South Korea has accepted a North Korean proposal to hold working-level talks Sunday, but wants the venue changed to the border truce village of Panmunjom.
Pyongyang unexpectedly offered Thursday to hold talks on a pair of stalled joint commercial projects. It also suggested humanitarian issues were up for discussion.
Seoul responded by calling for ministerial-level talks in Seoul, but the North termed it premature to hold high-level talks and called for lower level discussions to be held in Kaesong. Pyongyang has not yet responded to South Korea's request to change the venue.
Talks between the two sides would mark a major reversal of tensions on the peninsula, which had been at their highest state in decades.
The North's statement Thursday said the talks between the two sides should include the possible re-opening of the Kaesong industrial complex, a jointly run factory north of the border that was shuttered in April amid heightened tensions. It also proposed discussing the resumption of cross-border tours to the North's Mount Kumgang resort. South Korea halted visits there after the 2008 shooting death of a South Korean tourist by the North's troops.
The statement said humanitarian issues, such as the resumption of separated Korean families, can be discussed, "if necessary." It also promised to reconnect a severed communications hotline with Seoul at the Panmunjom truce village, if the South agreed to the talks.
Korean relations sank to their lowest level in years following Pyongyang's rocket launch in December and nuclear test in February, moves that led to expanded United Nations sanctions against the North.