SEOUL—South Korea implemented a deal with Japan to compensate women used as military prostitutes, fresh evidence of a thaw between two feuding U.S. allies that Washington has pressed to work together to counter North Korea’s nuclear threat and an assertive China.
On Thursday, Seoul launched a foundation to provide financial support for Korean women used as forced sex workers by the Japanese military in the 1930s and 1940s. The Japanese government pledged $9.5 million to fund the organization and provided an apology from Prime Minister Shinzo Abe in a surprise breakthrough late last year.
The dispute over so-called “comfort women” has been the central irritant to bilateral ties among several legacies of Japan’s 35-year colonization of the Korean Peninsula through 1945. Mainstream historians estimate there were between 20,000 and 200,000 such women, but only 40 confirmed South Korean comfort women are still alive. The youngest is 84.
U.S. officials strongly welcomed the deal, which they said would help security cooperation. North Korea’s nuclear test in January and repeated test-firings of ballistic missiles provided momentum for closer Tokyo-Seoul defense ties.
In June, the Japanese and South Korean defense ministers agreed to set up a hotline with each other. Later that month, the U.S., Japan and South Korea held their first trilateral missile defense exercise near Hawaii. The drill involved the nations tracking and sharing information about a hypothetical missile launch by North Korea.
Frosty personal relations between South Korean President Park Geun-hye and Japanese Prime Minister Shinzo Abe have also improved after a summit meeting in late 2015 and talks in Washington this year. Japan, which North Korea threatens with its missiles, has backed a hard-line approach by Ms. Park to dealing with Pyongyang through sanctions and diplomatic pressure.
There has also been some improvement in negative views among Japanese and South Koreans about each others’ countries. In an annual poll released this month, the number of South Koreans who said they had unfavorable impressions of Japan fell by 11.5 percentage points to 61%. That is the lowest level since the survey began in 2013.
Japanese citizens who held negative views about South Korea fell by 7.8 percentage points to 44.6%, according to the latest poll of around 1,000 people in each country by South Korea-based East Asia Institute and Japan-based Genron NPO.
However, the deal over comfort women remains controversial in South Korea. Polls show the public is roughly equally divided on whether it provides a satisfactory settlement despite the South Korean government describing it as “final and irreversible.”
Activists in Seoul have criticized the government for not consulting the surviving comfort women before agreeing to the deal, and for not pressing Japan harder to accept formal legal responsibility for the system of forced prostitution.
A small group of student protesters broke into a news conference for the opening of the foundation, delaying it by half an hour. “Discard the agreement!” shouted one protester as she was dragged out by police. As she left the event, the head of the foundation was sprayed in the face by a protester with what appeared to be pepper spray.
The deal is also controversial because of suggestions by Japanese officials that South Korea has agreed to remove a statue of a young girl outside the Japanese Embassy in Seoul that represents a comfort woman.
“We are hoping the South Korean government will take appropriate action,” Yoshihide Suga, Japan’s chief cabinet secretary, said at a press conference on Thursday.
South Korean officials deny such an agreement was given. The statue, which still stands, is the focal point for weekly demonstrations by activists and some surviving comfort women.
—Min Sun Lee contributed to this article.
Write to Alastair Gale at email@example.com