South Korea's military was urged to be vigilant
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South Korea has warned its armed forces to be ready to deal with "provocations" from the North.
In a letter to his armed forces chiefs, South Korean Defence Minister Cho Young-kil said: "There is a growing probability of North Korea launching various provocations by surprise to boost its negotiating power."
The call for vigilance came amid heightened tension between the North and South, following reports that North Korea was reprocessing thousands of spent fuel rods, which could yield nuclear bombs within months.
Pyongyang is reported to have offered to abandon its nuclear ambition in return for American security guarantees and economic aid.
Dialogue 'limited'
Mr Cho said South Korea and the United States had tried to resolve the crisis peacefully though dialogue.
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NUCLEAR STAND-OFF
Oct 2002 - US says N Korea "admits" secret nuclear programme
Nov 2002 - US-led decision to halt oil shipments to N Korea
Dec 2002 - N Korea expels two nuclear watchdog's inspectors
Jan 2003 - N Korea says it is withdrawing from Nuclear Non-Proliferation Treaty
Feb 2003 - N Korea "restarts" Yongbyon nuclear plant
Apr 2003 - N Korean and US officials meet for three-way talks in China
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"But," he said, "if North Korea's aim is achieving nuclear weapons itself, the possibility of a diplomatic resolution could inevitably be limited."
South Korean President Roh Moo-hyun is due to travel to the US on Sunday to meet President George W Bush.
The administration in Washington is reportedly split on how to deal with North Korea.
Resolving the stand-off has been given new urgency by reports of renewed activity at the North's Yongbyon nuclear facility, which could allow Pyongyang to rapidly expand the nuclear weapons arsenal the US says it has already admitted to.
A South Korean official was quoted by the Associated Press on Thursday as saying that a US spy satellite photograph showed smoke coming from radiation and chemical laboratories in Yongbyon.
But a spokesman for South Korea's Unification Ministry, Kim Jung-ro, said the movement did not necessarily mean that the North was
reprocessing fuel.
"We are not sure if they are doing it as an extension of the bluffing or if it is a step to develop nuclear weapons. We need more evidence," he said.
On Wednesday, Seoul urged North Korea to make the first move in its stand-off with the United States.
South Korean Foreign Minister Yoon Young-kwan said that Pyongyang could not expect the concessions it was seeking from the US unless it gave up its nuclear weapons programme first.