Source: This report being compiled by Roger Smith - DTN News from reliable source including ReutersSino-Japanese relations deteriorated sharply last month after Japan detained a Chinese trawler captain whose boat collided with Japanese patrol ships near the disputed islands -- called Senkaku in Japan and Diaoyu in China.
Japanese Prime Minister Naoto Kan has come under fire domestically for appearing to cave in to Chinese demands to release the captain. On Saturday, thousands marched in Tokyo to assert Japan's claim to the rocky isles, which are near potentially huge oil and gas reserves in the East China Sea.
"Regarding the Chinese protests against Japan on the 16th and 17th, we will tell the Chinese authorities that it is regrettable and ask them to ensure the safety of Japanese nationals and Japanese companies in China," Kan told a parliamentary panel.
"Both sides need to work hard (on the matter) in a calm manner," Kan added. Chief Cabinet Secretary Yoshito Sengoku said Japan had already conveyed its message to Beijing.
The feud has raised concerns about fallout for business given deep economic ties between the two Asian giants. China replaced the United States as Japan's biggest trade partner last year.
China canceled diplomatic meetings in protest over the trawler captain's detention, and concerns have been simmering that Beijing is holding back shipments of rare earth minerals that are vital for electronics goods and auto parts.
"The countersteps that China has taken are extremely hysterical," Maehara said.
"When it comes to rare earth (export stoppages), while China's commerce ministry is denying any such steps, things have not really returned to normal yet, creating a situation that does not fit well with the spirit of the WTO (World Trade Organization)."
On Sunday, China called on its people to stay within the law in their "understandable" anger at Japan.
An estimated crowd of 2,000 gathered in downtown Chengdu, capital of China's southwestern Sichuan Province, from early afternoon on Saturday, unfurling banners and shouting: "Defend the Diaoyu Islands," "Fight Japan" and other slogans.
In Tokyo on the same day, more than 2,000 protesters marched to the Chinese Embassy, waving flags and chanting in opposition to China's claim to the uninhabited islands.
Sino-Japan ties have long been plagued by China's bitter memories of Tokyo's past military aggression, rivalry over resources and mutual mistrust about military intentions.
But relations had until recently been improving after deep strains sparked major anti-Japan protests in China in 2005.
Japan and China are trying to arrange a formal summit meeting between the two countries' leaders at the end of October on the sidelines of a regional summit in Vietnam.
Kan and Chinese Premier Wen Jiabao both called for better ties at an informal meeting in Brussels earlier this month, but they also stressed their claims to the uninhabited islands.
(Reporting by Kiyoshi Takenaka, Writing by Linda Sieg; Editing by Edmund Klamann and Chris Gallagher)
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