U.S. hails Korea talks, despite North's rejection of denuclearization

SEOUL/WASHINGTON (Reuters) - North and South Korea held their first talks in over two years on Tuesday, which Washington welcomed as a first step to solving the North Korean nuclear weapons crisis, even though Pyongyang said those were aimed only at the United States and not up for discussion.

The U.S. State Department said Washington would be interested in joining future talks, but stuck to its insistence that they must be aimed at denuclearization, showing that a diplomatic breakthrough remains far off.

In a joint statement after 11 hours of talks, North and South Korea said they had agreed to hold military to military talks and that North Korea would send a large delegation to next month's Winter Olympics in South Korea.

However, North Korea made a "strong complaint" after Seoul proposed talks to denuclearize the Korean peninsula.

"Clearly this is a positive development," a spokesman for the U.S. State Department, Steve Goldstein, said of the joint statement, while adding: "We would like nuclear talks to occur; we want denuclearization of the Korean peninsula. This is a good first step in that process."

North and South Korea said they agreed to meet again to resolve problems and avert accidental conflict, amid high tension over North Korea's program to develop nuclear missiles capable of hitting the United States.

"All our weapons, including atomic bombs, hydrogen bombs and ballistic missiles, are only aimed at the United States, not our brethren, nor China and Russia," Pyongyang's chief negotiator, Ri Son Gwon, said.

"This is not a matter between North and South Korea, and to bring up this issue would cause negative consequences and risks turning all of today's good achievement into nothing," Ri said in closing remarks.

The White House and State Department did not respond to requests for comment on the United States being the only potential target of North Korea's nuclear weapons.

U.S. President Donald Trump and North Korean leader Kim Jong Un have exchanged threats and insults in the past year, raising fears of a new war on the peninsula.

The United States, which has 28,500 troops stationed in South Korea as a legacy of the 1950-1953 Korean War, initially responded coolly to the idea of inter-Korean meetings, but Trump later called them "a good thing" and said he would be willing to speak to Kim.

"At the appropriate time, we'll get involved," Trump said on Saturday, although U.S.-North Korean talks appear unlikely any time soon, given entrenched positions on both sides.

The United States has warned that all options, including military ones, are on the table in dealing with North Korea.

Washington agreed with Seoul last week to postpone joint military exercises that Pyongyang denounces as rehearsals for invasion until after the Olympics, but the North-South thaw has not altered the U.S. intelligence assessment of North Korea’s weapons programs.

The consensus, according to U.S. officials familiar with the classified analysis, is that Kim remains convinced the United States is determined to overthrow him and that only a nuclear arsenal that threatens America can deter that.

One official said the North-South talks were likely to follow the pattern of past diplomatic efforts, in which the North has benefited from additional food and other aid without making any concessions on the weapons front.

The additional danger now, said a second official, was that Kim would seek to use the talks to take advantage of Trump's sometimes bellicose rhetoric to try to drive a wedge between Washington and Seoul.

U.N. Secretary-General Antonio Guterres welcomed the talks, particularly the agreement to hold military-to-military talks, calling this "critical to lowering the risk of miscalculation".

He also welcomed North Korea's decision to send a delegation to the Olympics and said he hoped for the resumption of dialogue leading to denuclearization.

In spite of the North Korean negotiator's remarks, South Korea's Unification Ministry said it believed Tuesday's talks could lead to discussion of a "fundamental resolution" of the nuclear issue.

"We will closely coordinate with the United States, China, Japan and other neighbors in this process," it said, adding that Seoul had asked Pyongyang to halt acts that stoke tension.

Tuesday's meeting followed a year of ramped-up North Korean missile test launches, some of them over Japanese territory, and its sixth and most powerful nuclear test, which prompted a U.S.-led campaign to toughen U.N. sanctions.

The U.S. State Department said later in the day that it had approved the sale of anti-ballistic missiles to Japan to defend itself.

North Korea-South Korea talks: http://tmsnrt.rs/2Ar8lUu

North Korea revealed: http://reut.rs/2z4KDPt

Graphic: http://tmsnrt.rs/2miGPDI

'HIGH HOPES'

Earlier on Tuesday, Seoul said it was prepared to lift some unilateral sanctions temporarily so North Koreans could visit for the Olympics. North Korea said its delegation would include athletes, high-ranking officials, a cheering squad, art performers, reporters and spectators.

Talks to work out details would be held soon, the South's Unification Ministry said.

Tuesday's talks were the first between the two Koreas since 2015 and were held at the Peace House on the South Korean side of Panmunjom truce village.

Seoul said it proposed reunions of divided families in time for February's Lunar New Year holiday, but the joint statement made no mention of any agreement on this.

Seoul said North Korea had finished technical work to restore a military hotline, with normal communications set to resume on Wednesday.

North Korea cut communications in February 2016, following South Korea's decision to shut down a jointly run industrial park.

Seoul also said North Korea responded "positively" to the South's proposal for athletes from both sides to march together in the Olympic opening ceremony.

Such a joint parade has not happened since the 2007 Asian Winter Games in China.

China's Foreign Ministry said it was happy to see talks between North and South Korea and welcomed all positive steps. Russia echoed the sentiment. "This is exactly the kind of dialogue that we said was necessary," a Kremlin spokesman said.

Some U.S.-based analysts have hailed the talks as an opening for diplomacy, but others see an attempt by North Korea to weaken U.S. pressure so that it is eventually accepted as a nuclear-armed state.

Evans Revere, a former senior U.S. diplomat for East Asia, said that by engaging Seoul, North Korea was clearly seeking to weaken the U.S.-South Korean alliance and it was important that Seoul had raised the nuclear issue to show it was not just a U.S.-North Korea matter.

(Additional reporting by Josh Smith and Soyoung Kim in SEOUL and David Brunnstrom, Susan Heavey, Jim Oliphant, Steve Holland, John Walcott, Arshad Mohammed, David Alexander adn Chris Sanders in WASHINGTON; Editing by Bill Trott, James Dalgleish and Grant McCool)