China releases 3 Japanese; fourth still held

BEIJING (Reuters) - China released three Japanese citizens whose detention had stoked tensions between Asia's two top economies, but a fourth remains in custody, Xinhua news agency reported on Thursday.

Japan's Foreign Minister Seiji Maehara demanded the remaining Japanese being held be released quickly.

The release of three of the Japanese employees of Fujita Corp, detained on suspicion of entering a restricted military zone, comes after signs that Beijing and Tokyo are moving past the most vehement phase of their latest friction.

The three acknowledged "having violated Chinese law and showed regret for their mistake," Xinhua said.

Xinhua gave no more information about the fourth Japanese citizen, Sada Takahashi, nor about a Chinese national also being held.

The Fujita employees were detained in northern China's Hebei province last week while Beijing and Tokyo were embroiled in a territorial row sparked by Japan's detention of a Chinese fishing boat captain in disputed seas.

They were in China for a project to dispose of chemical weapons abandoned there by the Japanese military at the end of World War Two.

Japanese authorities released the boat captain late last week, but tensions between the two Asian neighbours have not entirely subsided.

Each side has demanded compensation over the collision between the fishing boat and Japanese coast guard vessels that sparked the sea feud, near disputed islands called Diaoyu by China and Senkaku by Japan.

The roots of the trawler dispute lie in a long-standing disagreement over sovereignty of parts of the East China Sea, which has potentially rich natural gas resources.

The tensions have underscored the fragility of a relationship long troubled by bitter Chinese attitudes towards Japan's wartime occupation as well as by present-day mistrust as China edges past Japan as the world's second biggest economy.

China cancelled diplomatic meetings and student visits to protest the trawler captain's detention, and industry sources cited concerns that Beijing appeared to hold back shipments of rare earth minerals vital for electronics and auto parts.

Japanese Defence Minister Toshimi Kitazawa may seek talks with his Chinese counterpart in Vietnam next month to repair strained bilateral ties, Kyodo news agency reported, citing unnamed government sources.

(Reporting by Chris Buckley; Editing by Ken Wills and Jonathan Thatcher)