Photo/Illutration Visitors take in a display at the Sado Kinzan Gold Mine site in Sado, Niigata Prefecture, on Nov. 23. (AP Photo/Eugene Hoshiko)

SADO, Niigata Prefecture--Japan was set to go ahead with a memorial ceremony Sunday near the Sado Island Gold Mines, despite South Korea’s last-minute boycott of the event that highlighted tensions between the neighbors over the issue of Korean forced laborers at the site before and during World War II.

South Korea’s absence at Sunday’s memorial, to which Seoul government officials and Korean victims’ families were invited, is a major setback in the rapidly improving ties between the two countries, which since last year have set aside their historical disputes to prioritize U.S.-led security cooperation.

The Sado mines were listed in July as a UNESCO World Heritage site after Japan moved past years of disputes with South Korea and reluctantly acknowledged the mines’ dark history, promising to hold an annual memorial service for all victims, including hundreds of Koreans who were mobilized to work in the mines.

On Saturday, South Korea announced it would not attend the event, saying it was impossible to settle unspecified disagreements between the two governments in time.

Masashi Mizobuchi, an assistant press secretary in the Foreign Ministry, said Japan has been in communication with Seoul and called the South Korean decision “disappointing.”

The ceremony will be held as planned later Sunday at a facility near the mines.

The 16th century mines on the island of Sado, off Japan’s north-central coast, operated for nearly 400 years before closing in 1989 and were once the world’s largest gold producer.

Historians say about 1,500 Koreans were mobilized to Sado as part of Japan’s use of hundreds of thousands of Korean laborers, including those forcibly brought from the Korean Peninsula, at Japanese mines and factories to make up for labor shortages because most working-age Japanese men had been sent to battlefronts across Asia and the Pacific.

Japan’s government has maintained that all wartime compensation issues between the two countries were resolved under a 1965 normalization treaty.

South Korea had long opposed the listing of the site as World Heritage on the grounds that the Korean forced laborers, despite their key role in the wartime mine production, were missing from the exhibition. Seouls backing for Sado came as South Korean President Yoon Suk Yeol prioritized improving relations with Japan.

The Japanese government said Sunday’s ceremony was to pay tribute to “all workers” who died at the mines, but would not spell out inclusion of Korean laborers--part of what critics call a persistent policy of whitewashing Japan’s history of sexual and labor exploitation before and during the war.

Preparation for the event by local organizers remained unclear until the last minute, which was seen as a sign of Japan’s reluctance to face its wartime brutality.