Kim Jong-il 'has life-threatening cancer'

North Korean leader Kim Jong-il has life-threatening pancreatic cancer, South Korean broadcaster YTN said today, citing information gathered from Chinese and South Korean intelligence sources.

The report fueled speculation about Kim's health while raising questions about the future of Asia's only communist dynasty and who will make decisions about its nuclear programmes. It also comes after a gaunt Kim, who was suspected of suffering a stroke a year ago, made a rare public appearance last Wednesday at a memorial for his father and state founder Kim Il-sung. The stark figure he cast heightened speculation the 67-year-old leader was still ill.

Kim's health is one of the most closely guarded secrets in the reclusive state. There has never been official confirmation of him falling ill.

YTN said the diagnoses of the cancer came around the same time as the stroke.

South Korea's National Intelligence Service declined to confirm the reports and the Unification Ministry said it had no information to back up the report. US officials did not immediately have comment.

The news hurt sentiment on Seoul's main stock index, which posted its biggest loss in more than four months amid renewed US financial and earnings worries.

"Such news highlights South Korea's geopolitical uncertainty and risks and one thing that investors hate is any uncertainty," said Lee Kyoung-su, a market analyst at Taurus Investment & Securities.

North Korea has been raising tension in Asia through missile launches and a nuclear test on May 25 which was met by U.N. sanctions aimed at cutting off it arms trade, one of its few sources of hard cash.

South Korean officials said the military grandstanding was aimed at helping Kim build internal support as he prepares for succession, with his youngest son seen as the likely heir.

The US National Cancer Institute puts the five-year survival rate for pancreatic cancer at 5.5 percent. The pancreas makes insulin and other hormones which help the body use or store energy from food.

Pancreatic cancer occurs more often in people who have diabetes than in those who do not, it said. Kim has long been thought to suffer from diabetes.

Kim Jong-il took power in 1994 when his father died at the age of 82. He assumed the title of general secretary of the ruling Workers' Party and chairman of the National Defence Commission, but has never taken the title of president.

His youngest son Kim Jong-un, born in late 1983 or early 1984 and educated in Switzerland, is regarded as the most capable of the North Korean leader's three known sons.

If Jong-un were to take over soon, he is likely to remain weak, vulnerable and at the mercy of the North's old guard for years, experts have said.

North Korea places great emphasis on seniority and the ruling elite around Kim Jong-il, mostly men beyond 70, are not about to take orders from the son, one intelligence source has said.

An expert on the North said Kim Jong-il had been planning for succession and relying on his brother-in-law and senior party member, Jang Song-thaek, to play a pivotal role.

"Everything is in place, and things are moving along at a quick pace and it will be done in a short period of time," said Paik Hak-soon of the Sejong Institute near Seoul.

Separately, Vice Foreign Minister Wu Dawei of China was holding talks in Seoul today to try to resume six-way talks his country hosts aimed at ending Pyongyang's nuclear arms programme in return for massive aid and diplomatic rewards.