After spending most of the week in a standoff over implied threats, North and South Korea have reportedly made progress on a number of economic projects.
South Korean reporters say North and South Korea managed to agree on cross-border railway links, and first steps toward building an industrial park in the North Korean city of Kaesong.
South Korea also reportedly agreed to send 400,000 tons of food aid to the North, which the North badly needs to feed its people.
The talks went into jeopardy after North Korea's chief delegate warned South Korea Tuesday of an "unspeakable disaster" if it joins the United States in confronting Pyongyang.
The remarks were an angry response to President Roh Moo-hyun's agreement with President Bush that "further measures" might be taken if North Korea did not give up its nuclear weapons programs.
South Korean reporters say Pyongyang has agreed to Seoul's demand to explain its threat of "unspeakable disaster." For its part, South Korea reportedly clarified what it meant by "further measures." So far, neither side is publicly saying how the comments should be interpreted.
North Korea still refuses to discuss its nuclear ambitions with South Korea, insisting it is a matter between it and the United States. It says it will abandon its nuclear programs in exchange for economic aid, and a non-aggression treaty with the United States.
Washington says Pyongyang must prove it has given up its nuclear weapons program before any U.S. concessions take place.