(MENAFN- Live Mint) The ongoing China-Japan dispute over Prime Minister Sanae Takaichi's comments on Taiwan is unlikely to fade soon, as the neighbouring countries' attempt at diplomatic talks on Tuesday did not go well, a senior Chinese diplomat indicated.

According to a report by Chinese news outlet The Paper, Liu Jinsong, director-general of the Chinese Foreign Ministry's Asian Affairs Department, said he was“dissatisfied” with the result of his meeting with his Japanese counterpart, Masaaki Kanai.

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Relations between the two neighbours have soured recently after Takaichi became the first sitting Japanese leader in decades to publicly link a Taiwan Strait crisis with the possible deployment of Japanese troops. Her remarks drew swift retaliation from Beijing, which warned of more to come.

China has demanded that Takaichi retract her statement, and state media blasted her comments, saying they“sound a stark warning that Japan's militarist demons are being summoned anew.”

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Japan, meanwhile, said Kanai reiterated that the country's position on Taiwan remains unchanged. Kanai also pushed back against“extremely inappropriate statements” made by Xue Jian, China's consul general in Osaka, who threatened to cut off Takaichi's head in a now-deleted post on X. Tokyo demanded immediate action against the diplomat.

The back-and-forth between the two sides suggests the dispute shows little sign of easing.

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Beijing has also warned Chinese citizens against travelling to Japan.

This move has already led at least two state-owned travel agencies to scrap group tours to Japan, booked months in advance, according to Bloomberg, citing people familiar with the matter.

The travel warning triggered a sharp selloff in Japan's biggest tourism and retail stocks before they recovered some of their losses.

State-owned firms have advised employees to avoid travel to Japan, with some investment groups, banks, brokerages and other companies sending cautionary messages to staff this week, Bloomberg reported, citing people familiar with the matter.

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