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Beijing - China has proposed setting up a maritime emergency hotline with Japan to prevent civilian and military clashes in the East China Sea and other waters, sources with both governments have said.
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Beijing has already established hotlines with Seoul and Washington.
Conflicts in the East China Sea have long existed between China and Japan.
Kyodo said in April a Chinese navy helicopter buzzed a Japanese Maritime Self-Defense Force destroyer in the East China Sea.
Beijing also protested to Tokyo through diplomatic channels over Japanese defense force surveillance flights over China's Chunxiao gas field in the East China Sea, it added.
The report said Tokyo is taking Beijing's suggestions for an emergency communication system positively and hopes to reach an agreement by year end.
But differences still linger, with Japan wanting the hotline set up at the defense ministry level while China says the level is too high and could hamper efficiency.
The largest difference, however, might lie with understanding China's motive for the proposal.
A senior Chinese scholar on Japanese studies said Japan's feeling of being threatened is partly due to the improvement of China's sea power.
"And it seems that Japan intends to restore its pro-US policy by playing up China's maritime existence to justify the controversial US Futenma air base in Okinawa," said Yang Bojiang with China University of International Relations.
Yin Zhuo, a major general of the Chinese navy, told China Daily the emergency system is designed to avoid both civilian and military clashes, the potential for which has been increasing in recent years.
"Some fishing boats from the Chinese mainland, Hong Kong and Taiwan have been expelled by Japanese military forces. And one Chinese military drill was disturbed by a Japanese destroyer on patrol," he said.
Yin said Japan's tight maritime patrol has kept frittering away mutual trust between the neighbors.
But, Kyodo said, Japan doesn't intend to decrease its surveillance, and the dispute will likely continue for some time.
Gu Tian contributed to this story.