North Korea plays for hard bargain with nuke boast

North Korea has taken a calculated bargaining risk by announcing for the first time that it has nuclear weapons, a South Korean official said yesterday, after the United States rejected North Korean calls for one-on-one talks.

Pyongyang's announcement on Thursday, that it had nuclear weapons and was pulling out of six-party talks aimed at curbing its atomic ambitions, presents a major challenge to South Korea, its main ally, the United States, and China, which has played a lead role in the disarmament effort.

Australian Foreign Minister Alexander Downer said after discussions with the North Korean and Chinese envoys in Canberra that he saw a reasonable chance that Pyongyang would return to the talks. South Korean Vice Foreign Minister Lee Tae-shik said it was significant that the North had not declared outright that it would not return to the negotiating table.

"It seems like North Korea was trying to raise interest and the stakes," Lee was quoted as saying by Yonhap news agency.

"North Korea's statement said it had stopped participating in six-way talks because conditions were not ripe. That indicated there was room for interpretation."

North Korean media declared yesterday that the United States wanted to invade North Korea to dominate Asia but conservative South Korean dailies said Seoul must not back down to Pyongyang.

World leaders have warned Pyongyang against upping the ante with its nuclear boast and tried to play down its significance, saying that it merely confirmed what they already knew. But the development comes at a critical time for US President George W. Bush at the start of his second term, and who also faces confrontation with Iran over its nuclear ambitions.

US Secretary of State Condoleezza Rice is to discuss North Korea with Chinese Foreign Minister Li Zhaoxing in the coming days, and South Korean Foreign Minister Ban Ki-moon is already in Washington for talks.

Australia is seeking to mediate in the face-off between Pyongyang and Washington.

South Korea, still technically at war with its impoverished neighbour half a century after the Korean War ended with an inconclusive truce, has tried to improve relations through economic and humanitarian assistance. Nevertheless, it lives under constant threat from a state that masses 70 per cent of its 1.2-million-strong army along a border that passes just 65 km north of Seoul.