By Charles Scanlon
BBC correspondent in Seoul
North and South Korea have agreed to formally open newly-built roads through the military buffer zone that divides the two countries.
Both sides are cooperating to reopen transport links
The agreement came as South Korea promised 400,000 tonnes of food aid for its impoverished communist neighbour.
They will also begin testing rail links between North and South.
The decision marks another step in a gradual process of reconciliation although travel between the two states will remain tightly restricted.
For five decades the border between the two Koreans was sealed tight, an impassable no-man's-land of minefields and tank traps.
But step by step links are being re-established.
At talks in the North Korean capital, Pyongyang, the two sides agreed to open two roads which have just been completed through the demilitarised zone, and test recently reconnected railway lines.
Only those on officially sanctioned business are allowed to enter the restricted zones near the border.
The two delegations also agreed to set up a joint agency to run an industrial park being built at the city of Kesong just north of the border.
It is being developed as an investment zone for South Korean business and is seen as a key test of economic co-operation.
The south has agreed to supply 400,000 tonnes of rice to the North, which depends on outside help to feed its own people.
The agreement comes the day after senior military officers reached an accord on reducing tension, particularly off the west coast where the two navies have clashed in recent years.
Analysts say that North Korea is anxious to please the south at a time when it's under pressure from the United States and its neighbours over its development of nuclear weapons.