The East Asia Summit is a forum for dialogue on strategic, political and economic issues involving the 10 Association of Southeast Asian Nations (ASEAN) members as well as Australia, China, India, Japan, South Korea and New Zealand.

US Secretary of State Hillary Clinton and Russian Foreign Minister Sergei Lavrov will be invited to join the 16-nation annual summit in Hanoi against a background of simmering tensions between China and Japan.

Asia's two big powers have been embroiled in their worst diplomatic row in years, sparked by a territorial dispute that has escalated into protests, scrapped meetings and allegations China is freezing exports of vital minerals.

All eyes in Vietnam's capital have been on the sparring match and whether the rival premiers, China's Wen Jiabao and Japan's Naoto Kan, would hold highly anticipated direct talks.

The prospects appeared good after Japanese Foreign Minister Seiji Maehara met with his China counterpart early Friday, saying they had agreed to improve ties and that the two-way summit would "probably take place in Hanoi".

But there was confusion later as the Japanese delegation announced the leaders' meeting would take place, and then shortly afterwards retracted its statement.

China's assistant foreign affairs minister Hu Zhengyue then used extremely strong terms to condemn Japan's behaviour.

"Japanese diplomatic authorities have partnered with other nations and stepped up the heat on the Diaoyu island issue," he said, referring to disputed East China Sea islands known as the Senkaku in Japan.

He said the comments had "violated China's sovereignty and territorial integrity."

"The Japanese moves, which is clear for everyone to see, have ruined the needed atmosphere for a meeting between the two leaders. Japan should take full responsibility for the result."

China also voiced strong dissatisfaction over remarks by Clinton that the disputed islands fall within the scope of the US-Japan security alliance.

"The Chinese government and people will never accept any word or deed that includes the Diaoyu (Senkaku) islands within the scope of the US-Japan Treaty of Mutual Cooperation and Security," foreign ministry spokesman Ma Zhaoxu said in a statement on the ministry website.

The neighbours have been feuding since the September 8 arrest of a Chinese trawler captain after a collision with Japanese coastguard vessels near the disputed island chain in the resource-rich East China Sea.

Kan's spokesman Noriyuki Shikata said there was no reason for "heightened tensions... between the two countries."

"I don't see the kind of basis for that kind of reaction," he told reporters in Hanoi. "We are ready to engage in dialogue."

The United States called on China and Japan to hold talks to ease tensions.

"We want China and Japan to sit down, to have dialogue and work through the issues" surrounding disputed islands and a recent sea collision, State Department spokesman Philip Crowley told reporters in Washington.

"We would hope that both countries will take affirmative steps to de-escalate tensions around this issue and that will create the conditions for a meaningful dialogue," Crowley said.

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