AFP - North Korea said on Sunday it was abandoning efforts towards nuclear disarmament in response to US-South Korean military exercises and would be free to build up its nuclear forces.

The announcement, carried by the official KCNA news agency, came from a spokesman for the North's army mission at the inter-Korean border on the eve of the US-South Korean exercises, titled Key Resolve/Foal Eagle.

It said all military talks with the United States and South Korea would be suspended during the exercises, which involve 10,000 US troops stationed in South Korea plus 8,000 from abroad and last from March 8-18.

"It is illogical to sit face to face with the dialogue partner who brings dark clouds of a nuclear war while levelling its gun at the other party, and discuss 'peace' and 'cooperation' with him.

"The process for the denuclearization of the Korean Peninsula will naturally come to a standstill and the DPRK (North Korea) will bolster its nuclear deterrent for self-defence," the statement said, alleging that the exercises were actually "nuclear war exercises".

The North is entitled "to counter with powerful nuclear deterrent," it added.

The North already warned on March 2 that the annual US-South Korean exercise would torpedo efforts to rid the peninsula of nuclear weapons and vowed to beef up its arsenal if necessary.

The North, which tested its first atomic bomb in 2006, conducted a second nuclear test last May, triggering harsh UN sanctions.

In recent weeks diplomatic efforts have intensified to revive six-nation nuclear disarmament negotiations that the North abandoned last April.

But the North demands UN sanctions be lifted before it returns to the six-party dialogue. It also wants a US commitment to discuss a peace pact to replace the armistice that ended the 1950-1953 war.

The North routinely criticises war games in South Korea as a rehearsal for invasion, while Seoul and its ally Washington say they are purely defensive.