UPDATE 2: Russia–Japan peace treaty should prevail over economy – Putin

(Adds details in paragraph 10)

TOKYO, Dec 16 (PRIME) -- A peace treaty between Russia and Japan should prevail over trade and economic issues as it will create conditions for long-term cooperation, Russian President Vladimir Putin said in a news conference with Japanese Prime Minister Shinzo Abe on Friday.

Moscow and Tokyo have still not signed a peace treaty after the Second World War ended as Japan insists that Russia return four of the Kuril Islands – Iturup, Kunashir, Shikotan, and Habomai – which Russia received after the war.

“If anyone thinks that we are only interested in setting up economic ties while putting the peace treaty into the background, they are wrong. I think that the signing the peace treaty is the most important thing, as it creates conditions of long-term cooperation from the historic point of view for us, in the mid-term and long-term. This is more important than activity on the islands,” Putin said.

But Russia and Japan still should team up in the development of their economies to improve competitiveness, he said.

The Kuril Islands may become a link between Russia and Japan.

“If we take the right steps in the direction of a plan offered by the prime minister, who suggested creation of a separate company for economic activity on the islands, signing an intergovernmental agreement, working out a mechanism for cooperation, and definition of conditions that will allow us to sign the peace treaty on this basis,” he said.

Russia and Japan now have a chance for detailed cooperation talks. “Now there is a chance for more detailed negotiations of trade and investment cooperation with participation of representatives of governments and business as well,” he said.

Joint work of the two countries in the economy will create the basis for development of relations. “Economies of Russia and Japan are complementary and contradictions are practically nonexistent,” he said.

During the meeting, Putin and Abe ordered ministries to work out new agreements in the investment, trade and labor spheres, Putin added.

A free-trade zone between Japan and the Eurasian Economic Union (EAEU) – comprising Russia, Belarus, Kazakhstan, Armenia and Kazakhstan – can be created and it will be discussed at the expert level very soon, he said.

Abe said he plans to visit the Eastern Economic Forum in the city of Vladivostok which is scheduled for September 2017.

During Putin’s two-day visit to Japan, companies of the two countries signed 68 memorandums and agreements, including independent gas producer Novatek signing memorandums with Marubeni Corporation, Mitsubishi Corporation, and Mitsui Corporation.

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