May 3, 2023: On Tuesday, Japan and South Korea are holding their first bilateral finance leaders’ discussion in seven years. A sign relation between the two is thawing as they confront geopolitical tensions and decreasing economic growth challenges.

The two countries are starting regular finance dialogue “at a proper timing,” Japanese Finance Minister Shunichi Suzuki told reporters after the discussion.

The dialogue will likely hold on an annual basis, Suzuki stated.

The resumption of bilateral financial discussions comes after Japanese Prime Minister Fumio Kishida’s talked to visit South Korea next week for discussions with President Yoon Suk Yeol.

“Japan and South Korea are proper neighbours that must cooperate to address various challenges which surround the global economy and the regional and international community,” Suzuki stated at the meeting with his South Korean counterpart Choo Kyung-ho.

“As for geopolitical challenges, we’re undergoing incidents like North Korea’s nuclear missile growth and Russia’s invasion of Ukraine. Japan sees these as not permitted and something the two places must address together,” he stated.

Choo stated that the two countries could strengthen private and administration partnerships in high-technology industries like semiconductors and batteries.

In the meeting starting on the sidelines of the Asian Agreement Bank gathering this week, Choo urges Japan to swiftly restore South Korea to an “allowlist” of countries with fast-track trade status.

Choo is anticipated to visit Japan this year for one more meeting with Suzuki, South Korea’s finance ministry stated.

Regular annual dialogue between both the countries finance ministers has been discontinued since 2016 because of disputes regarding wartime history.

But ties among the U.S. allies have improved recently due to North Korea’s missile launches and China’s muscular role on the international stage.

In a landmark summit in Tokyo in the previous month, Kishida and Yoon agreed to put aside their complex shared history. They pledged to work together to counter regional security challenges.

Suzuki said he wishes Japan and South Korea could continue with bilateral fiscal dialogue and that doing so would improve relations between the two countries.