At a fence-mending summit on Thursday, the neighbours agreed to turn the page on a bitter dispute over Japan's use of war-time forced labour.

South Korean President Yoon Suk Yeol, who has been keen to end the spat and present a united front against the nuclear-armed North, had flown to Japan to meet Prime Minister Fumio Kishida, the first such summit in 12 years.

According to a pool report, Yoon told Kishida he wanted a "complete normalisation" of a 2016 military agreement called the General Security of Military Information Agreement (GSOMIA), which enables the two US allies to share military secrets, particularly over Pyongyang's nuclear and missile capacity.

Following the summit, South Korea's foreign ministry was asked "to proceed with the needed measures to normalise the agreement," said a defence ministry official, who declined to be named.

The foreign ministry is expected to send a formal letter to its Japanese counterpart soon, the official added.

Seoul had threatened to scrap GSOMIA in 2019 as relations with Tokyo soured over trade disputes and a historical row stemming from Japan's 35-year colonial rule over the peninsula.

In response, an alarmed United States said that calling off the pact would only benefit North Korea and China.

Hours before it was set to expire, South Korea agreed to extend GSOMIA "conditionally", but warned it could be "terminated" at any moment.

Confronted with Pyongyang's growing aggression and flurry of missile tests, the neighbours have increasingly sought to bury the hatchet.

The increasing security challenge was thrown into sharp relief just before Yoon's arrival in Tokyo on Thursday as North Korea test-fired what it said was an intercontinental ballistic missile.

Last year, Pyongyang declared itself an "irreversible" nuclear power, and recently leader Kim Jong Un called for an "exponential" increase in weapons production.