Much was at stake for both leaders at their meeting.

North Korea badly needs financial help at a time when it is experimenting with market reforms for its wrecked command economy.

Mr Kim is also feeling the heat from the United States which counts North Korea as part of its "axis of evil".

Better ties with Washington's main ally in Asia could help relieve the pressure.

Mr Kim agreed to extend indefinitely a moratorium on ballistic missile tests. He also agreed to abide by international agreements on North Korea's nuclear programme - gestures aimed at the US as much as Tokyo.

But they are minimal steps and will not be enough to win over the highly sceptical Bush administration.

The worry in Washington is that Japan will give away too much to North Korea.

The communist state can expect a massive aid package from Tokyo if their relations are normalised - and the talks are due to start within a month.

Troubled relations
Aug 1910 - Japan colonises Korea
Aug 1945 - Japan surrenders in WWII; Korea is partitioned
Sept 1990 - Japanese PM apologises to N Korea
Jan 1990 - first round of normalisation talks
Aug 1998 - N Korean ballistic missile flies over Japan; Tokyo imposes sanctions

Sept 2002 - the Pyongyang talks

Mr Kim will probably see the meeting in Pyongyang as something of a triumph - a key step in efforts to preserve his beleaguered regime.

Mr Koizumi, though, will have mixed feelings about the outcome.

He has helped resolve the mystery of the missing people - although many more questions remain to be answered.

But he will be severely criticised if he offers aid to the North.

"The North Korean Government has confessed it's a terrorist country, it's ridiculous for us to assist such a regime - I've very angry about it," said Yoriko Koike, an MP for the New Conservative party in Japan's ruling coalition.

Relatives of those now confirmed to have been kidnapped are devastated and bewildered by the news from Pyongyang.

They have strong political and media support and are already demanding Japan give nothing away.

The normalisation talks may not be as straightforward as North Korea imagines.

It has waited for years to play the Japan card - a way to break out of its diplomatic isolation and the promise of massive economic help.

It badly needs success at a time when the US is running out of patience with its brinkmanship over various weapons programmes.