South Korea on Wednesday announced it would shut down a foundation created under the country’s 2015 agreement with Japan to help Korean women who were used as sex slaves during World War II, The New York Times reported.

Though South Korea has not formally cancelled the deal, it has effectively put the agreement on hold by shutting down the Reconciliation and Healing Foundation that was in charge of implementing it.

The dispute over the “comfort women”, a euphemism for tens of thousands of Korean women and girls coerced into working in Japanese military brothels during Tokyo’s colonial rule over South Korea from 1910 to 1945, has strained ties between the countries for decades.

Japan insists all compensation claims arising from the war were settled during a bilateral peace treaty signed in 1965. In 2015, it apologised to the surviving victims and provided them 1 billion yen (approximately Rs 63.06 crore) to help heal their “psychological wounds”. Surviving victims and activists, however, deemed the deal humiliating and expressed their unhappiness with Japan’s refusal to accept formal and legal responsibility for the wartime excesses.

South Korea contends that President Moon Jae-in’s conservative predecessor failed to secure adequate measures to meet the women’s needs.

Since the 1990s, 239 women, out of thousands, have come forward to say they were forced into the trade. Only 27 of them are reportedly still alive. The foundation has paid about $3.8 million (about Rs 27 crore) to 34 people, including some surviving women as well as relatives of the victims who have died. Moon’s government has reportedly reimbursed the foundation for these payments, and may send back Japan’s contribution.

“We will try our best in setting up policies to recover the honour and dignity of the victims,” South Korea’s Ministry of Gender Equality and Family, which managed the foundation, said while announcing the decision. “We have…decided to end the project based on the result of our reviews and current circumstances around the foundation.” The foundation “did not sufficiently reflect” the opinions of the women, The Guardian quoted the ministry as saying.

Japanese Prime Minister Shinzo Abe reacted with anger. “The agreement made three years ago was the final and irreversible resolution,” he said. “Japan, as a member of the international community, has honestly executed this pledge. If one country cannot keep an international pledge, a bilateral relationship cannot be built.” Japan has summoned the South Korean ambassador to explain the move.