Photo/IllutrationThe front pages of major South Korean newspapers on Oct. 31 carry top stories about the Supreme Court ruling the previous day ordering compensation payments by Nippon Steel & Sumitomo Metal Corp. to former wartime laborers. (The Asahi Shimbun)

After perhaps underestimating the potential ramifications of a court case, Seoul now finds itself in a dilemma of trying to appease both the South Korean and Japanese publics while avoiding further friction with Tokyo.

President Moon Jae-in has said his administration would respect the South Korean Supreme Court’s ruling Oct. 30 that ordered a Japanese company to pay compensation to South Korean wartime laborers.

At the same time, maintaining relations with Japan requires abiding by the 1965 agreement that said all property and claims from World War II had been settled.

Tokyo has used that bilateral agreement as the basis for its argument that it is totally unacceptable to now demand compensation from Japanese companies for bringing Korean workers to Japan during World War II.

The South Korean government on Oct. 31 began preparations to establish a joint public-private committee to consider what measures could be implemented to navigate the tight spot the government now faces.

The court ruling has been praised by the South Korean public but criticized in Japan as a potential detriment to bilateral relations.

For that reason, one high-ranking South Korean Foreign Ministry official said there was no telling how long it would take for the committee to reach a conclusion.

Experts have raised various possibilities to deal with the situation, but it remains to be seen how realistic those measures are.

One proposal is to convert the issue into a totally domestic one to prevent a further deterioration of ties with Japan.

For example, the South Korean government could increase the payments to wartime laborers under a program that has been in place since a special law was enacted in 2007.

But to prevent a flood of similar lawsuits by other former laborers, the South Korean government would have to greatly increase the payment amounts, according to one expert.

In addition, critics oppose the measure, saying it would go against the spirit of the Supreme Court ruling, which ordered Nippon Steel & Sumitomo Metal Corp. to pay the compensation.

In 2014, the South Korean government and a number of companies established a foundation to provide support to wartime workers.

However, a South Korean Foreign Ministry source said the Japanese government or companies would likely not contribute to that foundation because of Tokyo’s position that the 1965 agreement has settled the claims issue.

The South Korean government had shown signs that it was taking an overly optimistic view of any fallout from the case before the Supreme Court.

When Vice Foreign Minister Takeo Akiba met his South Korean counterpart, Cho Hyun, in Tokyo on Oct. 25, he clearly told Cho that Japan would never accept any verdict that ordered compensation payments by a Japanese company.

Sources said South Korean diplomats began transmitting more frequent messages to their Japanese counterparts that various measures were being considered.

“There was a lack of a sense of crisis on the South Korean side at first,” a government source said. “They only appeared to realize the magnitude of the problem when the verdict date neared.”

Indicating that the government would wait and see what response Seoul came up with, a high-ranking Foreign Ministry official said, “The ball is in South Korea’s court.”

Prime Minister Shinzo Abe indicated on Nov. 1 that he expects Seoul to defuse the situation.

“I strongly hope that the South Korean government will make a positive response,” Abe said in answering questions at the Lower House Budget Committee.

But Abe’s own ruling Liberal Democratic Party may not allow the government to sit on its hands and wait for a response from Seoul.

A joint session of the Foreign Affairs Division and other divisions held on Nov. 1 passed a resolution urging the government to take stronger action, such as an expedient start to mediation procedures as defined in the 1965 compensation claims settlement agreement as a way to resolve disputes.

The resolution also called on the government to consider taking the measure up with the International Court of Justice.

(This article was written by Hajimu Takeda in Seoul and Tamiyuki Kihara in Tokyo.)