These events demonstrate that the toxicity of a long-running historical dispute has seeped into the security and economic realms. Bilateral ties between the two countries are shadowed by the legacy of Japan’s brutal colonisation of the Korean Peninsula and conscription of sex slaves and wartime labour. Seoul accuses Tokyo of not properly atoning for its wrongdoings, while Tokyo claims South Korea keeps moving the goalposts in spite of many expressions of contrition from Japanese leaders.

Tokyo’s recent action was triggered by the South Korean Supreme Court’s order to seize certain Japanese companies’ assets to compensate Koreans who claimed they were forced into labour during World War II. To justify the export curbs, Japanese Prime Minister Shinzo Abe said ‘with regard to the wartime-labourers issues, it has become clear that South Korea does not abide by international commitments. It is natural to assume that it also fails to keep promises on export control’.

Experts are pointing fingers at the Trump administration, whether for its disinterest in getting involved or for providing a model for Japan’s wielding of economic cudgels as retaliation. Others are pointing to Tokyo’s ‘growing revisionism about the past’ and unwillingness to make amends for its harsh treatment of Koreans. Others still argue that the current South Korean administration wants to unravel the previous government’s agenda, including its rapprochement with Japan.

Another reason involves North Korea and the politics and passions of reunification. Deeply invested in reconciliation with North Korea and cultivating a ‘peace economy’, South Korean President Moon Jae-in’s numerous speeches expose the lingering scars of colonisation and division in the South Korean mind. They also show how he sees the arc of the pan-Korean struggle, victory and unity as having been thwarted by Japan and its Korean collaborators.

Daniel Sneider has argued, ‘these are not so much issues of monetary compensation to individuals, they’re profound issues of identity’. Sociologist Gi-wook Shin is blunter — he argues ‘this is nothing less than the head-on collision of right-wing Japanese nationalism and left-wing South Korean nationalism’.

The answer to the question of how things got so bad: ‘all of the above’. The longstanding historical grievances are fuelled by a progressive South Korean president who prioritises engagement with an uncompromising North Korea over increasing security and economic ties with Japan, the tenure of a conservative Japanese prime minister who has a track record of insensitive remarks about his country’s wartime legacy, the perceived retreat of the US commitment to the region and an unconventional president in Washington who openly derides alliances.

The personal antipathy between Moon and Abe also aggravates the situation, dampening prospects for resolution. This convergence of factors has created an environment in which the Japan-South Korea relationship is festering, despite the logic of cooperation.

There are a few possible developments that might prompt Seoul and Tokyo to break the logjam.

First, business leaders offer a ray of hope. As Katrin Katz suggests, Moon and Abe could quietly empower business groups — who have the most to lose from boycotts and export curbs — to mitigate the damage by establishing channels of dialogue and finding ways to de-escalate tensions. After an initial postponement of the trade row, the Korea–Japan Business Conference convened its annual meeting on 24 September 2019, suggesting that leaders from both countries are taking proactive steps to ameliorate the situation.

The second potential scenario involves North Korea. While Japan has been left out in the flurry of summitry with North Korea’s Kim Jong-un, in part because of Tokyo’s hard line stance on the abduction issue and denuclearisation, Abe said in May 2019 that he would be open to a meeting with Kim.

North Korean media in mid-September publicised the visit of a Japanese delegation led by Shingo Kanemaru, a son of the former deputy prime minister Shin Kanemaru who had met with Kim’s grandfather, Kim Il Sung. If there is significant progress on North Korea–Japan ties, Moon — who has been stiff-armed by Kim for months — might seek to engage with Abe to avoid being sidelined on North Korea issues.

The third scenario is dependent on an external actor. Nothing brings the two neighbours together like a blustery, aggressive North Korea. Moon’s predecessor Park Geun-hye sought to improve ties with Japan to bolster cooperation on the North Korea threat. Tokyo and Seoul might be compelled to work together if Pyongyang decides to scrap its summitry and resume its belligerent rhetoric and nuclear testing. In this case, Washington is likely to insist on stronger trilateral cooperation, providing an off-ramp for the two sides to set aside their differences.

The Tokyo 2020 Olympics also provide a potential opening, even though the two countries are currently sparring over Tokyo’s use of the ‘Rising Sun’ flag, which Seoul says represents Japanese imperialism and elicits ‘historical wounds and pains’. But seeking to avoid any diplomatic rows or controversy to ensure a successful event, Abe might soften Japan’s approach to South Korea in the coming months. Moon may reciprocate, driven by his desire to have joint Korean teams at the games.

While these scenarios do not provide long-term solutions that would resolve the sticky issue of history that plagues bilateral ties, they do offer a reminder that the two countries’ interests and futures are deeply intertwined.

Jung H Pak is a Senior Fellow and the SK–Korea Foundation Chair in Korea Studies at the Brookings Institution.