Leaders of divided Koreas to hold formal talks

SEOUL, Oct 3 (Reuters) South Korea's president will hold formal talks with reclusive North Korean leader Kim Jong-il tomorrow, after the second summit of two states technically still at war got off to a cool start.

Roh Moo-hyun has said he wants the summit to ease tensions between the foes along the Cold War's last frontier and help boost the economy of his northern neighbour.

He was greeted today by Kim, who barely spoke to the South Korean leader on arrival in Pyongyang -- only the second head of state from Seoul to visit the communist state.

The greeting was in sharp contrast to Kim's effusive welcome for South Korea's then-president, Kim Dae-jung, at the first summit in 2000. Then, the two leaders rode together in cars, embraced, held hands and harmonised in singing patriotic songs.

Roh's critics say the visit is aimed more at domestic politics and expect him to avoid the issues of nuclear weapons and human rights abuses so as not to offend his paranoid host.

North Korea is in the midst of international negotiations to give up its ambition to be an atomic weapons power in exchange for massive aid and an end to its pariah status.

The Pyongyang meeting coincides with a day of commemoration by both Korean states tomorrow marking the legend of the foundation 4,300 years ago of the Korean nation.

That nation was ripped apart after World War Two, when US and Soviet troops occupied the two halves of the peninsula.

Millions later died in the fratricidal 1950-1953 Korean War, for which a peace treaty has yet to be signed.

PEACE Roh, with just five months left in office, has said his priority is to bring peace to the peninsula and may seek to sign some sort of peace statement with the North.

South Korea's ability to seek a peace treaty is limited because it refused to sign the 1953 armistice agreement. The pact was signed in its stead by Washington on behalf of the United Nations Command, grouping forces of more than a dozen countries who had battled the North Korean and Chinese armies.

US President George W Bush says he is ready to discuss a peace treaty once the reclusive North scraps its atomic arms and so removes one of the region's greatest security threats.

Officials said Roh might propose new projects to rebuild the North's infrastructure and develop joint economic zones where its manufacturers could further exploit cheap land and labour.

Many analysts say the Seoul government is less fearful of the North's military threat it has lived with for decades than of its neighbour's collapse and the impact that would have on its own economy, Asia's fourth largest.

That in turn means, they say, that it sees spending billions on the gradual rehabilitation of the North Korean economy as in its own best interests. Several top businessmen are among the 200 or so South Koreans who travelled with Roh to Pyongyang.

Roh is expected to witness one of the North's typical mass games extravaganzas featuring goose-stepping soldiers, dancing schoolgirls and a large flip card animation section that promotes unification under the North's communist banner.

He returns to South Korea on Thursday.

REUTERS RS KP2252