Japan will continue to “patiently” pursue normalization talks with North Korea, although the two countries remain at odds on key issues, the Foreign Ministry said in its annual report released Tuesday.

The 2001 Diplomatic Blue Book mentions the resumption of normalization talks last year after an eight-year hiatus as well as a meeting in July between then Foreign Minister Yohei Kono and his North Korean counterpart, Paek Nam Sun — the first between foreign ministers from the two countries.

Despite three rounds of talks held in 2000, however, the two countries were unable to resolve differences over North Korea’s demand for compensation over Japan’s past colonial rule of the Korean Peninsula, and the alleged kidnapping of Japanese citizens by North Korean agents.

The latest round of talks were held in October — Japan also deciding in that month to provide 500,000 tons of rice to North Korea — but the two countries have so far failed to agree on when to meet again.

The ministry report praises the positive international developments involving North Korea, including the inter-Korean summit in June and Pyongyang’s establishment of diplomatic relations with some European countries.

But it says North Korean leader Kim Jong Il — although apparently making efforts to restore the economy — continues to place priority on maintaining and reinforcing the country’s military to protect its socialist system.

The annual blue book summarizes diplomatic events of the previous year, but does not include references to more recent developments.

The report says the alliance with the United States “remains the cornerstone of Japan’s diplomacy” to maintain peace and prosperity in the Asia-Pacific region, as “Japan cannot deal with all threats to peace with its limited defense capability.”

On relations with China, the report says Japan should be more selective in offering economic aid to the giant neighbor, “by clarifying important areas,” citing public unease toward maintaining large-scale aid to China amid its rapid economic growth and sharp increases in military spending.

In the report, the ministry reiterated an apology for the fraud scandal involving a former official in charge of logistics for VIP overseas trips.

“The Foreign Ministry is painfully aware of its responsibility for failing to prevent such an incident,” the report says, referring to a lack of checks for the handling of public funds allocated for diplomatic purposes.

In the scandal, which broke around the beginning of this year, Katsutoshi Matsuo is suspected of using secret diplomacy funds for personal use when he headed a ministry division supporting prime ministerial visits abroad.

Matsuo, 55, who was dismissed from the ministry in late January, was indicted by prosecutors in late March.

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