SEOUL (Kyodo) -- The South Korean government plans to announce its solution to a wartime labor compensation dispute with Japan on Monday morning, diplomatic sources said Sunday, a move that could pave the way for bilateral relations to emerge from the doldrums.
Seoul has been considering providing compensation payments to former Korean laborers through a government-backed South Korean foundation, instead of requiring Japanese companies to pay the damages as ordered by South Korean court rulings.
The latest development comes as relations between Tokyo and Seoul have shown signs of improvement after President Yoon Suk Yeol took office in South Korea in May last year with a pledge to take a future-oriented approach toward Japan.
While South Korea was under the government of Yoon's predecessor Moon Jae In, bilateral ties sunk to their lowest point in years over wartime labor and other issues stemming largely from Japan's 1910-1945 colonization of the Korean Peninsula.
The rift over wartime labor deepened as South Korean top court rulings in 2018 ordered two Japanese companies to pay damages over forced labor.
The companies have refused to comply with the orders as Japan has maintained that all issues stemming from its colonization were settled under a bilateral agreement signed in 1965.
If Seoul decides to ensure compensation payment to former Korean laborers through a South Korean foundation, the Japanese government will allow Japanese firms to voluntarily provide donations to the South Korean foundation, a diplomatic source has said earlier.
The Japanese government is also expected to express remorse to former Korean laborers, in line with past government statements over Japan's wartime aggression in Asia, and lift restrictions on certain tech exports to South Korea, according to the source.
