"China and Japan are close neighbors and important countries in Asia," Tang said. "Although external and domestic environments have changed in both countries, the importance of Sino-Japanese ties has been further enhanced, not weakened.

"China and Japan share a wide range of common interests and have good prospects for future cooperation. It is important to settle all existing problems between the two countries in a proper way, which will help secure smooth development of bilateral relations in the next stage."

Reiterating China's position on historical problems between the two countries, including the latest tiff about some Japanese politicians' visit to the Yasukuni Shrine, Tang said such problems affect bilateral relations at the most fundamental level.

"The Japanese should understand that these problems are very sensitive and could have severe consequences," Tang said. "Japan should avoid actions that could hurt the feelings of people in countries that have fallen victims to Japan's war crimes."

Tang said the Chinese Government and people treasure the progress made in bilateral ties so far.

Kawaguchi said Sino-Japanese relations are important. Japan is willing to further enhance mutual understandings between the two countries.

She said she understood the importance and sensitivity of the historical problems affecting bilateral relations and is willing to work to solve them appropriately.

(China Daily July 31, 2002)