TOKYO/SEOUL (Reuters) – South Korea and Japan may be on the verge of settling a disagreement over colonial-era forced labour that has hampered political and commercial ties between the two neighbours, according to media reports.

According to anonymous diplomatic sources, the South Korean government aims to unveil its solution to the historical and legal disagreement over paying Koreans forced to labour during Japan’s 1910-1945 colonisation of Korea on Monday morning.

For years, a labour disagreement and a dispute over women forced into Japanese military brothels have strained relations between the two crucial US allies.

When queried about the purported agreement, South Korea’s foreign ministry said that talks were still underway.

“The administration is continuing to communicate in different ways amongst diplomatic officials at all levels in order to reach a fair solution that fulfils the shared interests of Korea and Japan as soon as feasible,” the statement stated.

Requests for comment by phone and email to Japan’s Cabinet Office and Foreign Ministry were not immediately returned.

Relations reached a low point in decades when South Korea’s Supreme Court ordered Japanese companies to make reparations to former forced labourers in 2018. While fifteen South Koreans have won similar claims, none have received compensation.

The argument escalated into a commercial dispute. Japan has stated that previous accords resolved the compensation problem.


In January, Seoul announced a proposal to recompense former forced labourers via a South Korean public foundation. The idea generated outrage among victims and their relatives since it excluded donations from Japanese firms, even those forced to pay reparations by South Korean courts.

According to Kyodo, Japan may enable its corporations to “voluntarily” donate to the foundation, and the two countries are hoping for South Korean President Yoon Suk-yeol to visit Japan this month.

According to South Korea’s Yonhap news agency, citing anonymous government sources, Seoul and Tokyo have informally agreed to establish a “future youth fund” to underwrite student scholarships as part of the agreement.

According to the article, the fund would be co-founded by the Federation of Korean Industries, South Korea’s major business lobby, and its Japanese equivalent, Keidanren.

According to Japan’s Nikkei, a Korean foundation would pay reparations on Japan’s behalf, and the Japanese side will recognise prior administrations’ sentiments of remorse and contemplation.

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