This article in The Diplomat really articulates why Japan and South Korea are having their current bitter trade dispute:
To understand why a free trade-dependent, rules-upholding country is apparently willing to undermine the rules of free trade with one of its most important trading partners, it may be useful to divide rules, norms, laws, treaties – the “stuff” of international order – between the content of what they regulate, e.g. trade, and the attributes that make them meaningful, e.g. mutual acceptance, reliability, and finality. In an ironic twist, Japan is using a particular subset of international rules, norms, laws, and treaties (specifically regulating trade) to fight for a common understanding that rules, norms, laws, and treaties (but especially those concerning historical issues) ought to be mutually accepted, reliable, and final once signed.
Even if the agreement reached in years or decades prior is not the preferred agreement of the current generation, there needs to be an acceptance of those agreements as constituted. Perhaps the only silver lining in all of this is that a liberal president rules in South Korea and a conservative prime minister leads Japan — “To forge an enduring deal,” Glosserman emphasizes, “this combination is what you need.” After having been burned twice – once after reaching an agreement with a dictatorship and once after reaching an agreement with a democratically-elected conservative administration – an agreement reached with a democratically-elected liberal administration may have greater weight in Japanese estimations of its future durability. But as Japan has abided by (would have abided by) these past agreements, Tokyo wants to see the initiative for another attempt come from South Korea.
Japan’s trade restriction on exports to South Korea is not Tokyo’s optimal policy, and it is not a long-term solution to Japan’s historical issues with South Korea. It is a desperate attempt by one country trying to get its valuable economic and security partner to commit to putting the relationship of today and the relationship of the future ahead of the issues of the past.
The Diplomat
You can read the rest at the link, but it is clear that the Japanese government’s patience has reached its limit on the ROK government backing out on signed deals that a new administration does not like.
With that said I don’t know how President Moon can back down now considering how strongly he has pushed anti-Japanese sentiment for domestic political purposes since he was elected. This leads me to believe this could drag on for quite some time.