"The Chinese have agreed to start a formal non-proliferation dialogue and the details are being worked out," said the official, adding that he expected the talks to begin "soon".

A second State Department official contacted by telephone said the talks would likely take place next month.

"We hope to find mutually convenient dates in July to hold discussions on arms control and non-proliferation issues," he said.

The senior official pointed out that China's view on US interest in creating a national missile defense system was that it would negate Beijing's nuclear deterrence, and would "start to ante up an arms race" in the region.

In Beijing, a top government spokeswoman on Tuesday also hinted the Chinese leadership would object to Russia and Europe developing a joint anti-missile system to balance the US' proposed system.

Discussing cross-Strait relations, the State Department official noted that since the May inauguration in Taiwan of pro-independence candidate Chen Shui-bian, there had been some loosening in Beijing's attitude on the definition of its "One China" policy.

"There is a slightly increased amount of wiggle room in there," said the official, who spoke with first-hand knowledge of Asian affairs.

Beijing previously has threatened military action if Taiwan does not adhere to the principle which describes Taiwan and the mainland as part of the same nation.

Chen has said everything, including "One China", should be up for discussion.

"(There's) enough overlap in points of view that I think we can have some talks," the official said, but declined to predict when the talks could begin.

Taiwan's top official handling relations with rival China is to visit the United States next week to seek Washington's support for the new government's mainland policy, Taipei news reports said Tuesday.

Taiwan has been one of the focal points in the US relationship with China since Washington recognized Beijing in 1979, and has frequently flared into heated exchanges between the three parties.

According to the official, who spoke on condition of anonymity, Washington has strived hard to keep the Taiwan issue rhetoric down while working on constructive solutions to the tense cross-Strait relationship.

The United States "is trying to encourage patience and prudence," he said, adding that "creativity on the One China policy ... will probably be the basis of talks."

Speaking to President Bill Clinton's stated belief that deeper trade ties with China and Beijing's eventual accession to the World Trade Organization would improve the rule of law in that country, the official cautioned the process would be a long one.

He did say, however, that Beijing's tight control was slipping as it struggled to keep up with its own fast-paced economy.

"The new economy and global economy is based on a sort of free-wheeling operation, free information flow and open markets. A lot of facets of Chinese business are occurring in this manner, and the politics are having a hard time keeping up."

"I'm not going to rule out whatever steps might be necessary for us to assure that the American people are safe and secure," including withdrawing from the 1972 accord, the Democratic White House contender told ABC television.

"We should keep our options open," Gore told the network's "Good Morning America" program during a campaign sweep through this state, which weighs heavily in the outcome of November's presidential elections.

Russia and China have vehemently objected to a proposal by Washington to develop an NMD system. During a visit to Rome on Monday, however, Russian President Vladimir Putin called on the European Union and North Atlantic Treaty Organization to join forces with Moscow and set up a joint anti-missile shield.

The US vice president said he backed "a modest, affordable and limited system" of defenses aimed at neutralizing the threat from so-called "rogue states" like North Korea that are developing missiles.

On Monday, Gore told reporters that Moscow would "eventually" agree to modify the treaty, which has played a bedrock role in US-Russian arms control accords.

"There's a difference between ripping it up and throwing it away and making some small modifications to it," he told reporters.

"The hermit kingdom has become the hyperactive kingdom," US Assistant Secretary of State for East Asian and Pacific Affairs Stanley Roth said, referring to a string of recent overtures by Pyongyang to foreign governments and organisations.

Roth warned however that it was still too early to judge whether the flurry of diplomatic activity would herald a permanent remodelling of the uncompromising Stalinism that North Korea has clamped on its people for decades.

"There is no doubt that North Korea is changing -- notice I don't use the word reforming," he said, adding that there were few signs of economic or political liberalisation in Pyongyang.

"It is way too early to say that North Korea has reformed, but I think certainly its diplomacy is changing, that seems to reflect a decision that it has to change for the country's well being," Roth told defence writers.

A surprise visit to Beijing by North Korea's reclusive leader Kim Jong-Il last month was the latest and most visible sign so far of Pyongyang's diplomatic emergence.

As it battles crippling food and energy shortages which have reportedly killed thousands of people, North Korea has moved to normalise relations with Italy and Australia this year, and sought better ties with the European Union and the Philippines.

North Korea has also applied to join the ASEAN regional forum, East Asia's premier body for dealing with security issues.

Talks with the United States on Pyongyang's missile threat and with Japan on opening diplomatic relations have also taken place in recent months, but there has reportedly been little progress.

Roth warned Tuesday that despite the apparent easing of tension on the Korean peninsula, the risk of conflict was still acute, given Pyongyang's "huge military establishment."

"What you have is enormous (military) capability (and) major economic vulnerability." he said.

The United States, which maintains a 37,000 strong garrison in South Korea, has led international pressure on Pyongyang to halt its development of missiles and nuclear arms.

Washington is concerned that as well as threatening South Korea and Japan, North Korea's missile program could eventually pose a security risk to the US mainland.

The perceived threat, multiplied by a long-range ballistic missile test by North Korea in 1998, has been highlighted in debate here over a proposed missile shield designed to protect the United States from so-called "rogue states."

Kim is due to meet South Korean President Kim Dae-Jung in Pyongyang for a first-ever summit on June 12-14.

Officials here said Tuesday that President Clinton would meet Kim Dae-Jung during his visit to Japan on Thursday for a memorial service for late Japanese prime minister Keizo Obuchi.

"They will be discussing the upcoming summit. We have a high level of confidence in the way Kim Dae-Jung has been approaching the North, and this will be an opportunity to reemphasize that," said a senior administration official.