Japan and North Korea say expect progress on ties

TOKYO, Sep 5 (Reuters) Japan and North Korea expressed guarded optimism as they began talks in Mongolia today on establishing diplomatic ties, after Washington and Pyongyang appeared to move forward in similar discussions at the weekend.

The simmering row over the fate of Japanese people abducted by North Korean agents decades ago -- the resolution of which Tokyo has made a condition of normalising ties -- stalled the last round of bilateral discussions in Hanoi in March.

But Japan has said it expects results this time and has mentioned it is considering offering aid to victims of recent flooding in North Korea in what would be the first such friendly gesture since Prime Minister Shinzo Abe came to office a year ago.

Bilateral talks are one of the building blocks in a six-party process also involving China, South Korea and Russia, aimed at persuading Pyongyang to abandon its nuclear weapons.

''Given that there appears to be some forward movement in the six-way talks, we would be pleased to see some progress in the Japan-North Korea talks,'' Japanese Foreign Minister Nobutaka Machimura told reporters in Sydney, where he was attending Asia-Pacific regional talks, today.

The chief North Korean delegate to the talks also told reporters yesterday he expected progress this week.

''I have expectations that there will be results,'' Kyodo news agency quoted Song Il-ho as telling reporters in Pyongyang yesterday.

''As the atmosphere of the six-party talks is positive overall, relations should also move forward in line with that,'' the agency quoted him as saying later in Beijing.

US-JAPAN GAP Japan will be anxious to have some results to show this week, analysts say, because bilateral progress between the United States and North Korea on the core nuclear issue could otherwise isolate Tokyo, which relies on the US nuclear shield for protection.

North Korea's claim that Washington had agreed to remove it from a list of countries it says sponsors terrorism, though later denied by the United States, likely sparked concern in Tokyo, said Robyn Lim, professor at Japan's Nanzan university.

''The gap between the United States and Japan over North Korea is clearly growing,'' Lim said.

Japan insists it cannot normalise relations without resolving the abduction issue and has urged the United States not to strike North Korea from the list or lift the associated sanctions until the abductees are accounted for.

Pyongyang admitted in 2002 to kidnapping 13 Japanese citizens in the 1970s and 1980s to help train its agents.

Five have since returned to Japan, but North Korea says the others are dead and has so far insisted the issue is closed and is demanding compensation from Japan for its sometimes brutal 1910-1945 colonisation of the Korean peninsula.

Japan is pushing for more information and the return of any other survivors -- a pet issue for Abe, who made his name by taking a hard line on the issue.

In what appeared to be an attempt to show flexibility, the Japanese delegation agreed today to address Japan's atonement for colonisation before discussing the abductions, Kyodo news agency said.

Tokyo would consider setting up a committee to look into compensation if Pyongyang agreed to re-open the kidnapping investigation.

Japan paid hundreds of millions of dollars under a 1965 agreement normalising relations with South Korea, and analysts say an equivalent sum will likely be required to establish ties with the North.

But making such a payment would be politically difficult while the fate of the abductees remains unclear.

REUTERS CS DS1145