Tuesday, June 16, 1998 Published at 16:19 GMT 17:19 UK
N Korea to continue making missiles
North Korea's economy is suffering under sanctions
North Korea has said it will press ahead with developing weapons unless the United States agrees to lift sanctions against it and pursue peace in the region.
In a statement issued by the official Korean Central News Agency, North Korea said it would only be able to afford to stop exporting missile technology if Washington lifted its economic embargo.
"If the US really wants to prevent our missile export, it should lift the economic embargo as early as possible and make a compensation for the losses to be caused by discontinued missile export," the agency said.
The agency said the US, which is still officially at war with Pyongyang, seeks to prevent the country defending itself.
It said as long as the US continued to target missiles at North Korean territory, it found "no reason to refrain from developing and deploying missiles to counter them".
"The discontinuation of our missile development is a matter which can be discussed after a peace agreement is signed, and the US military threat completely removed."
The statement was the first response to an accusation by US officials that North Korea exported nuclear and missile technology to other nations including Pakistan, which carried out its first nuclear test in May.
Experts suspect that North Korea has supplied weapons technology to Pakistan as well as Iran, Iraq and Syria.
A BBC correspondent says that threatening to make trouble has been a favourite tactic of North Korea in the past.
Five years ago, it test-fired a missile into the sea in a demonstration that showed its neighbour Japan would be within range of its weapons.
International talks aimed at bringing a permanent peace to the Korean peninsula ended in failure in March. But relations between North and South Korea had been improving in recent weeks, though our correspondent says the current statement may set things back.
The President of South Korea, Kim Dae-jung, has suggested to the US that removing the 50-year-old restrictions on trade would help to befriend North Korea and make it less of a threat to the world.