North Korea today abruptly canceled economic and Red Cross talks with South Korea scheduled this month, blaming "provocative" war games that the South plans to conduct with U.S. forces starting in February.

But the North proposed that the two sides send vice premiers to the truce village of Panmunjom before Jan. 17 to discuss ways to get the dialogue back on track.

The announcement appeared to deal a serious blow to recent progress toward detente between the two Koreas, begun last fall when the North made an unprecedented delivery of flood relief aid to the South.

There was no immediate reaction from the South Korean government. Analysts in Seoul dismissed the possibility that it would cancel the annual "Team Spirit" exercise, which the South sees as a symbol of the U.S. commitment to defend it.

But with the South eager to keep the dialogue going, it was considered possible that it would agree to a meeting of vice premiers.

China, which reportedly has pressed its North Korean allies to improve relations with the U.S.-backed Seoul government, quickly backed the North's position on the exercise. A Foreign Ministry spokesman in Peking said it could only heighten tension on the peninsula and accused Seoul and Washington of betraying hopes for peace.

The North's message, conveyed to the South over a special telephone hotline, called "Team Spirit" a "provocative act and an insult to us who made a peaceful proposition." Conducting it during the talks served to create an "artificial obstacle" to progress, it said.

The United States and South Korea have conducted the exercise every year since 1976. About 200,000 troops will take part in this year's version, which will run from Feb. 1 to the middle of April. As with past exercises, it will presuppose a North Korean invasion and include amphibious landings and airlifting of U.S. reinforcements to South Korea.

North Korea has been invited to send observers to the exercises since 1982, a step Seoul maintains would reduce tension between the two sides. However, the North has refused to do so.