China delays diplomatic reception with Japan

BEIJING (Reuters) - China has postponed a ceremony marking the 40th anniversary of the resumption of diplomatic ties with Japan as a result of a territorial row between the two countries, the official Xinhua news agency said on Sunday.

A dispute over uninhabited islands in the East China Sea, known as the Diaoyu in China and the Senkaku in Japan, erupted into a full-scale diplomatic row this month after the Tokyo government bought the islands from private Japanese landowners.

China's foreign ministry had hinted on Friday that events marking the 1972 switch in diplomatic recognition from Taiwan to China would be affected, when it said "many plans had been ruined" by the Tokyo government's actions.

Japanese media had said China was likely to go ahead with the large-scale ceremony on Thursday in Beijing.

On Sunday, Xinhua quoted an official of the China People's Association for Friendship with Foreign Countries (CPAFFC) that there "would be a change", when asked by a reporter when the ceremony would take place.

"The Japanese government.... insisted on 'buying' the Diaoyu Islands, which was illegal and severely damaged China-Japan relations and ruined the atmosphere of the 40th anniversary," Xinhua said.

The row sparked four days of sometimes violent protests in Chinese cities last week, with Japanese businesses shutting hundreds of stores and factories.

Sino-Japanese ties have long been plagued by China's bitter memories of Japan's military aggression in the 1930s and 1940s and present rivalry over resources. The seabed around the islands is believed to be energy-rich.

(Reporting by David Stanway; Editing by Ron Popeski)