Are better China-Japan relations on the horizon?

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Leaders of the three Asian powers, whose ties have at times been strained by territorial and historical disputes, also touched on economics, in the face of U.S. trade pressure on China and Japan.

After meeting Japanese Prime Minister Shinzo Abe, Chinese Premier Li Keqiang told journalists that better relations between Asia's two biggest economies were contributing to global stability and development.

China and Japan also plan to set up a hotline for senior military officials, which will allow for communication in case of incidents involving their respective navies or air forces.

Li is in Japan for an official visit. "Through actual behaviour, let's show that we three nations support engaging in free trade".

For his part, Abe hailed Li's remarks at their meeting on Wednesday that bilateral relations are setting sail again and will sail further.

Mitter said while there was no doubt relations between the two major East Asian powers had warmed considerably, many questions remained over how long the goodwill would last.

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China has also promised to grant Japan a 200 billion yuan (US$31.4 billion) investment quota, enabling Japanese institutional investors to buy altogether up to that amount in yuan-denominated stocks and bonds. It is the first visit by a Chinese premier in eight years.

In the political area, Li said at Thursday's reception that China and Japan have agreed that they will use history as a mirror while keeping a future-oriented mind, and maintain high-level exchanges.

"There is a danger of a new arrangement in their region in which both Japan and China have an interest without their full participation".

"Cooperation will be good for both China and Japan, as long as it's honest".

Japanese Emperor Akihito said he often recalls the moment when he was warmly welcomed by the Chinese people during his visit to China over 20 years ago, and strongly felt the hearts of the two peoples were connected. Both countries should take greater resolve and make greater efforts to increase mutual trust, build consensus and properly handle their differences so as to bring Sino-Japanese relations back to normal track and achieve new development.

Since World War II, China and Japan have had a rocky relationship, often driven apart by lingering resentment over Imperial Japan's atrocities during the war.

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