(ATTN: ADDS more details, background throughout)
By Kim Soo-yeon
SEOUL, Jan. 5 (Yonhap) -- South and North Korea agreed Friday to hold high-level talks next week to discuss Pyongyang's potential participation in the PyeongChang Winter Olympics and ways to improve ties.
North Korea notified South Korea that it has accepted Seoul's recent offer to hold talks next Tuesday at the truce village of Panmunjom, according to the Ministry of Unification. It would mark the first inter-Korean talks since December 2015.
"The main agenda items will include how to improve the two Koreas' relations including (the North's participation in) the Winter Games," Baik Tae-hyun, a ministry spokesman, told a press briefing.
He said that the two sides will discuss details needed for talks, including the composition of delegates, by exchanging documents.
Signs of a thaw in the long-stalled ties came as North Korean leader Kim Jong-un expressed in his New Year's message a willingness to send a delegation to the Olympics to be held in the South next month, a rare rapprochement to the South.
Seoul proposed Tuesday to hold high-level talks in response to Kim's message that he is open to dialogue. A day later, the North reopened a cross-border hotline after a nearly two-year suspension.
Seoul and Washington's recent decision to delay joint military drills until after the games, confirmed by their presidents Thursday, appears to have prompted the North to accept the South's dialogue offer, experts say.
North Korea has long denounced the military drills as a war rehearsal and used them as an excuse for its provocations. The South and the U.S. said that the exercises are defensive in nature.
In his New Year's Day speech, Kim called on South Korea and the U.S. to suspend the military drills and halt Washington's regular deployment of strategic assets around the Korean Peninsula. His remarks were viewed as the North's preconditions for talks.
"Given Kim's tone in his message, it is not surprising that the North accepted the South's offer as it is," said Kim Yong-hyun, a professor at Dongguk University. "The allies' decision to postpone military exercises seemed to affect (the North's decision)."
South Korea's presidential office Cheong Wa Dae said that the two Korea could discuss ways to improve relations, but only after they finalize the Olympics issue.
Possible agenda items with regard to the Olympics include whether the North's delegation would travel by land or other routes and whether the two Koreas would march together under a unified Korean flag at the opening and closing ceremonies. Costs of stays and other bills could also be dealt with during discussions.
The government of liberal President Moon Jae-in hopes that better inter-Korean relations can help pave the way for the resolution of North Korea's nuclear issue and broader talks between the U.S. and North Korea.
Some experts said that the North's overture to South Korea may be aimed at weakening the united front in enforcing sanctions on Pyongyang and driving a wedge in the decades-long alliance between Seoul and Washington.
North Korea is under tough international sanctions over its nuclear and missile provocations including the sixth and most powerful nuke test in September last year and launches of three intercontinental ballistic missiles (ICBMs).
While extending an overture to Seoul, the North's leader warned the U.S. that a "nuclear button" is on his desk in his New Year's speech.
During a phone conversation, Moon and President Donald Trump agreed Thursday to continue the U.S.-led campaign of maximum pressure against North Korea and "not to repeat mistakes of the past."
"There is no change in the government's stance that along with efforts to restore inter-Korean ties, Seoul will consistently push for North Korea's denuclearization together with the international community," Baik said.
"We will prepare for talks, based on close coordination with the U.S. and relevant countries," he added.
Analysts said that if North Korean officials blacklisted in international sanctions come to the South as delegates, it could be in violation of the sanctions regime.
"The government has a basic stance that it will prepare for the events in a way that North Korea's participation in the games does not violate international sanctions, including Washington's unilateral punitive actions," the spokesman said.
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