Seoul, Sep 30 (AP) Japan's outgoing Prime Minister Shigeru Ishiba held a summit Tuesday with South Korean President Lee Jae Myung, as US President Donald Trump's trade wars have pushed the two often-feuding Asian neighbours to seek to improve coordination.

The Ishiba-Lee meeting in the South Korean southeastern port city of Busan is their third and likely final summit. Earlier this month, Ishiba offered to resign as head of the governing Liberal Democratic Party and eventually prime minister over his ruling coalition's recent election defeat, triggering a contest to find his successor.

"I look forward to exchanging thoughts on cooperation between the two governments, further development in the cooperative bilateral partnership, social challenges we both face, such as declining population," Ishiba said in his brief departure comments in Japan.

Lee's national security director, Wi Sung-lac, told a briefing Monday that the summit would provide a venue to expand discussions in the midst of "the rapidly changing geopolitical environment and trade order." Wi said that the two leaders will discuss Ishiba's possible active role in developing bilateral ties even after his departure.

South Korea and Japan are both key US allies and major trading partners. But their ties have experienced constant shifts because of history disputes stemming from Japan's past colonial rule of the Korean Peninsula. Relations have improved under Lee and Ishiba's predecessors. But the departure of Ishiba, who has acknowledged Japan's wartime aggression and shown empathy toward the Asian victims, could pose a challenge to Lee.

Both governments said the summit was part of earlier agreements to maintain close communication and high-level exchanges between the countries. No major announcement is expected after the summit, and South Korean officials say the meeting would discuss population issues, revitalizing rural areas and artificial intelligence.

South Korea and Japan have sought ways to tackle together challenges like North Korea's nuclear programme and supply chain vulnerabilities. They are now being pushed closer together by Trump's push to reset global trade.

South Korea and Japan have pledged hundreds of billions of dollars in US industrial investments in hopes of avoiding the Trump administration's highest tariffs. But South Korean officials acknowledge they remain at odds with Washington over how Seoul's proposed USD 350 billion package would be structured and operated.

South Korean officials have proposed delivering the investment through loans and loan guarantees and have balked at US demands for upfront payments, which they say would put the country at risk of a financial crisis given the size of its foreign-currency reserves.

Unlike Seoul, Tokyo has already put its trade deal with Washington in writing. Trump earlier this month signed an order to lower tariffs on Japanese automobiles and other critical imports, from the initially proposed 25 per cent to 15 per cent while the two governments simultaneously signed a joint statement in Washington confirming USD 550 billion in Japanese investment in US projects. (AP) MPL MPL

Trade coordination steered the Japan-South Korea summit, focusing on tariffs, supply chains, investment mechanisms and policy continuity. The summit between Japan and South Korea concentrated on enhancing bilateral coordination in trade and economic diplomacy to address supply chain vulnerabilities and recent tariff adjustments, while discussing structures for large-scale industrial investment-contrasting loan and guarantee delivery proposals with upfront payment expectations-and broader cooperation on population, rural revitalization, artificial intelligence, and regional security, including continuity of engagement after leadership change.