North Korean leader Kim Jong Il held talks with the head of South Korea's Hyundai Group, the North's state media reported Sunday, in a rare meeting that could warm prospects for a resumption of stalled cross-border projects.
Meanwhile, North Korea warned the United States and South Korea of "merciless retaliation" over sanctions imposed on the communist country, and nuclear attacks in response to any atomic provocation.
Kim and Hyun Jeong-eun, Hyundai's chairwoman, had a "cordial talk," on Sunday, the Korean Central News Agency reported in a brief dispatch from Pyongyang, though it provided few details.
Just days earlier, the North freed a Hyundai worker whom it had detained for months. Pyongyang accused the worker of denouncing North Korea's government.