Japan, Russia Agree to Revive Talks on Island Dispute

MOSCOW (Reuters) -

Russia and Japan said on Monday they would revive talks on resolving a territorial dispute that has prevented them signing a treaty formally ending their World War II hostilities, and, wary of China’s rising influence, agreed to bolster trade ties.

At the two G8 powers’ first Moscow summit for 10 years, President Vladimir Putin and Prime Minister Shinzo Abe had China’s economic and political might in mind as they launched a new effort to warm up their relationship.

An end to the dispute over four Pacific islands is not in sight, but reviving long-stalled talks is a first step to improving economic cooperation, which both sides say has failed to live up to its potential.

“We have agreed to revive talks [on the islands],” Putin told a news conference with Abe after a Kremlin ceremony at which about 20 economic cooperation agreements were signed, but said this did not mean the issue would be resolved “tomorrow”.

Abe acknowledged the sides were far apart over the islands but hailed the decision to instruct foreign ministers to resume talks as an important move to end an “abnormal” situation.

Looking relaxed in talks with Putin in an ornate Kremlin hall, Abe said bilateral trade had grown eightfold in the 10 years since then-Prime Minister Junichiro Koizumi held a summit with Putin in Moscow.

“Nevertheless, our potential for cooperation has not been opened wide enough,” Abe said.

Underlining this, the sides failed to clinch any major deals on energy cooperation.

But Abe said closer ties and more trade would “also make a contribution to the stability and prosperity of our region and the world as a whole.”