The Japanese cabinet yesterday formally approved the signing of a memorandum with the United States involving joint research on an anti-ballistic missile defence system. Broad agreement on the issue had been reached last year after North Korea shocked the region by launching a missile.
Yesterday's approval comes as concerns mount that Pyongyang is now ready to test-fire another missile, believed to be capable of reaching parts of the US.
Tokyo and Washington are expected to exchange notes and a memorandum of understanding as soon as Monday, enabling research on the system to go ahead, a foreign ministry official said.
Japan has allocated 960 million yen (£6 million) for its part of the joint research. The Defence Agency has estimated that the project will cost Japan around 20 billion to 30 billion yen over a five to six-year period.
The system is intended to provide protection within a 3,000 km radius by detecting incoming ballistic missiles with satellites, and destroying them with missiles or by other methods.
Japanese officials have said Japan will concentrate its research on four areas: infra-red seekers, kinetic warheads, second-stage rocket motors and nose cones. In addition to the ballistic missile defence system, Japan decided last year to launch four spy satellites over the next several years to help it detect missile launches.
Kazuhiro Shimamura adds:
The Japanese Prime Minister, Mr Keizo Obuchi, basking in the glow of economic growth figures, announced yesterday he will run for a new term as party leader. "I have decided to run for the presidency again," he said, boasting of his economic achievements on the day fresh figures showed a stunning growth rate earlier this year.
He is expected to cruise to victory against two rivals for the post of Liberal Democratic Party (LDP) leader, who announced their candidacies shortly before.
Only hours earlier, the prime minister demonstrated his reputed haggling skills by saving his two-party coalition with the Liberal Party without losing support from the friendly opposition Komeito Party.
Mr Obuchi took power in July 1998, when he won a party poll to lead the LDP, which has dominated Japanese politics for 40 years. He was greeted with dismal popularity polls but his position has gradually improved.
The economy grew 2.0 per cent in the three months to March from the previous quarter, according to latest figures, although most analysts now expect a sharp slowdown.
The LDP leadership race effectively decides who is Japan's prime minister because of the party's dominance of the lower house of the Diet which chooses the post. Mr Obuchi boasted of his ability to save the coalition, and maintain the support of the Buddhist-backed Komeito Party, in negotiations with the two parties' leaders.
"It may sound presumptuous but I have confidence that I am the best qualified within the Liberal Democratic Party to create this kind of system," he said.