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After Posco donation to fund, other companies wait and see

Published: 15 Mar. 2023, 19:05

A photo above shows the Foundation for Victims of Forced Mobilization by Imperial Japan situated in Jongno District, central Seoul, on Wednesday. Posco donated a total of 4 billion won ($3.07 million) to the foundation on Wednesday. [YONHAP]

Domestic companies are cautiously “reviewing” whether to donate to a public foundation to compensate Japan’s wartime forced labor victims after Posco donated a total of 4 billion won ($3.07 million) on Wednesday.

The public foundation is to be funded by domestic companies, part of the Korean government's scheme to come up with a plan for the forced labor issue — to compensate Japan’s wartime forced labor victims as well as to mend relations with Japan.

Posco made the donation to the foundation created by Korea to compensate the forced labor victims, meeting the minimum required funds needed to compensate the victims rather than the Japanese corporations they sued.

“In light of the government announcement of its position regarding the Supreme Court ruling on forced labor, Posco decided to voluntarily contribute 4 billion won to the foundation,” the company in a statement on Wednesday.

The company, one of a few known to have benefitted from the Japanese aid and loans given after the normalization of ties between Japan and Korea in 1965, had pledged to give a total of 10 billion won to the foundation in 2012, to be used for the forced labor victims. It had given a total of 6 billion won as of 2017.

By paying the 4 billion won, it was fulfilling its pledge, the company said in its statement.

The 4 billion won covers the entire amount that the foundation needs at the moment to compensate the 15 victims of forced labor embroiled in lawsuits with Japanese companies.

The Korean government announced the plan on March 6, to compensate 15 plaintiffs, including three elderly survivors and family members of deceased forced labor victims, through the previously existing Foundation for Victims of Forced Mobilization by Imperial Japan.

The foundation, under the Interior Ministry, will be financed mainly through voluntary contributions from the private sector and other fundraising projects — including donations from some 16 Korean companies who benefitted from the 1965 claims settlement agreement which normalized ties between Korea and Japan.

Posco is the first domestic company to take the first step forward to make the contribution. American Chamber of Commerce in Korea (Amcham) donated to the foundation on Tuesday, although the amount of contribution was not publicly disclosed.

Other companies are still testing the waters, although they are willing to “actively take into consideration” if the government makes a formal request.

Some of the other 15 companies include Korea Expressway Corporation, Korea Railroad Corporation, Hana Bank, Korea Electric Power Corporation, KT, KT&G and Korea Institute of Science and Technology.

“We are willing to actively review the donation if the government makes an official request to do so, but we have received no notice as of now,” said a Hana Bank spokesperson.

Hana Bank merged with Korea Exchange Bank in September 2015. Korea Exchange Bank is one of the banks to have benefitted under the 1965 agreement.

KT made a similar statement on Wednesday, saying that it is willing to “actively consider” looking into the matter once requested by the government.

Several forced labor victims have opposed third-party compensation from the fund. Kim Seong-joo, Yang Geom-deok and Lee Chun-sik, victims of forced labor by Japan during the 1910-45 Japanese occupation of Korea, formally announced in a statement on March 13 they are refusing the Korean government proposal to have Korean companies compensate them instead of Japanese companies.

“We don’t see it as a social settlement, or believe that it is fair for domestic companies to comply to make the donation,” said a spokesperson who wished to remain anonymous. “However, it’s a no-win situation in which companies do need to follow the government requests if it’s made.”

President Yoon Suk Yeol will make a two-day visit to Tokyo from Thursday for a summit with Japanese Prime Minister Fumio Kishida, signaling the "normalization" of relations, according to his national security adviser Tuesday.

BY LEE JAE-LIM, ESTHER CHUNG [[email protected]]