"There is no particular reason to be optimistic but I've come prepared for serious discussions," James Kelly, the State Department's top Asia hand and Washington's chief negotiator, said on his arrival at Beijing airport.

"For the DPRK (North Korea), there is a great opportunity to signal their commitment to full-scale denuclearization.

"When they do this, this will open up all kinds of things politically, economically and diplomatically."

North Korea and the United States are deadlocked over allegations that the Stalinist state has a uranium-enrichment program.

While North Korea admits to having plutonium facilities, and has offered to freeze them in return for simultaneous rewards such as energy and food aid, it has denied the uranium claims.

The United States is insisting North Korea dismantle all its nuclear programs, including uranium, before it gets security guarantees and aid.

Despite the standoff, now in its 20th month, delegates in Beijing for the talks said North Korea was more responsive in discussions this week, but admitted differences were still hampering progress.

"North Korea seems to be willing to deepen discussions at the full session," said a Japanese official who participated in two days of working level talks that ended Tuesday.

North Korean leader Kim Jong-Il's comments last month in Pyongyang to Prime Minister Junichiro Koizumi on his willingness to freeze the nuclear program could signal greater flexibility by Pyongyang, Japanese envoy to the full session Mitoji Yabunaka said.

"As talks have come to the third round, we will make efforts to see as much progress as possible on the nuclear issue, taking into consideration the outcome of the prime minister's recent visit to North Korea," Yabunaka told journalists.

Host China, which held one-on-one talks with close ally North Korea Tuesday, said the preparatory sessions this week laying the foundations had proved "constructive" but issues still needed to be worked on.

"Although some consensus has been reached, important disagreements remain," said foreign ministry spokeswoman Zhang Qiyue.

A South Korean official said the talks starting Wednesday between the two Koreas, the United States, Japan, Russia and China would focus on "which elements (of North Korea's nuclear program) should be frozen" as a first step.

"There was agreement that specific discussion on the nuclear freezing which accompanies verification as the first step of the nuclear dismantling should continue at the main talks," he said.

South Korea's head negotiator Lee Soo-hyuck said he would be pushing Seoul's "three-stage resolution" as a way out of the standoff.

It envisages a pledge from North Korea to freeze all its nuclear programs in return for promises from Washington and its allies to meet Pyongyang's aid and security guarantee demands.

There would then be a gradual dismantlement of the nuclear programs coinciding with aid flowing to the impoverished country, followed by a normalization of relations between the two sides.

"We will make every effort to produce substantial progress from the third round (of talks)," said Lee.

The United States, South Korea and Japan are expected to hold a trilateral discussion of the plan ahead of the main talks that open Wednesday at 3:00 pm (0700 GMT) at the Diaoyutai State Guest House, officials said.

While a host of bilateral meetings are set for Wednesday, nothing is scheduled between North Korea's top negotiator Kim Kye-Gwan and his US counterpart Kelly.

Analysts are pessimistic that substantial progress will be made, citing lack of impetus by US President George W. Bush and North Korean leader Kim Jong-il ahead of the US presidential elections in November.

WAR.WIRE