In a landmark deal, South Korean companies have agreed to pay compensation to resolve the forced labour dispute with Japan dating back to World War II. The plan, which was announced by South Korean officials, aims to heal the long-standing feud between the two nations.

The compensation will be paid to the victims of forced labour during Japan’s colonial rule of the Korean peninsula, which lasted from 1910 to 1945. The deal also includes a promise from Japan to contribute to a fund for the victims.

The agreement comes after years of tension between the two countries, with South Korea demanding compensation for the victims and Japan arguing that all claims were settled in a 1965 treaty.

The Biden administration hailed the deal as “groundbreaking” and a step towards reconciliation between the two nations. The announcement coincides with the G7 summit, where the leaders of major economic powers including the US, Japan, and South Korea will discuss global issues.

The forced labour dispute has been a major barrier to cooperation between South Korea and Japan, which are both crucial US allies in the region. The new deal is seen as a positive development for regional stability and security.

The agreement still needs to be approved by the South Korean victims and the Japanese government, but officials from both sides expressed optimism about the deal’s prospects. This could pave the way for closer cooperation on economic and security issues in the Asia-Pacific region.