Japan minister in key China talks

Mr Nikai is in Beijing for three days

Japan's trade minister Toshihiro Nikai has met Chinese Premier Wen Jiabao, in their countries' highest level contact since relations soured last October.

Mr Wen said Sino-Japanese relations had "overcome many difficulties" before.

But in a pointed comment, he said that previous progress was due to people who "correctly recognise history".

Sino-Japanese ties have been strained by rows over history and gas, as well as Japanese PM Junichiro Koizumi's visits to a controversial war shrine.

Mr Nikai's visit to Beijing raised hoped of a thaw in relations because he is seen by China as less hard-line than some of his cabinet colleagues.

Mr Wen welcomed him by saying: "I believe that today's Sino-Japanese relations have been able to overcome many difficulties and move forward because of people like you, who correctly recognise history of the two countries and actively promote friendly ties".

Shrine dispute

Despite the diplomatic strains, Japan's trade with China is at record levels, bigger even than with the US.

As well as general trade issues, Mr Nikai also continued talks begun last year on a more sensitive issue, the disputed gas fields in the East China Sea, which both countries want to exploit.

Senior Chinese officials have spurned all formal meetings with their Japanese counterparts for several months, angered by Prime Minister Junichiro Koizumi's continued visits to the controversial Yasukuni war shrine in Tokyo.

Ahead of Mr Nikai's visit, Chinese foreign ministry spokesman Liu Jianchao stressed that Beijing was still furious about Mr Koizumi's insistence on visiting the shrine, which honours Japan's war dead, including several convicted war criminals.

"On this issue, Japan should not have any illusions, make any excuses or find any pretext to cover up their acts or even push the responsibility to the Chinese side," he said.

But Mr Koizumi has made it clear that he will not be deterred from such visits, which he says he makes in a personal capacity.

According to our correspondent, the Japanese leader has made them a symbol of his determination that his country should no longer be burdened by its wartime past.

But there is growing pressure from Japan's neighbours and allies to see the rift healed.

As Mr Koizumi has said he intends to step down in September, any prospect of better relations between the region's two most powerful nations probably lies with his successor.

But the front-runner to succeed him, Shinzo Abe, has also repeatedly visited the Yasukuni shrine.