons program.

South Korean Foreign Minister Park Jin announced the plan at a news conference where he said that the Foundation for Victims of Forced Mobilization by Imperial Japan, a public service corporation established in 2014, will pay damages and interest to the victims using private donations, Reuters reported.

The labor dispute between Japan and South Korea stems from the former’s rule of the Korean Peninsula from 1910 to 1945, during which hundreds of thousands of Koreans were mobilized as forced laborers for Japanese companies, or as sex slaves—also known as “comfort women”—at Tokyo’s military-run brothels during the Second World War.

Shim Kyu-sun, chairperson of the foundation, said in January that the donations would come from South Korean companies that benefited from a 1965 bilateral treaty that normalized relations between the two nations.

That treaty was accompanied by hundreds of millions of dollars in economic aid and loans from Tokyo to Seoul, South Korea—then ruled by President Park Chung-hee—that were used for development projects conducted by major South Korean companies, including steelmaker Posco Holdings Inc., state-run Korea Electric Power Corp. (KEPCO), and tobacco maker KT&G, among others, Yonhap News Agency reported.

So far, Posco has donated 4 billion won ($3.1 million) to the foundation.

A statue of a girl symbolizing the issue of "comfort women" in front of the Japanese Embassy in Seoul, South Korea, on Dec. 28, 2015. Chung Sung-jun/Getty Images

‘Voluntary Contributions, Comprehensive Apology’

“The government hopes to work with Japan, our closest neighbor, who shares the universal values of liberal democracies, market economies, rule of law and human rights amid the increasingly severe situation on the Korean Peninsula and amid the current grave international situation,” South Korean Foreign Minister Park Jin said in prepared remarks, according to The Japan Times.

The foreign minister added that he hopes Japan will “positively respond to our major decision today with Japanese companies’ voluntary contributions and a comprehensive apology.”

Monday’s plan was welcomed by the United States.

In a statement issued by the White House, President Joe Biden called the announcement a “groundbreaking new chapter of cooperation and partnership between two of the United States’ closest allies.”

“The United States will continue to support the leaders of Japan and the Republic of Korea as they take steps to translate this new understanding into enduring progress,” Biden said, adding that once the plan is “fully realized,” it will help the United States to “uphold and advance our shared vision for a free and open Indo-Pacific.”

Separately, Japanese Foreign Minister Yoshimasa Hayashi told reporters that the announcement marked the “return to a healthy relationship between Japan and South Korea.”

Kim Bok-dong (L) and Gil Won-ok, who were forced to serve as sex slaves for Japanese troops during the Second World War, attend a protest with other supporters outside the Japanese embassy in Seoul, South Korea, on Aug. 12, 2015. Jung Yeon-je/AFP/Getty Images

“The measures announced by the South Korean government are not on the premise that Japanese companies will contribute to the foundation (in South Korea). The Japanese government doesn’t have any particular stance on voluntary donations by individuals or private companies both in Japan and abroad,” Hayashi said.

Tensions Between Japan, South Korea

The announcement came amid backlash from former forced laborers and their supporters. They had called on Japanese companies in a lawsuit to provide direct compensation and for the government to issue a public apology.

In 2018, South Korea’s Supreme Court ruled that Japan’s Nippon Steel and Mitsubishi Heavy Industry should compensate 100 million Korean won ($77,000) to each of the 15 South Korean victims involved in the lawsuit.

Only three of them are still alive today, and all are in their 90s.

However, Japan insists that all wartime compensation issues were settled under the 1965 treaty that normalized diplomatic relations. None of the victims have yet been compensated.

Shortly after the Supreme Court ruling and amid heightened tensions, Japan in 2019 restricted exports of materials to South Korea that were vital to its semiconductor industry while South Koreans launched a boycott of Japanese goods.

Hayashi told reporters that his government’s stance on the treaty resolving the issues had not changed.

Meanwhile, Lim Jae-sung, a lawyer representing some of the former laborers, condemned the government plan.

“Basically, the money of South Korean companies would be used to erase the forced laborers’ rights to receivables,” Jae-sung wrote on Facebook, according to NBC News. “This is an absolute win by Japan, which insists it cannot spend 1 yen on the forced labor issue.”

The Associated Press contributed to this report.