US and South Korean forces are prepared for any contingency, General Walter Sharp said in reference to reports of a possible launch.

"Many, many countries around the world are watching North Korea right now to see if it will act responsibly or not," Sharp told a press conference. "We call on North Korea to stop provocations and act like a responsible country."

South Korean President Lee Myung-Bak said earlier his government's policy will not change, despite increasingly strong threats from the communist state.

"I am very aware there are people who are concerned about the recent series of North Korean threats. But you do not need to worry too much," the president said in his regular radio address.

Lee said his government was ready for dialogue but would not rush into negotiations.

"I believe it is better to start off with a little difficulty, but ensure things are set right to reach a positive outcome, instead of trying to figure out what North Korea wants while saying all is well that ends well," he said.

"We are ready to work with North Korea. North Korea, too, must realise the South is the only country in the entire world that is sincerely concerned for its future and willing to help it."

North Korea has said it is scrapping peace accords with the South, including a 1991 pact recognising their Yellow Sea border as an interim frontier.

The announcement fuelled fears of clashes in the area, the scene of bloody naval battles in 1999 and 2002. The North's military has said it is adopting "an all-out confrontational posture to shatter" Seoul's government.

Last week US and South Korean officials said the North appeared to be preparing to launch its Taepodong-2 missile, which could reach Alaska.

US academic Selig Harrison, who recently visited Pyongyang, said last week that hawks had come to dominate defence policy since leader Kim Jong-Il's reported stroke last August.

Sharp said US and South Korean forces have contingency plans for any instability in the North "from the entire range of humanitarian disaster, to major civil war and potential loose nuclear weapons."

He gave no details.

Cross-border relations have worsened since Lee, a conservative, took office in February last year.

Lee rolled back his liberal predecessors' decade-long engagement policy towards Pyongyang, and said major economic assistance would depend on the North's willingness to scrap its nuclear weapons programme.

He also vowed to review summit deals signed in 2000 and 2007 between the North and his predecessors.

The policy has enraged the North, which has suspended dialogue and imposed tight border controls. On Sunday it said Lee's choice of Hyun In-Taek as new unification minister would cause relations to collapse.

Hyun, an architect of Lee's tougher policy, defended it at a parliamentary confirmation hearing Monday.

The previous government, he said, failed to dissuade Pyongyang from developing nuclear weapons. The North conducted its first atomic test in 2006.

Hyun said Lee's policy is not hardline but one of "co-existence and co-prosperity for both South and North Korea."

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