Beijing (AsiaNews/Agencies) - China and Japan have agreed on "diplomatic talks" over disputed islands in the East China Sea, called Diaoyu by the Chinese and Senkaku by the Japanese. Officials in both governments have been increasingly concerned about the economic consequences of the row on bilateral economic relations since August. Yesterday, Japanese Prime Minister Yoshihiko Noda said that without talks, "Both countries lose out."
The chain of islands has been at the centre of a fierce territorial dispute for years. Although their economic potential has not yet been determined, they are thought to be rich in natural gas and perhaps oil. They are also geo-strategically important.
The row "will have a number of mostly negative economic effects over the medium term," Moody's Analytics said in a report today.
The International Monetary Fund (IMF), which is currently meeting in Tokyo, criticised the intransigence of both governments. IMF Managing Director Christiane Lagarde warned the two countries to settle their dispute or the world economy will suffer as a whole.
Both Tokyo and Beijing chose to ride a wave of popular resentment that followed a series of bilateral provocations over the islands.
Tens of thousands of people in China attacked Japanese-owned plants and businesses, forcing them to shut down and lay off workers.
Talks between deputy ministers are meant to overcome the impasse.