From 2004 to 2007, China and Japan held 11 rounds of negotiations, trying to settle the territory dispute. During his visit to China in late 2007, Japanese Prime Minister Yasuo Fukuda reached a four-point agreement with Primer Wen Jiabao on the East China Sea issue.

After President Hu Jintao visited Japan in May for a "warm spring" trip, significant progresses were made to settle the dispute over the East China Sea. And the latest consensus on joint exploration of the gas field is a sign of the substantial progress, which has been applauded by both sides.

The core of this consensus is that the two countries should put the territory dispute aside and cooperate for tapping the rich oil and gas reserve in the East China Sea.

The two sides decided to choose an area of 2,600 square kilometers acceptable to both, in which joint investment and exploration of the gas reserve is carried out before a demarcation plan is agreed on by the two governments.

In other words, this is an economic cooperation having nothing to do with sovereignty and the legal positions of both are not affected.

It is an initiative proposed by China that the sovereignty dispute should be put aside to facilitate the cooperation in exploring and sharing the resources.

Such a method has been utilized in the dispute between China and Vietnam over the Beibu Bay as well as that between China and the six ASEAN countries over the South China Sea.

When the disputes in the three marine areas are all solved with such transitional arrangements, China would have much bigger room in carrying out its diplomatic policies in Asia.

The strategic value of China's efforts in reaching the consensus with Japan over the East China Sea could never be overstated.

Many uncertainties and challenges are ahead for China's peaceful development. The diplomatic policies should be flexible and wise in order to make more friends for China in the international community. If China improves its ties with Japan, it would have much more leverage in its relations with other countries.

Looking in retrospect at the efforts of both China and Japan to enhance their ties, people cannot help feeling relieved at the achievement.

The author is the chief commentator with the Oriental Morning Post based in Shanghai

(China Daily June 30, 2008)