North Korea has accepted South Korea’s proposal to hold military talks to defuse border tension, after their first high-level meeting in two years.

It will also send a delegation to the 2018 Winter Olympic Games taking place in South Korea in February.

According to the South Korean government, an agreement was also reached to reinstate a military hotline suspended two years ago.

However, the North Korean delegation was negative on the subject of denuclearization, South Korea added.

The US gave a cautious welcome to the meeting.

The state department said the United States remained in close consultations with South Korean officials who would ensure North Korea’s participation in the Winter Olympics did not violate UN sanctions.

After a day of negotiations, both Koreas issued a joint statement which confirmed they had agreed to hold military talks on defusing military tension.

North Korea also agreed to send a National Olympic Committee delegation, athletes, cheerleaders, art performers, spectators, a taekwondo demonstration team and media to the games, while South Korea would provide the necessary amenities and facilities.

The statement also referred to exchanges in other, unspecified areas and other high-level talks to improve relations, South Korea’s Yonhap news agency reports.

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South Korea asked North Korea to end any hostile acts that might raise tension, while the North agreed there was a need to guarantee a peaceful environment on the peninsula, a statement from the South’s government said.

The South also proposed that athletes from both Koreas march together at the opening ceremony in Pyeongchang as they did at the 2006 Winter Olympics. It also pushed for the reunion of family members separated by the Korean War – a highly emotional issue for both countries – to take place during the Lunar New Year holiday, which falls in the middle of the Games.

South Korea said it would consider temporarily lifting relevant sanctions, in co-ordination with the UN, to facilitate North Korea’s participation in the Olympics.

North Korea’s reaction to these proposals is not known.

In his opening remarks, the head of North Korea’s delegation, Ri Son-gwon, was fairly neutral. He said he hoped the talks would bring a “good gift” for the new year and that his country had a “serious and sincere stance”.

Talks were held in the Panmunjom “peace village” in the demilitarized zone (DMZ) at the border.

Five senior officials on each side attended and the leaders of both were said to have watched the talks via a CCTV feed.

In his New Year address, North Korean leader Kim Jong-un had said he was considering sending a team to the Olympics. South Korea’s Olympics chief had said last year that North Korea’s athletes would be welcome.

Following Kim Jong-un’s overture, South Korea then proposed high-level talks to discuss North Korea’s participation, but the North only agreed to the talks after the US and the South agreed to delay their joint military exercises until after the Olympics. North Korea sees the annual drills as a rehearsal for war.

Some critics in the US see North Korea’s move as an attempt to divide the US-South Korea alliance.