South Korea has terminated its military intelligence-sharing pact with Japan in the latest tit-for-tat dispute that has hit diplomatic and trade ties.
It comes after Japan removed South Korea’s favoured trade partner status and imposed export controls on its important electronics sector.
The tensions date to World War Two.
South Koreans want reparations for atrocities committed by Japan during its occupation of the Korean peninsula. Japan says the issue has been settled.
What has been affected?
Seoul said it had decided to end the intelligence-sharing pact because Tokyo’s recent decision to downgrade South Korea’s trade status caused a “grave” change in security co-operation between the two countries.
Japan’s Foreign Minister Taro Kono called it a “complete misjudgement of the current regional security environment” and said Tokyo would “strongly protest” to Seoul about it. There has been no response yet from Washington, which had pushed for the pact three years ago, in part to help track North Korea’s missile activity.
Earlier this month, Japan announced it would remove South Korea from its list of favoured trading partners – prompting a similar move from Seoul.
In July, Japan imposed export controls on materials used for memory chips and display screens – vital for South Korean companies like Samsung.
Stock markets slipped amid fears that the trade spat could badly affect electronics around the world.
The latest tensions stem from a South Korean court ruling last year that ordered Japanese companies to pay compensation to Koreans over forced wartime labour.
Mitsubishi Heavy, one of the firms involved, has reportedly refused to comply with the court order, while two other companies have had their assets seized in South Korea.
The issue has angered many in South Korea, with people boycotting Japanese goods. One man smashed up his Japanese-made car.
What’s the history?
The dispute stems from Japanese actions in World War Two.
During the conflict, tens of thousands of women – some say as many as 200,000 – from across Asia were sent to military brothels to service Japanese soldiers. Many of the victims, known as “comfort women”, were Korean.
Japan had annexed Korea in 1910, turning the territory into a colony. Millions of Korean men were also forcibly enlisted as wartime labourers.
In 1965, 20 years after Japan’s defeat and the end of its occupation of the peninsula, South Korean President Park Chung-hee agreed to normalise relations with the country in exchange for hundreds of millions of dollars in loans and grants.
Japan insists this “economic co-operation” pledge settled any claims for wartime reparations or compensation.
Why isn’t the issue settled?
The 1965 treaty was deeply unpopular among South Koreans, and democratic reforms in the 1990s allowed demonstrators to become far more vocal.
Since 1992, activists for the comfort women have rallied every Wednesday outside the Japanese embassy in Seoul, demanding an apology and reparations for the few dozen Korean comfort women left alive.
A deal was eventually signed in 2015. Japan apologised and promised to pay 1bn yen ($9.5m, £7.9m) – the amount South Korea asked for – to fund victims.
“Japan and South Korea are now entering a new era,” Japanese Prime Minister Shinzo Abe told reporters at the time. “We should not drag this problem into the next generation.”
But activists say they were not consulted, and rejected the deal. President Moon Jae-in, elected in 2017, suggested it be altered.
The historic dispute rumbles on, with neither country looking likely to bend.