(Corrects date of IAEA visit in final paragraph to March 13, not Tuesday)

By Jack Kim

SEOUL, March 4 (Reuters) - North Korea is fully prepared to shut down its nuclear facilities and allow inspections, a South Korean official said in New York, where envoys from Pyongyang and Washington are set to begin rare talks on improving ties.

North Korean Vice Foreign Minister Kim Kye-gwan has been on a visit to the United States since Thursday, becoming the highest-ranking official to do so since 2000.

"I don't think there's any doubt about the North's readiness to execute the initial steps," South Korean envoy Chun Yung-woo was quoted as saying in New York, referring to measures Pyongyang has agreed to on shutting down its nuclear activities.

"The North has agreed to the initial steps and has the intention to fully do its part," Chun was quoted as saying by South Korean media after he met Kim at a hotel on Saturday.

Chun, South Korea's chief nuclear negotiator, is accompanying Foreign Minister Song Ming-soon's visit to the United States.

IMPROVING TIES

Kim is scheduled to meet with U.S. Assistant Secretary of State Christohper Hill on Monday to discuss improving ties.

It will be the highest-level meeting on U.S. soil since a top military officer and North Korean leader Kim Jong-il's special envoy, Jo Myong-rok, visited Washington in 2000.

That was followed by U.S. Secretary of State Madeleine Albright's visit to Pyongyang and eased tensions -- until George W. Bush took office in 2001 and labelled North Korea as part of an "axis of evil".

In a breakthrough Feb. 13 agreement in Beijing, North Korea agreed with South Korea, the United States, and three other countries to shut down within 60 days its nuclear facilities and allow inspectors in return for 50,000 tonnes of fuel oil.

Further steps to completely "disable" its nuclear weapons programme will entitle the energy-strapped state to another 950,000 tonnes of oil or other forms of aid of equivalent value.

North Korea is also set to hold similar discussions with Japan in Hanoi next week, and separate meetings on energy aid are planned among the six countries in the international talks, which are China, Russia and Japan.

On March 13, International Atomic Energy Agency director Mohamed ElBaradei will be in Pyongyang to discuss the mechanics of North Korea's deal to close down its nuclear programme and readmit inspectors from the U.N. watchdog. (Additional reporting by Vienna bureau)

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