Japan and South Korea have agreed to mend an almost four-year-old trade dispute, the two governments announced on Thursday.

The announcement was made during South Korean President Yoon Suk Yeol's trip to Japan. He is the first South Korean leader to visit the country in 12 years.

What does the agreement mean?

Under the deal, Japan will end restrictions on the export of semiconductors to South Korea, and South Korea will drop a complaint it had lodged with the World Trade Organization (WTO) against Japan.

"Today's meeting with Prime Minister Kishida has a special meaning of letting the people of our two countries know that South Korea-Japan relations, which have gone through difficult times due to various pending issues, are at a new starting point," Yoon said in Tokyo on Thursday.

"As seen in North Korea's launch of a long-range ballistic missile before my departure to Tokyo this morning, North Korea's ever-growing nuclear and missile threats are a grave threat not only to East Asia but to international peace and stability." 

Decades-old tensions

The most recent trade dispute between South Korea and Japan arose after South Korea's Supreme Court ruled in 2018 that two Japanese companies, Nippon Steel and Mitsubishi Heavy Industries, must pay compensation to victims of forced labor during Japan's occupation of the Korean peninsula between 1910 and 1945.

Japan argued that the issue of forced labor had already been closed in a 1965 treaty.

Recently, Seoul announced a new proposal whereby former forced laborers or their relatives would instead be compensated by a public South Korean fund supported by private donations.

South Korean companies that benefited from the 1965 treaty would be targeted under this plan.

Thursday's rapprochement between Yoon and Japanese Prime Minister Fumio Kishida is an attempt to build a united front against regional tensions, including increased missile tests by North Korea and China's growing influence.

The deal will also strengthen international supply chains after years of upheaval.

zc/rc (AFP, AP, Reuters)