SEOUL (BLOOMBERG) - South Korea may go ahead with maritime defence drills around a group of islands that the country and Japan have competing claims over, Yonhap News Agency reported, citing unidentified military and government officials.

The drills could begin as early as this month for the easternmost Dokdo islands - which Japan calls Takeshima - that lie between Korea and Japan, Yonhap said. The exercises involve the navy, air force and coast guard, and they are usually carried out in June and December, it said.

South Korea and Japan are embroiled in a complicated dispute over trade that is turning into one of the worst crises in the nations' often-fraught bilateral ties since a 1965 treaty normalised relations.

Carrying out the drills around the islands risks adding to the tensions, which have already been marked by a series of protests, boycotts and economic warnings.

While South Korea's government had initially put off the twice-yearly drills to prevent worsening the relationship with Tokyo, as Japan is "continuing to exacerbate the situation", the drills could no longer be postponed, Yonhap said, citing a person it did not identify.