The meeting between the two leaders was followed by the signing of a slew of agreements.

Faced with the threat of a trade war with the United States, China and Japan have decided to work together to develop new overseas markets, by focusing on collaboration instead of competing with each other.

“Turning to cooperation from competition, the relationship between the two nations is entering a new stage,” Japanese Prime Minister Shinzo Abe said a joint press conference with his Chinese counterpart Li Keqiang on Friday.

Prime Minister Li endorsed how ties between the two countries had pivoted from full-blown rivalry to growing partnership, especially over the last two years.

Mr. Li spotlighted that “we (China and Japan) are cooperation partners to each other and not a threat, and we support each other for peaceful development”.

In his brief remarks, the Japanese Prime Minister nailed that joint forays in third countries would now be one of the new templates of Tokyo-Beijing ties.

“We have set up a new mechanism of cooperation between China and Japan in third party markets. Over 1000 business representatives from the two nations gathering and signing multiple cooperation documents is one good example,” he observed.

Analysts say that the Japanese Prime Minister’s remarks showcase his “pragmatism,” notwithstanding his strong nationalistic instincts. “Despite being proud Japanese, I think Mr. Abe is also a very pragmatic politician,” Huang Jing, Dean of International and Regional Studies Center at the Beijing Language and Culture University told The Hindu.

Japan’s Kyodo news agency is reporting that by bolstering investment in other countries, the governments of Asia's two biggest economies will aim to form a new model of economic cooperation between them.

The meeting between the two leaders was followed by the signing of a slew of agreements, which covered energy cooperation, military confidence building measures in the East China Sea, infrastructure development and joint development of hi-end technology.

Focusing on cutting-edge know-how, an agreement was signed to establish a discussion platform on hi-end technology and intellectual property. The Chinese side hopes that such a forum would help make-up possible shortages of U.S. components, in case the Beijing-Washington trade and technology war escalates.

The two sides also signed an agreement on joint development of gas fields in the East China Sea—an initiative that was stalled in 2008, when tensions over islands, called Diaoyu by China and Senkaku by Japan, spiraled. A decision has also been taken to launch joint search and rescue missions in these waters.

Analysts say that China seeks Japanese companies to participate in its Belt and Road projects, especially in the financial sphere, to counter allegations that Beijing is deliberately pursuing “debt trap” diplomacy as tool for exercising political control in developing countries. By entering into joint ventures, Japanese firms hope they can revive their flagging fortunes in new opportunity areas.

The two countries also signed a bilateral currency swap dealt of $ 26.7 billion—around 10 times as larger than a previous agreement that has expired.

Mr. Abe said that Japan and China agreed to work together to open a hotline as soon as possible. That would help avert accidental clashes at sea and in the air. He stressed that the East China Sea should become a "sea of peace, cooperation and friendship."

On North Korea, the two leaders reiterated that denuclearisation of North Korea was necessary. Mr. Abe said that Tokyo and Beijing will “fulfill responsibilities” for peace and stability in East Asia.