Korea to announce 3rd-party solution to forced labor issue

• Published date: 05 March 2023
• Publication title: The Korea Times

Korea will announce its solution to settle a dispute over wartime forced labor caused by Japan's 1910-45 colonial rule on Monday as part of a diplomatic deal to restore the two countries' relations after nearly five years of tensions.

According to government sources and Japanese media reports, Sunday, Mitsubishi Heavy Industries and Nippon Steel ? the Japanese companies ordered in 2018 by the Supreme Court here to compensate South Korean victims of slave labor ? will not pay damages. Instead, they are expected to contribute to a fund set up to improve relations between the two countries.

The Future Youth Fund, which is likely to be co-created by the Federation of Korean Industries, Korea's big-business lobby group, and its counterpart the Japan Business Federation, will use the generated money to sponsor student exchange programs.

Foreign Minister Park Jin is expected to announce the details of the agreement.

The deal, however, will almost certainly draw criticism from the victims, who have been demanding direct compensation and apologies from the Japanese companies, which, along with the Japanese government, have maintained that the issue was settled as part of the two countries' 1965 treaty. Under the agreement, Tokyo provided Seoul with $300 million (388 billion won) in grants and $200 million in loans as a way of paying back Korea after occupying it for 35 years.

The compensation will instead come from the Foundation for Victims of Forced Mobilization by Imperial Japan, which was established in 2014 to raise donations from Korean companies that had benefited from the 1965 treaty, such as POSCO.

How the Japanese government will react to the decision is less clear. According to the Asahi Shimbun and the Yomiuri Shimbun, the Fumio Kishida administration may suggest that President Yoon Suk Yeol hold a summit in Tokyo and issue a statement to succeed the 1998 joint declaration in which Japan apologizes for the immense pains and damage it caused to the people of Korea during its occupation. The Japanese government also plans to lift restrictions on some tech material exports to Korea and restore its status as one of its trusted trade partners on its "whitelist."

Moreover, the two countries are considering resuming the past...