TOKYO/SEOUL • Japan's top government spokesman yesterday said ties with South Korea are in a "severe state", signalling that tensions between the neighbours and US security allies could worsen.
Tokyo and Seoul have sparred over decisions in South Korea's top court requiring two of Japan's biggest firms to pay compensation to Koreans forced into labour during Japan's 1910-45 colonial rule.
Japan's Prime Minister Shinzo Abe on Sunday said he would consider counter-measures to protect Nippon Steel & Sumitomo Metal assets from seizure by Seoul courts.
"Relations between Japan and South Korea are in a severe state," Japanese Chief Cabinet Secretary Yoshihide Suga told a regular news conference in Tokyo, calling recent moves by Seoul regrettable.
Mistrust between the two neighbours has also grown as both sides trade accusations about who was in the wrong over a December incident in which Japan claimed a South Korean naval vessel used a target-lock radar on its patrol aircraft. Seoul argued that the plane was flying in a provocative manner and called on Tokyo to apologise.
The two sides have long wrangled over whether Japan has properly atoned for its occupation of the Korean Peninsula, which ended with the Japanese Empire's defeat in World War II.
The disputes have flared anew since the 2017 election of South Korean President Moon Jae-in, whose administration has moved to disband a fund to compensate women forced to work in Japanese brothels and backed Koreans' efforts to pursue the forced labour claims.
Maximum amount Mitsubishi Heavy Industries has been ordered to pay to each of the 10 people subject to forced labour.
What Nippon Steel has been told to pay to each of four plaintiffs.
Prime Minister Abe told national broadcaster NHK that he had "requested relevant departments to study specific measures based on international law" to prevent South Korea from seizing company assets. He called a bid by plaintiffs to get the court to confiscate company property "very regrettable".
Mr Abe said a 1965 treaty that normalised relations between the countries resolved all matters regarding compensation claims.
Before Mr Suga spoke, South Korea's foreign ministry said it expected a sincere response from Japan and declined to directly address Mr Abe's comment.
Foreign ministers from the two countries talked last week by telephone, South Korea said. Last month, officials from both countries said they were speaking with each other on ways to address the court's decisions.
Mitsubishi Heavy Industries was ordered to pay up to US$134,000 (S$182,000) to each of the 10 people subject to forced labour, while Nippon Steel was ordered to pay four plaintiffs US$88,000 (S$119,000) each. There are over a dozen such cases pending in South Korea involving about 70 firms, said Japan's government.
Lawyers representing South Korean conscript labourers applied to a Pohang city court to seize Nippon Steel assets, said Associated Press last Thursday. The court may decide in two or three weeks whether to accept the request to seize the 2.34 million shares - worth about US$9.7 million - that Nippon Steel holds in its joint venture with South Korean steelmaker Posco.
Japan and South Korea were each other's third-largest trading partners in 2017, with more than US$82 billion in total trade between the two sides.
Although simmering tensions between Japan and South Korea have led to protests on Seoul's streets and calls to boycott Japanese products, the previous disputes have never escalated to the point where they caused serious economic damage.