(Bloomberg) — President Donald Trump downplayed Pyongyang’s latest actions, including missile tests, saying North Korean leader Kim Jong Un “is too smart and has far too much to lose, everything actually” if he acts in a hostile way toward the U.S.

Still, Trump said on Twitter that North Korea “must denuclearize as promised,” a day after its envoy to the UN said in a pointed statement that such a move was off the table. Trump said Kim signed a “strong Denuclearization Agreement” when the pair met in Singapore in 2018, although steps toward North Korea giving up its nuclear ambitions were never formalized.

North Korea said it conducted a “very important test” at its long-range projectile launch site on Saturday. The outcome of the test was “successful” and will play a key part in changing North Korea’s strategic position in the near future, the state-run Korean Central News Agency said in a statement Sunday, citing a spokesman at the Academy of the National Defense Science. It didn’t elaborate or say what was tested.

Not Dismantled?

The Sohae Launch Facility, which Kim once said he dismantled in a concession to Trump, was being monitored for possible missile or engine tests since a satellite image from Thursday showed new activity. A South Korean presidential official was reported as saying Sunday that the country is “closely watching” the situation after the test was announced.

The statement suggests that “it’s likely a test of a solid-fuel engine for intercontinental ballistic missiles,” said Kim Dong-yub, head of the research at the Institute for Far Eastern Studies in Seoul.

The latest provocation follows launches of a score of missiles this year alone, including two short-range ballistic missiles in late November. Kim has refrained from tests of nuclear bombs and missiles capable of carrying them to the U.S. for more than two years as he pursued unprecedented talks with Trump.

‘New Path’

But in recent months, he has warned that he would find a “new path” if the U.S. doesn’t ease up on sanctions and other policies that Pyongyang views as hostile. The Trump administration has called for North Korea to give up its nuclear weapons before it can receive rewards, a move Pyongyang sees as political suicide.

‘Diplomatic Solution’

“We keep a close eye on North Korea all the time,” Defense Secretary Mark Esper said on Saturday at the Reagan National Defense Forum in Simi Valley, California. “The best path forward with regard to North Korea is a diplomatic solution, a political agreement, that gets us to a denuclearized peninsula. That’s all in everybody’s interest.”

The two sides revived a war of words last week with Trump calling Kim a “Rocket Man” again, and a North Korean official bringing back the “dotard” nickname for Trump.

Pyongyang imposed a year-end deadline for the U.S. to propose a plan it would be satisfied with in return for its abandonment of a nuclear arsenal. Washington’s decision will determine what “Christmas gift” it will get from Kim and could prompt the North to take a “new path” from 2020, it warned.

Just a Trick

North Korea’s envoy to the United Nations said in a statement on Saturday that the “sustained and substantial dialogue” sought by the U.S. with Pyongyang was a “trick” done to suit its domestic political agenda.

“We do not need to have lengthy talks with the U.S. now and denuclearization is already gone out of the negotiating table,” Ambassador Kim Song said.

Trump abruptly ended a summit with Kim in Hanoi in February after the president said the North Korean leader asked for all U.S. sanctions to be lifted in exchange for the dismantling of the country’s main nuclear facility.

When new images showed that the North was rebuilding a long-range rocket site at the Sohae facility, just days after the summit collapse, Trump said he’d be very disappointed in Kim if it’s true.

–With assistance from Glen Carey and Jihye Lee.

To contact the reporter on this story: Kanga Kong in Seoul at [email protected]

To contact the editors responsible for this story: Shamim Adam at [email protected], Ros Krasny

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