Japan-China trade row lives on

Japan will lift emergency curbs on imports of three Chinese agricultural products on Friday, as a temporary goodwill gesture while talks continue.

But the two countries failed to resolve their wider trade row at talks in Tokyo.

Japan has agreed to put off moving to a four-year limit on imports of the three items until 21 December.

More negotiations to solve the dispute could take place as soon as next week, Japanese officials said.

Meanwhile new tensions over trade relations in north east Asia are simmering after China signed an agreement to set up a giant free trade zone with Asean, the Association of South East Asian Nations.

Feeling left out

The pact has been greeted with caution in both Japan and South Korea.

South Korea's deputy prime minister, Jin Nyum, said "more co-operation" was needed between China, Japan and Korea, according to the Financial Times newspaper.

The head of Keidanren, Japan's biggest business association, said "there is a limit to what they (China and Asean) can do" without the participation of Japan and South Korea.

"Any economic system without the participation of Japan and South Korea cannot grow," said Takashi Imai, chairman of Keidanren and Nippon Steel.

Japan and South Korea will get the chance to sign up for the new pact, but not till next year.

New talks

Japan is pushing for an early start to new negotiations in the farm products dispute and is "hopeful" of a solution, said Cabinet Secretary Yasuo Fukada.

Until a solution is reached, China's retaliatory 100% tariffs on imports of Japanese cars, air conditioners and mobile phones will remain in place.

"It would be better (for China) to proceed without prerequisites," said Mr Fukuda.

Trade relationship

Trade between the two countries was worth $83bn last year

Chinese agricultural goods affected are worth $100m

Japanese goods that could be affected are worth $700m

The dispute centres on Chinese exports of three items - shiitake mushrooms, leeks and rushes for tatami mats that cover the floors of traditional Japanese homes.

Trade in these items, and the industrial products that China has moved against, forms a relatively small part of trade between the two countries.

Japan's small farmers are struggling and analysts view the curbs as a way of protecting their domestic farming industry.

A Keidanren spokesman said the government "should not have imposed the temporary safeguard measure to begin with".

Business representatives are taking part in negotiations to resolve the dispute.

China is preparing to be welcomed into the World Trade Organisation at the Doha, Qatar, summit within days.