Japan promised some 42.6 billion yen July 3 in fresh economic aid to Peru, while Peruvian President Alberto Fujimori brushed aside concerns over terrorism and urged Japanese firms to invest further in his country.

Appearing at a news conference in Tokyo, Fujimori said the 127-day hostage crisis at the Japanese ambassador's residence in Lima was "an isolated incident." Peru had taken appropriate measures to ensure public safety, including those to fight terrorism, even before the hostage crisis, he told reporters. Therefore, he added, Japanese firms should increase investment in Peru and Japanese people should travel to the country.

"Peru is attractive for Japanese investment and I hope Japanese firms (which are conducting feasibility studies in Peru) will make good decisions," Fujimori said. Earlier in the day, Fujimori met with Prime Minister Ryutaro Hashimoto, who said Tokyo will provide Peru with some 42.6 billion yen in low-interest loans for infrastructure projects.

During the talks, Hashimoto thanked Fujimori again for ending the four-month hostage crisis, and the two leaders confirmed their efforts to deepen bilateral ties, according to Foreign Ministry officials. Hashimoto said the yen loans will help alleviate poverty and protect the environment, the ministry officials said. The loans include 10.14 billion yen for electricity generation, 11.64 billion yen for water supply facilities in Lima and 9.18 billion yen for road construction, according to the officials.

The ambassador's residence was seized by guerrillas of the Tupac Amaru Revolutionary Movement on Dec. 17 during a reception in honor of the Emperor's birthday. The crisis ended April 22 when Peruvian commandos stormed the residence, rescuing all but one of the remaining 72 hostages. All 14 rebels were killed during the operation.