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According to Sky News, Kim said: "Now that North and South Korea made a decision to take the path of peace and prosperity, we insist that joint military exercises with outside forces should no longer be allowed and deployment of war equipment such as outside strategic assets should be completely stopped".

Nuclear talks between Washington and Pyongyang have stalled for months as they struggle with the sequencing of North Korea's disarmament and the removal of USA -led sanctions against the North.

Kim said that North Korea had already pledged not to make, use or spread nuclear weapons and had taken concrete steps to implement this.

Duyeon Kim, from the Center for a New American Security, told CNN that the New Year's message was "confident" and "normal", but added that the message to the US was clear: "He still sent a very firm word of caution, bordering a nuanced threat, that if Washington doesn't keep its Singapore promise and continues with sanctions, then he has Plan B in mind and will go his separate way".

As for Japan, it remains unclear if Kim is truly open to a meeting with Prime Minister Shinzo Abe, though he hinted previous year at the possibility "at an appropriate time", according to South Korea's Moon.

U.S. President Donald Trump hailed his June 12 summit in Singapore with Kim Jong-un as a breakthrough, and has expressed interest in a second meeting.

The North Korean leader made it clear that going back to saber-rattling is not what he wants: "If the US responds to our active and preemptive efforts with trustworthy steps and corresponding behavior, [North Korea-US relations] will move forward at an excellent and fast pace", he stated, as cited by Yonhap.

His televised address came at the end of a year which saw a historic summit with Donald Trump in Singapore in June.

He said: "You look at North Korea, we are doing really well - rockets aren't being fired missiles aren't being fired".

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The two leaders traded personal insults - Trump mocked Kim as "Little Rocket Man", who in turn called him a "mentally deranged USA dotard" - and threats of war as fears of conflict rose.

David Maxwell, a North Korea expert and senior fellow at the Foundation for Defense of Democracies think tank, called the speech and setting "a brilliantly crafted performance".

The two Koreas technically remain at war because the conflict ended in a truce - signed by North Korea, the United States and China - not a peace treaty.

However, US officials have indicated that the choking unilateral and worldwide sanctions against North Korea, enforced by the US, are to remain fully in place.

The statement jarred with Seoul's claim that Kim is genuinely interested in negotiating away his nukes and suggested that the North will potentially demand the United States withdraw or significantly reduce the 28,500 American troops stationed in South Korea, a major sticking point in any disarmament deal.

North Korea is entering the fourth year of a five-year economic plan that Kim announced with great fanfare at a rare congress of his ruling party in 2016.

"It means the two projects will be key agenda items concerning inter-Korean relations this year", the INSS report said.

The North is demanding sanctions relief - it is subject to multiple measures over its banned nuclear weapons and ballistic missile programmes - and has condemned USA insistence on its nuclear disarmament as "gangster-like".

The Seoul government shut down the joint industrial complex at the North's border town of Kaesong in 2016 in retaliation for Pyongyang's nuclear and missile provocations at the time. The program was considered an important source of foreign currency for the North.