Predictably, this statement has been met with ridicule, derision and alarm by many commentators. If Moon's timing and his specific point about Japan seem impractical or naive, his frustration and his long-term strategic points are easier to understand.
The Abe administration's public reasoning for announcing the new restrictions ― that it relates to distrust of South Korea's exports of sensitive materials to North Korea ― is difficult to believe.
As multiple experts have pointed out, Abe's move is more likely political. It is generally understood to be a reaction to South Korean court rulings and Cheong Wa Dae actions asserting Japan's liability for wartime forced labor from South Koreans.
Since Abe was elected prime minister, technical arrangements for settling the sex slavery and forced labor issues with Korea have been inextricably tied up with, and inseparable from, his political and ideological drive to deny or minimize Japan's responsibility for its actions in the 1930s and 1940s. His supporters' bullying and attacking journalists, academics and artists in support of that denial has regularly made news during his term.
At the same time, the two agreements Abe refers to as settling the issue were signed by Park Chung-hee in 1965 and his daughter Park Geun-hye in 2015. The former Park led a dictatorial regime, and the later Park was impeached and is now in jail.
Koreans have worked hard to drag their democracy into the 21st century, and many see the trade-offs that were part of both agreements as lacking legitimacy. In this climate, cool heads and respect for both historical realities and current and future potentials are needed in Tokyo and Seoul.
For President Moon, pressure has been mounting from his U.S. ally over North Korea policy and costs for military basing, from his North Korean neighbors over sanctions, missiles and military exercises, from his Chinese neighbors over the THAAD antimissile system and airspace violations.
Now conflicts with Japan have become urgent at the same time they are highly symbolic. On Aug. 15 Moon will deliver a much-anticipated speech commemorating Korea's liberation from Japanese colonial rule. He has reasons to be frustrated.
It is also important to remember Moon's often-stated longer-term strategic goals. Along with two previous progressive presidents, Kim Dae-jung and Roh Moo-hyun, Moon has long understood that the goal of parallel North Korean denuclearization and North-South economic cooperation is a larger and stronger peninsular economy. This is just as important as the political and security advantages that would accrue from durable agreements.
Moreover, the two Koreas are in a position to leverage their cooperation to the great advantage of China and Russia, through the linking of rail, road, communications and energy channels up the east and west coasts. Those links seem more possible now than ever, since the Moon-Kim Jong-un meeting 16 months ago and the many subsequent North-South meetings and agreements.
Less-discussed but just as economically logical is the Korea-Japan bridge/tunnel that has been studied by groups in the Japanese Diet and the Korean National Assembly for the past 30 years. Feasibility studies and engineering advances make the project highly practical today.
Political will remains the major impediment for both governments. When this project gets started, it will instantly multiply the value of all work on the East and West coast links, since having land access to the world's third-largest economy will greatly impact the two Koreas, China and Russia.
Obviously, downgrading economic cooperation between Korea and Japan is not a winning strategy in view of the common investments both will need to make in coming years.
It would be a mistake to confuse Prime Minister Abe with the Japanese state, or to assume the public supports him in his view of history. Indications are that he is not. While administrations must deal with their counterparts, a degree of sophistication in Korea's approach to Japan is absolutely necessary.
Professor David Leheny of Waseda University wrote in the Los Angeles Times recently that Japanese nostalgia is for economic growth and technological leadership, not wartime conquests. Particularly in view of the U.S. backing away from its alliance responsibilities, Japan is destined to be a closer security partner with Korea in coming years.
Many commentators will now write about South Korea's slide into the arms of the Chinese and the North Koreans, without appreciating Seoul's democratic and soft power strength. And they may also write about Japan's destiny as the lone U.S. military bastion in an imagined standoff with India against the communists.
As foolish as some of these speculations are, the behavior of U.S. President Donald Trump, his secretaries and others has encouraged them through incoherent and counterproductive policies and statements.
But like Prime Minister Abe, Trump's policies are not popular, and he is not the U.S. system. He will be gone soon enough. Both the Korea-U.S. alliance and the Korea-Japan relationship are based on fundamental common interests that will not change in the foreseeable future.
It would be best if President Moon can publicly and forcefully put a stop to spiraling anti-Japan sentiments and boycotts, even if the political retaliation from the Abe administration is painful. His instinct to ground all Korean actions in the World Trade Organization (WTO) and international authority is the right one. Bilateral diplomacy should commence quickly, and a solution to funding reparations to individuals should be found.
In terms of leading the next steps forward, Korea may feel rather lonely, considering the realities in other capitals right now. But that is not entirely a bad thing. Initiatives that address one crisis can reinforce those that address another. It may be that Korea is both well-placed and well-equipped to point the way forward.
Stephen Costello (firstname.lastname@example.org) managed the Kim Dae Jung Peace Foundation Washington office in the 1990s. He directed the Korea program at the Atlantic Council there from 1999 to 2004. He now directs AsiaEast.Org, a policy initiative focused on security, development and politics in Northeast Asia. He writes from Washington and Seoul.