Seoul grinds its teeth as Pyongyang rides high

With less than two months remaining before an agreement to neutralise North Korea's nuclear threat comes into effect, the South Korean Prime Minister warned yesterday that the deal would collapse if Pyongyang continued to reject replacement reactors from his country.

North Korea, meanwhile, was blithely detailing plans to invite the greatest number of foreign visitors in its history to a festival of sport and culture scheduled to start a week after the 21 April nuclear deadline. An organiser said in Peking that foreigners would even be allowed to stay with local families, an unheard-of concession in one of the world's most closed societies.

Last autumn. North Korea agreed with the United States to scrap its existing reactors, which produce large quantities of weapons-grade plutonium, in exchange for more modern light-water technology. Under the terms outlined in October, a contract should be signed by 21 April, but most of the practical details remain in dispute. Seoul's nervousness over the negotiations between its closest ally and its most bitter rival was allayed only by US insistence that South Korea would supply the replacement reactors, and that the North would have to agree to dialogue with the South.

Since then, however, Pyongyang has refused to negotiate - its latest ploy has been to demand an apology from the South Korean president, Kim Young Sam, for his failure to express sorrow at the death of the North's leader, Kim Il Sung, last July - and is insisting it will not accept reactors from the South.

Lee Hong Koo, the South Korean Prime Minister, issued his warning as Winston Lord, a senior American official, arrived in Seoul for three days of talks about the impasse. Sources in Washington have hinted that South Korea may be asked to agree to a face-saving formula, such as bringing in an American company to lend its name to the project, but the South Koreans, who are meeting 70 per cent of the $4bn (£2.6bn) cost, argue that their pride is also at stake. "We don't have any alternative - politically, financially or technically," one official said.

Seoul is likely to have to give in - an outcome implicit in Mr Lee's comment yesterday that South Korea would take a quiet approach. He said the South had no plans for annual military exercises with the US, codenamed Team Spirit, always denounced by the North as a preparation for war. The exercises were last held in 1992.

While the South grinds its teeth, North Korea is revelling in what it sees as success in forging a partnership with the US and previously hostile countries. According to a tour organiser, it expects 20,000 visitors for the festival, the biggest influx since the country was founded in 1948. South Korean passport holders will not be welcome, but visa requirements for others are being relaxed, especially for Americans and Japanese.