South Korea and the United States Saturday agreed to continue President Kim Dae-jung's sunshine policy of engaging the Democratic People's Republic of Korea (DPRK)while maintaining defense readiness against any provocations.

The agreement was reached at a meeting by South Korean Defense Minister Cho Sung-tae and his U.S counterpart William Cohen, who arrived here Friday for a two-day visit.

However, the two sides pointed out that Pyongyang has undergone no major changes despite some positive developments in inter-Korean relations, including President Kim Dae-jung's Berlin declaration early this month, the U.S.-DPRK dialogue in New York and progress on resumption of normalization talks between Pyongyang and Tokyo.

The two countries agreed to deal sternly with any military provocations by the DPRK as the DPRK is likely to make provocations on the occasion of the April 13 general elections in South Korea and the first anniversary of the inter-Korean naval battle along the west coast last June.

At the meeting, Cho asked the United States to revise its foreign military sales (FMS) regulations to allow South Korean arms exports which are made with U.S. technology.

Cohen urged South Korea to take measure against the reduction of training grounds for U.S. troops in South Korea because of the expansion of urbanization in the country.

Earlier on Saturday, Cohen also held talks with President Kim Dae-jung and Foreign Affairs and Trade Minister Lee Joung-binn to discuss issues on the DPRK and regional security.