Beijing - Both China and Japan need to do more to ensure one of the world's most important and complicated bilateral relationships is on the right track, said analysts from both countries.

One of the latest major debates in Japan is whether to reduce financial aid to China, which overtook Japan as the world's second-largest economy in 2010.

Japan has been providing financial aid to China through its overseas development assistance (ODA) since 1979. It's ODA for China was worth $66 million in fiscal 2008, the last year for which data is available.

After Japan's cabinet released the nation's 2010 GDP figures in February, some officials, including Prime Minister Naoto Kan, said Japan welcomes China's economic growth as it means more opportunities.

But Takahashi Susumu, an economist and vice-administrative director of the Japan Research Institute in Tokyo, said that Japan being overtaken by China in the global economic stakes was "a big shock".

Many people in Japan regard China's rapid economic growth as a "threat", especially since Japan's sluggish economy also helps create a sharp contrast, Susumu said.

Japan's decreasing population and demand, as well as its limited resources push it to depend much on external resources and markets, according to Susumu.

"If Asian countries, with China taking the lead, have strong economic growth, Japan could benefit from a bigger overseas market," said Susumu.

"In return, Japan, as a developed country, can help other Asian nations with its technology and experience," Susumu said.

"Japan wants to establish good economic cooperation with China, but meanwhile it doesn't trust China politically," said Susumu.

"But the Japanese government handled this clumsily, and Japanese media reports are sometimes biased," Susumu noted.

Japan's diplomacy has been criticized for the way it dealt with the aftermath of the boat collision near the Diaoyu Islands in 2010.

Ample evidence proves the Diaoyu Islands have been an inalienable part of Chinese territory since ancient times, but Japan also claims sovereignty over the islands.

In Japan's new defense policy for the next decade adopted by the government in December 2010, it planned to increase military deployment in this area.

"The Chinese navy's growth makes Japan nervous, which is an important reason why in 2010 many neighboring nations, including Japan, played up territorial disputes with China," said Feng Zhaokui, former deputy chief of the Institute of Japan Studies at the Chinese Academy of Social Sciences.

But such worries, which interpret China's development as "threats", are unnecessary as China's military growth is an inevitable outcome of economic growth, as many other countries have experienced, said Feng.

"What China needs to do is increase strategic trust with these nations, which could reduce their worries regarding so-called China threats."

Shen Shishun, an expert on Asia-Pacific studies with China Institute of International Studies, said that China has been emphasizing that its development is for peaceful purposes, and this is what China has been doing.

Shen cited the example of China's notable efforts in maintaining peace on the Korean Peninsula, which was on the brink of war in 2010, and its helpful role in the global financial crisis since 2008 and the Asian financial crisis in 1997.

"As written in its Constitution, China is a responsible country with regard to global security and global economic security," Shen noted.

In the Constitution adopted in 1982, China vows to consistently oppose imperialism, hegemonism and colonialism.

It also vows to "strengthen unity with the people of other countries" and strive to "safeguard world peace and promote the cause of human progress".

"Domestically, China is building a harmonious society, which is also in line with the international community that calls for a harmonious world," said Shen.

China Daily