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Since then, the U.S. and North Korean nuclear envoys held an unusual one-on-one meeting in Germany last month where differences between the sides were apparently discussed, although no details of any concessions have been made public. Pyongyang and Washington held separate talks in Beijing late January on the financial issue, although it has yet to be resolved.

Unlike in the December talks, negotiators Thursday "were able to make progress in discussing denuclearization," Hill said.

The North's chief negotiator had said before the talks began that his country was "prepared to discuss first-stage measures" toward nuclear disarmament.

"We are going to make a judgment based on whether the United States will give up its hostile policy and come out toward peaceful coexistence," Kim Kye Gwan said on arriving in Beijing for the meeting at a Chinese state guesthouse.

American experts who visited Kim in Pyongyang last week said North Korea would propose a freeze of its main nuclear reactor and a resumption of international inspections in exchange for energy aid and a normalization of relations with Washington.

The North, which suffers from chronic power shortages, is also seeking electricity supply or an annual import of at least half a million tons of heavy fuel oil ¡ª the amount it had been promised under a Clinton-era denuclearization deal with the U.S.

North Korea and the U.S. agreed in 1994 for Pyongyang to freeze its plutonium-based nuclear reactor in exchange for energy aid. The North promised to eventually dismantle the facility following construction there of two light-water nuclear reactors for electricity ¡ª a type more difficult to divert for weapons use.

However, that deal fell apart in late 2002 after Washington accused North Korea of a secret uranium enrichment program. The North expelled international inspectors and restarted its reactor, and is believed to have amassed enough radioactive material for at least a half-dozen bombs.

The six-nation talks ¡ª involving China, Japan, Russia, the U.S. and the two Koreas ¡ª began in August 2003, but the North has twice boycotted them for more than a year. The latest was over a U.S. decision to blacklist a Macau bank where the North held accounts, saying it was complicit in the country's alleged counterfeiting and money laundering.

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