The US and Japan "recognised that a robust forward presence of US military forces in Japan, including in Okinawa, provides the deterrence and capabilities necessary for the defence of Japan and for the maintenance of regional stability," said a joint statement.

The statement was issued by Hillary Clinton, the US secretary of state, Robert Gates, the US secretary of defence, Katsuya Okada, the Japanese foreign minister, and Toshimi Kitazawa, the Japanese defence minister.

"The ministers recognised the importance of responding to the concerns of the people of Okinawa that they bear a disproportionate burden related to the presence of US forces, and also recognized that the more equitable distribution of shared alliance responsibilities is essential for sustainable development of the alliance," it said.

'Difficult decision'

Following a phone conversation with Barack Obama, the US president, Hatoyama said Obama had "expressed appreciation that the two countries could reach an agreement".

"It is a total about-face for Hatoyama," Tomohiko Taniguchi, a political analyst and professor at Keio University in Tokyo, told Al Jazeera.

"The prime minister's learning curve has been extremely gradual."

Hatoyama had campaigned on a pledge to move the US base off Okinawa [Reuters]

The decision has angered tens of thousand of Okinawa residents who have complained about noise levels, pollution and crime associated with the base, and want Futenma moved off the island entirely.

Hirofumi Hirano, the Japanese chief cabinet secretary, said the cabinet will meet to discuss the issue on Friday morning.

"It was a difficult decision as we have to ask Okinawans to shoulder a burden, but overall when you look at the whole picture," Hirano said.

"The security situation on the Korean peninsula is a concern for both nations," Taniguchi said, adding that Japan and the US are also both worried about China's military build up.

Hatoyama took office last September promising to create a "more equal" relationship with the US.

He had promised to move the marine base off the island, which hosts more than half the 47,000 US troops stationed in Japan under a 50-year-old joint security pact.

However US military officials have argued it was essential that the base remain on Okinawa because its helicopters and air assets support marine infantry units based there.

Moving the facility off the island, they said, could slow the marines' coordination and response in times of emergency.