The two Koreas will hold their first summit in a decade late next month, as the North affirmed its commitment to denuclearise if its security is guaranteed and expressed willingness to resume dialogue with the United States, in a rare meeting with South Korean envoys.
US President Donald Trump, in response, tweeted last night that "possible progress (is) being made in talks with North Korea".
"For the first time in many years, a serious effort is being made by all parties concerned. The world is watching and waiting! May be false hope, but the US is ready to go hard in either direction!"
China's Foreign Ministry called for all sides to "seize the current opportunity" to promote denuclearisation of the Korean Peninsula.
The announcement from South Korea came after the delegation of five envoys, led by National Security Office chief Chung Eui Yong, returned yesterday from a two-day trip to Pyongyang that included a four-hour dinner with North Korean leader Kim Jong Un.
Mr Chung told a media briefing: "The North expressed willingness to engage in candid talks with the US to discuss denuclearisation and normalising ties with the US."
He said the North made it clear there is "no reason" for it to possess nuclear weapons if the regime's security is guaranteed and military threats against it eliminated, and that it would freeze provocations while dialogue is in progress.
For the first time in many years, a serious effort is being made by all parties concerned. The world is watching and waiting! May be false hope, but the US is ready to go hard in either direction!
US PRESIDENT DONALD TRUMP, in a tweet on talks between South and North Korea.
Both Koreas will also set up a hotline between their leaders to ease military tension and allow better communication.
This is the latest in a flurry of friendly gestures by the two Koreas to improve ties strained by Pyongyang's persistent nuclear and missile tests in the past two years.
South Korean President Moon Jae In sent envoys to Pyongyang to capitalise on the goodwill built during the Pyeongchang Winter Olympics, and to reciprocate a trip to the Games by Mr Kim's sister Kim Yo Jong, who delivered an invitation from her brother to Mr Moon to visit Pyongyang.
Mr Kim was seen beaming as he grasped Mr Chung's hands firmly in his office.
It was his first meeting with top South Korean officials since he assumed power in 2011, and also the first time a North Korean leader received South Korean guests in his office.
The North's Korean Central News Agency reported yesterday that Mr Kim "repeatedly clarified that it is our consistent and principled stand and his firm will to vigorously advance the North-South relations and write a new history of national reunification".
"He also made an exchange of in-depth views on the issues for easing the acute military tensions on the Korean Peninsula and activating the versatile dialogue, contact, cooperation and exchange," it added.
Mr Chung said that South Korea considers the visit "an important turning point" in improving ties and establishing peace in the peninsula.
He also said North Korea had "no particular demands" and just wanted "to be considered as a serious partner in dialogue".
The first inter-Korea summit was held in 2000, and the second in 2007.
Analysts said the summit would be a good step towards improving ties, but warned it is too early to judge if North Korea, which has walked out of dialogue with the international community several times in the past few decades, is sincere in its latest offer.
"The liberals will interpret it as a big friendly gesture from North Korea... but we should take their word with a grain of salt," Dr Park Jee Kwang of the Sejong Institute told The Straits Times.
He also noted that North Korea's leader has always insisted "no one can pressure us to give up our nuclear weapons".
"This kind of gesture in the past has gone down the drain. Nobody will trust their promises or consider this a big progress. We will need to watch and see if North Korea will take action and not just words."
Dr Park also urged the US not to make any concessions towards the North unless the regime were to allow an inspection of its nuclear arsenal first.
Dr Choi Kang of the Asan Institute for Policy Studies warned that South Korea's credibility as a US ally is at stake as it appears to have accepted Pyongyang's stance that denuclearisation is possible only if the US stops its hostile policies towards the regime.
"It is a total disaster," he said. "(The envoy's statement) gives North Korea legitimacy to stage provocations because the US refused to have dialogue with them.
"The US cannot trust South Korea anymore... (They will think) the Moon Jae In administration is so naive and appeasing, and they can't go with South Korea in dealing with the North anymore."