Japan has set itself on a diplomatic collision course with South Korea by applying for Unesco world heritage status for gold and silver mines on an island off its west coast which used forced labour from Korea.

The row over the mines – on Sado island in the Sea of Japan – is expected to further sour relations between the countries just as the US is pressing them to present a united front against North Korea’s nuclear programme.

The mines are among dozens of industrial sites that played a key role in Japan’s modernisation but relied on slave labour. An estimated 780,000 Koreans worked in mines and factories during Japan’s 1910-1945 colonial rule of the Korean peninsula, many in appalling conditions and without proper pay or holidays.

Japan’s prime minister, Fumio Kishida, nominated the mines this month after pressure from conservatives in his party including former prime minister Shinzo Abe. This drew an angry response from South Korea, whose foreign ministry accused Japan of “ignoring the painful history of forced labour for Koreans”.

Kishida said: “We are aware that South Korea has its own opinions. That’s why we feel we should have meaningful, rational dialogue.”

In recent years, groups of former labourers and their families have attempted to win compensation from Japanese companies including powerful conglomerates such as Nippon Steel and Mitsubishi Heavy Industries. But South Korean court rulings finding for the plaintiffs have been dismissed by Japan, which maintains that compensation claims stemming from the war were settled “completely and finally” by a 1965 bilateral treaty.

Companies that do not comply with the rulings risk having their assets in South Korea seized – a move observers say would harm the economies of both countries.

The 400-year-old Sado mine complex, which closed in 1989, was once among the world’s biggest gold producers, but its success was partly built on the exploitation of more than 1,000 Korean labourers.

In an editorial, the Korea Herald called the Unesco proposal “shameful”, adding: “Japan’s move to list the site … is a thinly veiled to attempt to whitewash the brutality that took place during its rule of Korea. For Koreans, the Sado mine is one of many sites illustrating the atrocities of Japanese colonialism amid the long-running view that Japan has yet to issue a sincere apology and offer proper compensation.”A Unesco advisory body will survey the complex and decide whether to include it in the list of heritage sites – a status that would encourage tourism and attract funds for protection and conservation. The World Heritage Committee, which includes Japan but not South Korea, will make a final decision next summer.

Japan has faced charges of attempting to ignore dark episodes from its past before: more than 20 Meiji era (1868-1912) industrial sites were added to Unesco’s world cultural heritage list in 2015. Although some of these places, including a coalmine on Gunkanjima island, had used forced labour, Japan was admonished by Unesco for failing to honour a commitment to explain that their workforces had included thousands of exploited Koreans. Local government descriptions of the Sado mines do not mention their use of Korean labourers.

Ties between South Korea and Japan are at their lowest level for years amid disputes over forced labour and “comfort women” – girls and women, mainly from the Korean peninsula, forced to work in Japanese military brothels before and during the war.

The US has called on leaders in Seoul and Tokyo to resolve the row and focus on addressing threats posed by a more aggressive China and an unpredictable North Korea.