World Bulletin / News Desk
The statue was erected by a civic group late last month after a district office announced that it would no longer object to the monument to “comfort women” -- a euphemistic term referring to thousands of victims of sexual slavery at the hands of Japan, which ruled over the peninsula from 1910 to 1945.
On Friday, Japan's Chief Cabinet Secretary Yoshihide Suga told a press conference that Tokyo would recall Yasumasa Nagamine and its consul general in Busan, Yasuhiro Morimoto, halt talks on a planned currency swap and put off high-level economic dialogue as part of an "initial" response.
"We have repeatedly asked South Korea to handle the resolution of this issue appropriately, but the situation has not improved, so we have taken this action," Yonhap news agency reported Suga as saying.
He added that the new statue is "extremely problematic" considering a December 2015 agreement, under which Japan promised to pay 1 billion yen ($8.5 million) through a foundation to support now elderly Korean sexual slavery victims, just 39 of whom are still alive and registered with the government.
The statue depicts a girl in traditional Korean clothing seated on a chair, with an empty chair beside her, and is of the same design as statues erected outside Japan's embassy in Seoul and in several locations overseas.
On Friday, South Korea's Foreign Ministry criticized Japan's response as "extremely regrettable".
"The government emphasizes once again that both countries should continue to develop South Korea-Japan relations, based on a relationship of trust between the governments, even if there are difficult issues," the ministry said in a statement.