Mori fails in Russia, returns to uncertainty

Japan's embattled Prime Minister, Mr Yoshiro Mori, finally met President Vladimir Putin of Russia yesterday to discuss the formal end of the second World War between the two countries. However, he failed to bring home an agreement that might have shored up his rock-bottom popularity.

The meeting, which took place in the Siberian city of Irkutsk, was called to discuss the resolution of the long-standing territorial dispute in the north of Japan. Japan insists that the Pacific Kurile Islands, which were seized by the Red Army in 1945, should be handed back, but Russia has so far refused.

The issue has haunted relations between the two countries for years and prevented the signing of a peace treaty formally ending the war. Mr Mori met Mr Putin three times last year to try to resolve the dispute. The latest meeting had been delayed because of uncertainties about Mr Mori's political future.

There was some speculation by political commentators that Mr Mori might have pulled off an agreement, given the time he and other government officials have dedicated to the Kurile Islands problem, but little seems to have been achieved except for a vaguely worded statement that the two countries would continue to work towards a peace deal.

The empty-handed Japanese PM heads back to a political situation in Tokyo which was described by veteran political commentator Kenzo Uchida on Saturday as being in "a bizarre state of limbo". Mr Mori continues to suffer some of the lowest approval ratings on record after a series of political and verbal gaffs, and the ruling Liberal Democratic Party (LDP) is struggling to deal with the effects of a 10-year economic slump.

He has indicated his willingness to step down as president of the LDP but it remains uncertain when he will do so or who will take his place. The LDP dominates a three-way coalition and resigning as president of the party effectively means stepping down as Prime Minister.

The faction-ridden LDP has thrown up two possible successors, both of whom have been greeted with widespread indifference by the weary Japanese public. The former health and welfare minister, Mr Junichiro Koizumi (61), has the reputation of being a reformer but may well face stiff opposition from within the conservative LDP over his call for the privatisation of the country's postal savings, postal insurance and mail service systems. Japan's postal system contains billions of pounds of low-interest paying savings and some reformers believe that this money would help boost the economy if it were opened up.

The former LDP secretary general, Mr Hiromu Nonaka's name has also been linked to a possible leadership role but at 75 years old, with a reputation for craftiness and backroom dealing, he sets few pulses racing.

To add to the confusion some media were reporting yesterday that Mr Koizumi was reconsidering whether to step forward.