Talks on a proposed coalition government in Japan have stalled amid continuing disagreements over how to tackle the economic recession and over the role of the military overseas.

Correspondents say the ruling Liberal Democratic Party has been looking for a coalition with the Liberal Party to shore up its power base in the face of an economic crisis.

An initial agreement to work towards a coalition was made in November between the Japanese Prime Minister, Keizo Obuchi, and the opposition Liberal Party leader, Ichiro Ozawa.

The two have now agreed to meet again in early January.