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Aggravation in the Korean-Japanese Relations: the Japanese Angle

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The trade war between Japan and South Korea is going on, and the author needs to clarify why Tokyo lost its temper at last.

The South Korean mass media, naturally, see the reasons for the trade war not as Seoul’s desire to ignore international law, but rather having to do with the internal political problems in Japan: Shinzo Abe needs internal unity of the country as the Japanese government has faced such problems as instability in connection with the trade dispute between the US and China, concern of the population in connection with the increase in consumer tax and the changes to the pension system. In this situation, South Korea is perfectly suitable as an “external enemy” who will distract and will rally the people. Alas, precisely the same expressions can be applied to Moon Jae-in as well, even in terms of concern about what the democratic president is doing with pensions, minimum wages, nuclear power, etc.

As the Japanese Prime Minister Shinzo Abe said already on July 22, the main problem in the relations of South Korea and Japan is that of compliance or non-compliance with their bilateral agreements. He mentioned the violation of the 1965 Agreement with Japan by the South Korean party, noting that South Korea was not implementing the international agreements which are the base for improvement in the relations.

In the author’s opinion, it would be useful to remind the readers about the nature of this agreement, thankfully, among the range of documents signed at the time, there were several devoted to “resolving the issues connected with property and claims for the compensation of damage.” Japan paid South Korea $200 million as a grant, another $300 million in loans with a favorable interest rate and $300 million in private loans on commercial terms. All this money was to go to the economic development of South Korea. In exchange, the parties confirmed that “the issues connected with property, rights and interests of the two High Contracting Parties and their peoples (including legal entities) and claims for the compensation of damage between the High Contracting Parties and between their peoples are hereby settled completely and finally.”

Thus, $800 million, from which $200 million was “money for nothing.” At the same time, the South Korean currency reserves in 1965 amounted to $1,800 million, and the South Korean state budget was $350 million, a third of which went to military expenses. Then, $800 million at that time would make about $6.5 billion dollars today. It is significantly more than the sum spent by the IMF and other banks in 1987 to pull South Korea out from the economic collapse of that time.

Some authors believe that this money was what formed the basis of the economic miracle. On these loans, the first South Korean modern iron and steel works of the POSCO company was constructed; the then largest Asian and the world’s fourth largest dam on the Cuoyanggang River was built; the main highway of the country, the highway Seoul-Busan, was built.

In 2005, previously confidential materials of the South Korean-Japanese negotiations were published. According to them, Japan offered to pay compensations to the Korean victims in person, but the South Korean authorities stated that they would take care of the matter. The main thing was to get money for economic projects. Besides, the problem of compensations was never brought up either by the authorities, or by the opposition, at the time. Even though the negotiations with the Japanese and the 1965 Agreement concluded later did cause mass protests, and the Park regime was accused of “selling the Homeland,” as, within the anti-Japanese........

© New Eastern Outlook