President Moon Jae-in proposed Sunday that South and North Korea "institutionalize" peace on the peninsula and create a Germany-style trust-building system toward the longer-term goal of unification.

"Firmly institutionalizing peace on the Korean Peninsula will definitely benefit both Koreas greatly," Moon said during his Liberation Day speech to commemorate the 76th anniversary of Korea's liberation from Japan's colonial rule.He described division as the biggest obstacle blocking "growth, prosperity and permanent peace," saying the two Koreas can take lessons from Germany.

The two sides also can remove the barrier and create a "Korean Peninsula model," in which they coexist and contribute to the prosperity of Northeast Asia, although unification may take some more time, he stated.

"Most of all, the advantages that the Republic of Korea can enjoy will be enormous once we shake off the so-called Korea discount and connect to the continent rather than exist as a virtual island nation," he added. "If we tirelessly envision peace on the Korean Peninsula, our imaginations can reach beyond it and spread across Eurasia. If we do not stop striving for reconciliation and cooperation, that tenacious barrier will finally crumble and new hopes and prosperity beyond our dreams will begin."

This year marks the 30th anniversary of the two Koreas' joint accession to the United Nations, a year after East and West Germany achieved unification after 45 years of division, the president noted.

He reiterated a request for North Korea, as a member of the "East Asian community of life", to join the Northeast Asia Cooperation Initiative for Infectious Disease Control and Public Health, especially as cross-border cooperation has become more important amid the COVID-19 pandemic.

Moon's remarks came as North Korea is strongly protesting at the annual combined military exercise between South Korea and the United States.

In his last Liberation Day address as president, however, he stopped short of making specific overtures, including those on a push for another round of summit talks with the North's leader Kim Jong-un. Moon's single five-year tenure ends in May 2022.

On Japan, he made clear again that his government "always" leaves the door open for dialogue.

"For historical issues that need to be rectified, we will resolve them through actions and practices that are consistent with universal values and the standards of the international community," he said. "I look forward to our two countries gathering wisdom and surmounting difficulties together, setting an example of the cooperation expected between neighbors."

Meanwhile, Moon reaffirmed a pledge to overcome the ongoing fourth coronavirus wave here, fueled by the spread of the delta variant, without fail.

"In October, 70 percent of the total population will have received their second shots, and vaccination rate targets will be raised once more," he said.

The government launched its COVID-19 vaccination campaign in February and it aims to offer at least the first dose of vaccine shot to 36 million people, or 70 percent of its 52 million population, by September.

Moon's 25-minute televised speech focused largely on South Korea' future vision, with the words "dream" and "world" each used more than a dozen times.

He said that South Korea will become a "vaccine hub," further enhance its role in the global supply chain of such key industries as semiconductors and batteries and fulfill its responsibilities in tackling the climate crisis.

The annual ceremony was held at Culture Station Seoul 284 in central Seoul, a historic site symbolic of Korea's fight against Japan's colonization from 1910-45. (Yonhap)