North Korean leader Kim Jong Il apologized Friday for his country's Oct. 9 nuclear test and said there won't be any more, South Korean newspapers reported.

Citing a diplomatic source in China, South Korea's Chosun Ilbo daily reported that Kim told his Chinese visitors "he is sorry about the nuclear test" and told them that Pyongyang had no plans for additional blasts.

"This is the most promising sign that we've seen so far from the North Korean regime and perhaps a signal that it is moving towards a point where it is willing to negotiate," CTV's Steve Chao reported Friday from Beijing.

It's the latest sign that international economic pressure is working.

And China is showing decreasing patience with its once-close ally, Chao said.

As part of the UN sanctions adopted following the nuclear test, China has started inspections of North Korean vehicles on its border, Chao reported. And on Friday, China's banks stopped all financial transfers to North Korea, "a potentially crippling blow," he said.

The enigmatic North Korean leader suggested Friday that international diplomatic talks might be possible if the U.S. pulled back on pressure for economic sanctions. The UN Security Council resolution adopted in response to North Korea's nuclear test has put a stranglehold on the country's access to foreign banks.

Since last November, Kim has steadfastly refused to join the U.S., China, Japan, Russia and South Korea in nuclear talks.

Sanctions and conditions

Pyongyang test-fired a volley of missiles in July and conducted the Oct. 9 nuclear blast in an effort to reinforce its negotiating position. Those provocations resulted in the strongest UN sanctions against North Korea to date.

Rice said Friday that the U.S. was willing to reengage the six-party talks on North Korea's nuclear program but that financial restrictions on Pyongyang would remain.

"The Chinese are emphasizing the need for six-party talks to begin again and for the North to re-engage in the talks," Rice told reporters in Beijing.

"They (North Korea) urged us to be open to returning to those talks without preconditions, which for us is not difficult," she said after talks with Chinese officials.

But North Korea wants the U.S. to agree to a precondition.

"Kim Jong Il also expressed to a certain degree with his Chinese envoy if the United States agreed to lift sanctions then perhaps he would be willing to go back to what is known as six-party talks or bilateral talks directly with the U.S.," said Chao.

Meanwhile, China urged the U.S. on Friday to be more flexible in their dealings with North Korea.

"This is in the interests of all sides and I hope the United States will take a more active and flexible attitude," Chinese envoy Tang Jiaxuan was quoted as saying during a meeting with Rice Friday.

Tang and other delegates met Kim on Thursday, before returning to Beijing for meetings with Rice.

He called on all countries to show political wisdom, return to dialogue and to re-engage the six-party talks, China's Xinhua news agency said.

Kim Kye Gwan, North Korea's chief nuclear negotiator, said Friday his country was amenable to a diplomatic solution.

"We believe that the nuclear test that we've already held gives us full deterrent, sufficient deterrent power, and we hope to return to six-party talks," he told ABC television in Pyongyang.

Kim Kye Gwan noted that North Korea has never said it plans to continue nuclear testing, although others have speculated it may be planning to do so.

The North is believed to have only enough to provide plutonium for about six bombs, and may be reluctant to use it for more tests. Pyongyang has always maintained that the aim of its nuclear program is to deter U.S. aggression.

Playing to the home audience

Kim's new-found penitence is for foreign audiences only, however.

According to a report from the North's official Korean Central News Agency, Choe Thae Bok, secretary of the Central Committee of the Workers' Party of Korea, told a rally of more than 100,000 people Friday that "No matter how the U.S. imperialists try to stifle and isolate our republic ... victory will be on the side of justice."

North Korea has typically encouraged its citizens to blame their desperate living conditions on forces outside their country, particularly the United States.

With files from The Associated Press