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Japan and China agree to bolster economic cooperation amid trade war

This combined photo shows Chinese Finance Minister Liu Kun, right, and his Japanese counterpart Taro Aso holding talks at the Diaoyutai State Guesthouse in Beijing, on Aug. 31, 2018. (Kyodo)

BEIJING (Kyodo) -- The finance ministers of Japan and China agreed Friday to bolster economic cooperation amid growing concern that an escalating trade war waged by U.S. President Donald Trump will continue to rattle global financial markets.

Japanese Finance Minister Taro Aso and his Chinese counterpart Liu Kun also confirmed that their two countries will make efforts to "maintain and promote the multilateral trade system," a joint statement issued after their talks in Beijing said, warning against Trump's protectionism.

At the outset of a meeting between Aso and Liu, the Japanese finance minister said the economies of both countries are "in an important phase."

According to the statement, released following the seventh Japan-China financial dialogue, Tokyo and Beijing agreed to "play a key role" in cooperation on macroeconomic policy, poverty reduction, regional economic growth and financial stability.

Aso, doubling as deputy prime minister, expressed willingness to improve Japan-China relations further ahead of a planned visit by Japanese Prime Minister Shinzo Abe to China, possibly in October.

The Japanese and Chinese finance chiefs "had talks in the best atmosphere" since Abe's government was launched in December 2012, Aso told reporters later Friday.

In May, Japan and China agreed to resume their currency swap arrangement in times of financial emergency, while Beijing promised to grant Tokyo a 200 billion yuan (about $29 billion) investment quota in yuan-denominated stocks and bonds.

During their meeting on Friday, Aso and Liu exchanged views on how to move ahead with economic and financial cooperation between their two nations.

Officials from the finance ministries and central banks of the two neighbors joined the dialogue, which was last held in May 2017 in Yokohama. Those from financial services agencies of the two countries also participated in it for the first time.

Tokyo and Beijing will make final arrangements to facilitate the announcement of concrete agreements in the financial field at an envisioned summit between Abe and Chinese President Xi Jinping, Aso said.

Aso added he agreed with Liu that the eighth Japan-China financial dialogue will be held in Japan next year.

In recent years, Sino-Japanese ties had been mired in a territorial row over the Senkaku Islands -- Japanese-administered uninhabited islands, called Diaoyu in China, in the East China Sea.

Tensions escalated especially after the Japanese government led by then Prime Minister Yoshihiko Noda, Abe's predecessor, effectively put them under state control in September 2012.

But bilateral relations have been improving, with both sides reflecting positively on the 40th anniversary this year of the signing of a friendship treaty between the two countries.

On the back of the improvement in ties, Toshihiro Nikai, secretary general of Abe's Liberal Democratic Party, is also visiting China this week.

Nikai, who arrived in Beijing on Wednesday, held talks Friday with Chinese Vice President Wang Qishan and Foreign Minister Wang Yi.

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