TOKYO (Bloomberg) - Japan has agreed to pay 1 billion yen (S$13.3 million) to a foundation to help former comfort women, the Nikkei newspaper reported.
Friday's announcement follows an accord in December in which Tokyo and Seoul agreed to resolve the contentious issue 'finally and irreversibly.'
It comes despite inaction over the removal of a statue symbolising comfort women in front of the Japanese embassy in Seoul.
South Korea pledged in December to strive to solve the issue and a government insider has promised Japanese officials that President Park Geun Hye will keep her promise, the newspaper said.
Japanese Foreign Affairs Minister Fumio Kishida and his South Korea counterpart Yun Byung Se spoke by phone on the issue on Friday, the Japanese foreign ministry said.
The comfort women, who were trafficked to Japanese military brothels before and during World War II, have been the focus of repeated waves of antagonism between the Asian neighbors, who are also at odds over forced labour in the early 20th century and ownership of rocky outcroppings in the sea dividing them.
The sour relationship has frustrated the US, which wants closer military cooperation between its two major regional allies to help balance China's growing assertiveness.
Historians say anywhere from 50,000 to 200,000 women, many of them from the Korean peninsula, were rounded up to serve in Japan's military brothels as it invaded large parts of Asia during the first half of the 20th century.
Japan apologised in 1993 and set up a compensation fund that was rejected by some victims because it was financed with private donations instead of public money.
South Koreans have sought to draw more attention to the suffering of the women, only a few dozen of whom survive in the nation, erecting statues honoring them in the US, Australia, as well as one outside the Japanese embassy in Seoul.