North and South Korea began their first official talks in more than two years, focusing on the forthcoming Winter Olympics after months of tensions over Pyongyang's nuclear weapons programme.
North Korea said during rare talks with the South on Tuesday it will send a delegation to the Pyeongchang Winter Olympics in South Korea next month and Seoul said it was prepared to lift some sanctions temporarily to facilitate the visit if needed.
North Korean officials at the first formal talks with South Korea in more than two years said their delegation for the Games would consist of athletes, high-ranking officials and a cheering squad.
The talks are being closely watched by world leaders eager for any sign of a reduction in tensions on the Korean peninsula amid rising fears over North Korea's missile launches and development of nuclear weapons in defiance of United Nations Security Council resolutions.
South Korea has unilaterally banned several North Korean officials from entering the country in response to Pyongyang's ramped-up missile and nuclear tests, conducted despite international pressure.
But some South Korean officials have said they see the Olympics as a possible opportunity for easing tensions.
Foreign ministry spokesman Roh Kyu-deok said Seoul would consider whether it needed to take "prior steps", together with the UN Security Council and other relevant countries, to help the North Koreans visit for the Olympics.
At Tuesday’s talks, the first since December 2015, Seoul proposed inter-Korean military discussions to reduce tensions on the Korean peninsula and a reunion of family members in time for February's Lunar New Year holiday, South Korea's vice unification minister Chun Hae-sung said.
South Korea also proposed athletes from the two Koreas march together at the Games' opening ceremony and other joint activities between during the Winter Olympics, Mr Chun told reporters outside the talks.
Athletes from the two Koreas have paraded together at the opening and closing ceremonies of major international games before, although it has not been seen since the 2007 Asian Winter Games in China after relations chilled under nearly a decade of conservative rule in the South.
It would also be the first time since 2005 for the North to send its female cheerleaders, dubbed the "cheering squad of beauty" by South Korean media.
Military hotline restored
North and South Korea agreed to restore a military hotline on Tuesday that had been closed for nearly two years, an official said, less than a week after a cross-border civilian phone link was reopened.
The North said during the rivals' first formal talks in more than two years that a line in the western part of the border had been put back into action, Mr Chun told reporters in Seoul.
"Accordingly, our side decided to start using the military telephone line, starting 8am tomorrow," he said.
The telephone line was closed in February 2016 when Seoul announced a closure of the joint Kaesong industrial zone just north of the western border in a move that soured ties.
Another army hotline on the eastern side of the peninsula closed since 2008 - when Seoul suspended a tourism programme to Mount Kumgang, near the North's east coast - remained inoperational for technical reasons.
Both army hotlines were established between 2002-03 when the two Koreas enjoyed a rare moment of rapproachment under left-leaning South Korean presidents Kim Dae-Jung and Roh Moo-Hyun.
Tuesday's announcement came after the rivals resumed civilian communications through the border truce village of Panmunjom last Wednesday.
The civilian phone line, first established in 1971, was used to arrange inter-Korea government meetings to discuss key political and humanitarian affairs.
But it has suffered multiple disruptions, in line with the swings of volatile inter-Korea ties, having been suspended six times when tensions soared on the peninsula.
The meetings continued on Tuesday afternoon after the two sides broke up for separate lunches.
Officials began speaking at 10am (0100 GMT) in the three-storey Peace House just across the demilitarised zone on the South Korean side of Panmunjom truce village.
"North Korea said that they are determined to make today's talks fruitful and make it a groundbreaking opportunity," Mr Chun said.
Mr Chun also said the South Koreans proposed resuming negotiations over the North's nuclear program but there was no specific response from the North Koreans.
However North Korean officials said during the meeting they were open to promoting reconciliation between the two countries through dialogue and negotiation, according to Mr Chun.
The head of the North Korean delegation, Ri Son Gwon, said in opening remarks: "We came to this meeting today with the thought of giving our brethren, who have high hopes for this dialogue, invaluable results as the first present of the year ...."
North Korea entered the talks with a "serious and sincere stance", Mr Ri, chairman of the North’s Committee for the Peaceful Reunification of the Fatherland, said.
South Korean Unification Minister Cho Myoung-gyon expressed optimism as the meeting began.
"Our talks began after North and South Korea were severed for a long time, but I believe the first step is half the trip," Mr Cho said.
"It would be good for us to make that 'good present' you mentioned earlier.
"Everything feels slightly new as we have not had talks in a while."
Just before the delegation drove into the demilitarised zone, some 20 South Koreans were seen waving a banner that read: "We wish the success of the high-ranking inter-Korean talks."
One man was spotted waving a flag with a unified Korean peninsula.