By Jon Herskovitz
SEOUL (Reuters) - North Korea's chief nuclear envoy will make a rare visit to the United States next month, a news report said on Friday, indicating long-stalled talks on ending Pyongyang's atomic ambitions could be back on track.
U.N. sanctions and a botched currency move that sparked inflation and civil unrest late last year have increased pressure on the destitute North to return to talks where it can win aid to prop up its wobbly economy by reducing its security threat.
Kim Kye-gwan, the face of the North's nuclear diplomacy, was expected to visit the United States in March, South Korea's Yonhap news agency quoted diplomatic sources in Beijing as saying.
The source said Kim planned to meet China's top envoy to the nuclear talks on Friday and return home the next day with a message from the North's biggest benefactor, Beijing.
Kim's visit to China coincided with an unusually busy week of diplomatic activity for the reclusive North that included high-profile visits by envoys from China and the United Nations, and leader Kim Jong-il reiterating he wanted a peninsula free of nuclear weapons.
Kim Kye-gwan's last trip to the United States was about three years ago and led a few months later to North Korea taking its first steps to disable the Soviet-era Yongbyon nuclear plant that produces bomb-grade plutonium.
THE NORTH AND ITS DISARMAMENT PLEDGES
North Korea later backed away from its disarmament pledges, expelled international inspectors, and produced a fresh batch of plutonium at Yongbyon that experts said could give it enough fissile material for one nuclear bomb.
"If Kim is going to Washington, he will be taking something in hand and we will likely see significant results related to the six-way talks," said Kim Yong-hyun, a professor of North Korean studies at Dongguk University.
North Korea has previously put conditions on its return to the talks, including ending U.N. sanctions and also having discussions with the United States on a peace treaty to replace the cease-fire that ended the 1950-53 Korean War.
Resuming the talks could ease concerns among market players about investing in the heavily armed peninsula, but was unlikely to cause any major movements on stocks or foreign exchange trading, analysts have said.
Investors, grown used to the mercurial ways of the North, expect no change in the "Korea discount," where equities, bonds and other assets are priced lower than regional peers on concerns that include risks from North Korea.
The top U.N. political envoy, Lynn Pascoe, scheduled to leave Pyongyang on Friday, said ahead of his visit he will discuss several issues including U.N. sanctions imposed to punish North Korea for a nuclear test last year.
(Additional reporting by Jack Kim and Christine Kim; Editing by Jonathan Thatcher and Ron Popeski)
