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| The National Pension Service's office in Seoul / Korea Times file |
Calls have been growing for the Korean government to restrain the National Pension Service (NPS) from investing in Japan, as the tension between the two countries has escalated since Japan's export controls.
As it turned out the pension fund has invested over 1 trillion won ($823 million) in Japanese companies involved in Japan's wartime slave labor, it has been under growing pressure to cut ties with those firms.
However, the Ministry of Health and Welfare supervising the NPS has been reluctant to restrict the investments, saying the decision should not be made hastily.
In 2018, the NPS invested 7.4 trillion won in 696 companies listed on the Japanese stock market.
According to Rep. Kim Kwang-soo of the minor opposition Party for Democracy and Peace (PDP), 75 among the 696 firms were involved in slave labor during the 1910-45 Japanese occupation of Korea. Last year the South Korean Supreme Court ordered some of these companies to compensate surviving South Korean victims of forced labor.
Kim said the NPS' investments in the 75 companies are estimated at 1.23 trillion won.
"In particular, the NPS invested 22.8 billion won in Mitsubishi Heavy Industries which has refused to compensate forced labor victims," the lawmaker said. "But its investment has had a negative return. It has suffered losses from its investment in 63 Japanese companies related to wartime forced labor."
He criticized the NPS for ignoring lawmakers, who have continued to urge it to change its stance.
The pension fund faced similar criticism during the National Assembly audit in October 2018.
Back then, NPS Chairman Kim Sung-joo admitted the pension fund's negligence, saying it would make improvements in its investments regarding the Japanese companies linked to the historical slave labor issue.
However, the NPS has continued its investment in those firms since then.
The health ministry also said it has no plans to prohibit the NPS from making such investments.
"The operation committee which will be convened in September will not discuss the matter," a health ministry official said.
"Investment in Japanese companies involved in wartime forced labor cannot be forbidden without further studies on its impact on profitability and the possibility of conflict between the two countries."
The NPS said the proportion of investment in Japanese firms that used wartime forced labor in the past has decreased, although the amount of investment has increased.
Contrary to the NPS, other pension funds have been moving to reduce their investments in Japan.
The Korea Teachers' Credit Union said Wednesday it decided to postpone its 8 billion yen ($75.4 million) investment in the Marubeni-Mizuho Capital Partners' global infrastructure fund, considering the worsening relationship between Korea and Japan.
The Government Employees Pension Service has not invested in Japanese firms and assets. The Teachers Pension has not managed a Japan-related investment portfolio either.
