China surveillance ships enter waters near disputed islands

TOKYO (Reuters) - Two Chinese marine surveillance ships entered what Japan considers its territorial waters near disputed islands in the East China Sea on Monday, the Japanese Coast Guard said, a move bound to raise tension between Asia's two largest economies.

China's Xinhua news agency confirmed that two civilian surveillance ships were undertaking a "rights defense" patrol near the islands, citing the State Oceanic Administration, which controls the ships.

Sino-Japanese relations deteriorated sharply after Japan bought the islands, called Senkaku in Japan and Diaoyu in China, sparking anti-Japan protests in cities across China.

"In recent days, Japan has constantly provoked incidents concerning the Diaoyu islands issue, gravely violating China's territorial sovereignty," China's Xinhua news agency said.

The ship patrols were intended to exercise China's "administrative jurisdiction" over the islands, it said.

"Following the relevant laws of the People's Republic of China, (the ships) again carried out a regular rights defense patrol in our territorial waters around the Diaoyu islands."

The Japanese Coast Guard ordered the Chinese ships to move out of the area, but received no response, an official said.

Besides the two marine surveillance ships, there were nine Chinese fishery patrol ships near the islands as of 7:00 a.m. (2200 GMT on Sunday), but they were outside what Japan calls its territorial waters, the Coast Guard said.

Sino-Japanese ties have long been plagued by China's memories of Japan's military aggression in the 1930s and 1940s and present rivalry over regional influence and resources.

The islets are located near rich fishing grounds and potentially huge gas reserves.

The latest flare-up in tensions comes when both countries focus on domestic political pressures. Japanese Prime Minister Yoshihiko Noda's government faces an election in months, adding pressure on him not to look weak on China.

China's Communist Party is preoccupied with a leadership turnover, with President Hu Jintao due to step down as party leader at a congress that could open as soon as next month.

Despite the long-running territorial disputes, their economic ties have grown closer over the years. China is Japan's largest trading partner. In 2011, their bilateral trade grew 14.3 percent in value to a record $345 billion.

(Reporting by Kiyoshi Takenaka and Antoni Slodkowski in Tokyo and Chris Buckley in Beijing; Editing by Chang-Ran Kim and Nick Macfie)