"We need ... to bite the bullet and find the way to talk to them (North Koreans), to talk to the Iranians, to talk to all other adversaries because without dialogue we are not moving forward," ElBaradei said at Georgetown University in Washington, after meeting with US Secretary of State Condoleezza Rice.

"I think in all these issues, dialogue is indispensable. I think we have to move away from the idea that dialogue is a reward; dialogue is an essential tool to change behavior," the IAEA director general said.

"Export control is not sufficient ... we really need to go and understand ... why these countries are tempted to develop nuclear weapons," the head of the UN nuclear watchdog said.

ElBaradei acknowledged North Korea's first nuclear test on October 9 was a "setback" for the international nuclear Non-Proliferation Treaty, but called it "a cry for help" by the North Korean regime, which believes its survival is threatened.

"I don't think sanctions work as a penalty," he said, in reference to UN Security Council sanctions imposed after Pyongyang's nuclear test.

In addition, he dismissed the idea that the test would have a domino effect in the region, pressing other countries, such as Japan and South Korea, to obtain their own nuclear weapons.

Iran is a different case, he said.

"From the Iran perspective, the key is to normalize relationships with the US," he said, adding that Iranians "would like to be respected, recognized as a regional power."

The State Department meanwhile rejected suggestions that Washington hold bilateral talks with North Korea over the nuclear issue, saying the method was used previously and failed.

Department spokesman Sean McCormack said "the idea that you deal with North Korea in a strictly bilateral sense is one that's been tried and, unfortunately, has failed."

The administration of US President George W. Bush had often cited the North's violation of its 1994 agreement with the previous Bill Clinton administration to justify the six-party talks in which the United States, China, South Korea, Japan and Russia deal jointly with North Korea.

The multilateral talks have stalled since November 2005.

McCormack said Washington could talk directly to North Korea only within the context of the six-party talks.

Calls for bilateral discussions with Pyongyang, including from within Bush's Republican party, have grown louder following North Korea's nuclear test.

McCormack also said that ElBaradei had discussed with Rice a proposed international nuclear fuel bank.

"We have very similar views in terms of international fuel supply guarantees," McCormack said at a briefing with reporters.

The proposed nuclear fuel bank being debated at the IAEA is aimed at deterring countries such as Iran from developing their own means of uranium enrichment to make reactor fuel and possibly nuclear weapons.

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