5 things to know ahead of the Abe-Putin hot springs summit

Japanese Prime Minister Shinzo Abe will become on Thursday the first G-7 leader to allow an official visit by Russian President Vladimir Putin since Russia’s annexation of Crimea in 2014.

The reason? His eagerness to resolve a 70-year-old territorial dispute that has kept their countries from signing a peace treaty formally ending World War II. A look at the two-day talks, which open at a hot springs resort in Abe’s ancestral hometown of Nagato and wrap up Friday in Tokyo:

THE ISLANDS

Japan says the Soviets took the southern Kuril islands illegally at the end of World War II, expelling 17,000 Japanese to nearby Hokkaido, the northernmost of Japan’s four main islands. About one-third of the former residents are still alive. The Soviet Union, unilaterally scrapping a 1941 neutrality treaty, entered the war against Japan a week before the latter’s surrender on Aug. 15, 1945. It occupied the disputed islands – known as the Northern Territories in Japan – within weeks, a process Russia says was legal. The two countries signed a Japan-Soviet Joint Declaration in 1956, ending their state of war and restoring diplomatic relations, but failed to conclude a peace treaty because of the island issue. Russia governs the islands and the Russians who live there.

PROSPECTS

Japanese hopes for a settlement sank after Abe met Putin last month on the sidelines of the Asia-Pacific Economic Cooperation meeting in Peru. James Brown, a Russia-Japan expert at Temple University’s Japan campus said “there are too many obstacles to an agreement on the territorial issues to actually sign a peace treaty. I think they are trying to come up with some sort of formulation that gives the impression of progress.” Former Japanese diplomat Kazuhiko Togo said in a recent commentary that serious negotiations began only after Abe and Putin met in Sochi, Russia, in May, “and seven months is too short to untie this complicated knot.”

ECONOMY FIRST

Russia wants to attract Japanese investment, particularly to its far east. Japan’s trade minister in charge of Russia, Hiroshige Seko, said about 30 projects in eight areas are ready for signing: Japan would provide advanced medical, health and environmental technology and help with the industrialization of the far east, while receiving expertise from Russia in decommissioning nuclear plants, energy and cyber security. “We will have a win-win situation, at least in economic relations,” he told a news conference this week. Joint development of the disputed islands is also on the table, but Japan is wary of the sovereignty issue: If it’s Japanese territory, shouldn’t Japanese laws apply?

THE LEADERS’ WORDS

Abe told a group of former residents of the islands this week that “I’m determined to put an end to this issue in our generation.” Putin told Japanese journalists Tuesday that there is a chance of a breakthrough, but his government doesn’t mind the status quo. “We think that we have no territorial problems. It’s Japan that thinks that is has a territorial problem with Russia,” he said.

TRUMP FACTOR

A Russia-friendly approach from U.S. President-elect Donald Trump could buy time, taking pressure off Japan to strike a quick deal before a change in U.S. leadership, said Alexander Gabuyev, a Carnegie Moscow Center expert on the Pacific region. Trump’s opponent, Hillary Clinton, had been expected to take a tougher stance toward Moscow. At the same time Trump’s “America first” policy has raised concern in Japan that any reduction of the U.S. military presence in Asia could mean increased risks for Japan as China’s regional ambitions grow. Even short of a territorial agreement, Japan is keen to have closer relations with Russia for security reasons.