President Lee Myung-Bak's remarks followed a call by North Korea on Friday for an end to hostile relations with South Korea's key ally, the United States, and a nuclear-free peninsula.

"This year, South Korea and North Korea should create a turning point in their relations," Lee said in a nationally television New Year's address, suggesting the establishment of an inter-Korean dialogue body.

Inter-Korean ties have been strained since the conservative leader took office in 2008 and linked the South's massive aid and economic cooperation to progress in the North's nuclear disarmament.

Lee also repeated his call for North Korea to return "as soon as possible" to the six-party nuclear disarmament talks that Pyongyang quit nine months ago so that the two neighbours can improve their relationship.

"For this, there needs to be a standing dialogue organisation between the South and the North," Lee said, without elaborating on the proposed body.

"I wish North Korea can sincerely open their heart and walk on the path of dialogue and cooperation."

A presidential official told AFP Lee had proposed in an interview with The Washington Post in April 2008 that both Koreas establish "permanent high-level liaison offices" in each other's capital.

But the official fell short of confirming whether Lee meant the liaison offices in his proposal for an inter-Korean dialogue body.

On New Year's Day, North Korea, in a policy-setting joint editorial of its state newspapers, called for an end to hostile relations with the US and vowed to work towards a nuclear-free peninsula.

"The fundamental task for ensuring peace and stability on the Korean Peninsula and in the rest of Asia is to put an end to the hostile relationship between the DPRK (North Korea) and the USA," the editorial said.

"It is the consistent stand of the DPRK to establish a lasting peace system on the Korean Peninsula and make it nuclear-free through dialogue and negotiations."

North Korea left six-party nuclear disarmament talks in April last year in protest at international censure over its launch of a long-range rocket. In May, it staged its second nuclear test since 2006.

US envoy Stephen Bosworth visited the communist nation last month and reached a "common understanding" on the need to resume the talks, which group the two Koreas, Japan, China, Russia and the United States. However, no date has been fixed.

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