TAIPEI, JAPAN - A JAPANESE envoy on Friday apologised to the captain of a Taiwanese fishing boat which sank after colliding with a Japanese patrol ship near disputed islets in the East China Sea.

'I am here today to express our sincere apology to the captain,' Hitoshi Funamachi, Japan's deputy de facto ambassador to Taiwan, told reporters through an interpreter.

Mr Funamachi, while visiting captain Ho Hung-yi at his home in Taipei county, also delivered an apology letter signed by Japanese coast guard official Hideo Nasu.

'The captain who lost his boat and his livelihood is in difficulty, we hope to start (discussing) compensation... and prevent similar incidents from happening again,' Mr Chou said.

The 'Lien Ho' sank near the island chain last week after colliding with a Japanese patrol vessel under the command of Mr Nasu. The Japanese boat rescued all 16 people onboard and sent them back to Taiwan after questioning.

Japan administers the uninhabited island group, which lies near rich energy deposits, but it is also claimed by Taipei and Beijing.

President Ma Ying-jeou has stressed Taiwan's sovereignty over the islands, known as Senkaku in Japanese and Diaoyu in Chinese, but pledged to resolve the matter peacefully through diplomatic channels.

Mr Ma's office on Friday expressed satisfaction that the incident had been dealt with but said other issues remained unsolved.

'Our determination to defend the sovereignty of Diaoyu islands has never changed... we will also start negotiating with Japan on fishing issues to ensure our fishermen's rights,' it said in a statement.

The incident stirred an outcry in Taiwan, with a local protest boat entering Japan's territorial waters near the islands early Monday, escorted by nine patrol ships.

Taiwan's de facto envoy to Japan, Koh Se-kai, was summoned home over the weekend and resigned amid criticism over how he handled the incident. -- AFP