When it comes to mending ties between the two nations, which have been tense for the last three years owing to wartime forced labor compensation concerns, the biggest business lobbies in both Korea and Japan will establish funds for collaborative initiatives.

A press conference was held in Tokyo on Thursday to announce the establishment of “future partnership funds” between the Federation of Korean Industries (FKI), a major business lobbying group, and the Japan Business Federation (Keidanren), in advance of a summit between Korean President Yoon Suk Yeol and Japanese Prime Minister Fumio Kishida.

Both FKI and Keidanren will set up their own funds, with oversight from a board co-chaired by the organizations’ respective leaders.

According to the lobbying organizations, the money will be used to facilitate human exchanges between the two nations and to finance cooperative business and research initiatives addressing issues such as energy and raw materials security, digital transformation, and demographic transition.

A public foundation supported by the Korean government was established to recompense victims of Japan’s wartime forced labor, with no required donations from Japanese businesses.

The Supreme Court of Korea’s ruling in late 2018 demanding compensation for Koreans forced into work by Japan during World War Two has strained relations between the two countries.

Keidanren Chairman Masakazu Tokura praised the new administration, saying, “this is a great step toward mending the relations between the two countries,” at a news conference.

In order to further enhance the route toward future-oriented connections, Tokura explained that the Keidanren and the FKI had decided to carry out joint initiatives and, separately, establish a future partnership fund.

In light of the rapidly evolving international scenario caused by Covid-19, heightened U.S.-China competition, and the weaponization of natural resources, acting FKI chairman Kim Byong-joon emphasized the need of cooperation between Korea and Japan.

There has been no final decision made about the amount of the fund.

As Kim put it, “FKI and Keidanren will raise the cash, not the individual firms,” and it is up to each business to decide whether or not to participate in the fundraising.

On Friday in Tokyo, FKI and Keidanren will be hosting a business roundtable discussion.

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