UN resolution vote

Reports of another possible test come as the council looks set to vote on Friday on a draft resolution that imposes tough sanctions on North Korea's weapons exports and financial dealings and allows sea and port inspections of cargo.

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Al Jazeera's Tony Cheng, reporting from North Korea's neighbour, China, said Pyongyang had been issuing hostile rhetoric, saying it would attack aggressively and offensively if further sanctions were imposed on the country.

He added that China, in particular, was wary of cracking down on a country that is already impoverished and isolated, fearing that economic sanctions could worsen conditions for North Koreans and cause hundreds of thousands of refugees to pour into China.

But the US special envoy on North Korea, said on Thursday that the US was determined to make sure that Pyongyang faced serious consequences for its growing missile and nuclear threat.

"The United States and our allies and partners in the region will need to take the necessary steps to assure our security in the face of this growing threat," Stephen Bosworth told the senate foreign relations committee.

But he also said Washington was committed to diplomacy and that Barack Obama, the US president, who seeks the North's "verifiable denuclearisation", wanted to talk to Pyongyang, either through six-party talks or directly.

North Korea has so far spurned the administration's attempts at engagement, Bosworth said.

Saying he believed that the North would come back to disarmament talks eventually, but not soon, Bosworth said that for now, North Korea would "suffer consequences if it does not reverse course".

"[But] in the interest of all concerned, we very much hope that North Korea will choose the path of diplomacy rather than confrontation," he said.

He also said the US had no hostility towards North Korea - as Pyongyang frequently charges in defence of its nuclear programme.

"As we have stated repeatedly, the United States has no hostile intent toward the people of North Korea nor are we threatening to change the North Korean regime through force."

Rent demand

Pyongyang says the Kaesong industrial park has been "thrown into a serious crisis" [EPA]

As the diplomatic wrangling continues, tensions on the Korean peninsula continue to rise.

North Korea has demanded a 3,000 per cent increase in rent and a 400 per cent increase in wages for 40,000 workers employed by South Korean companies at an industrial park in the North Korean border town of Kaesong.

The demands were made during talks between the two sides at Kaesong, an official said, threatening the biggest symbol of reconciliation between the two Koreas.

On Thursday, North Korean state media issued a statement saying relations between the two countries had reached the "phase of catastrophe" and that the Kaesong complex had been "thrown into a serious crisis".