South Korea (search) urged the United States and its allies to be calm following North Korea's sudden declaration it is a nuclear power, reminding them that blustering and brinksmanship are nothing new in Pyongyang's toolbox of diplomatic tactics.

Yet South Korean officials also cautioned about further steps by North Korea (search) that could notch up the tension -- such as shipping weapons materials to other countries with nuclear ambitions or even testing a bomb.

The North's announcement and its decision to pull out of six-nation disarmament talks was "a matter of grave concern," South Korean Foreign Minister Ban Ki-moon told reporters in Washington, where he arrived on a previously scheduled trip to meet U.S. Secretary of State Condoleezza Rice (search).

But it is important to remember that "North Korea has shown similar attitudes in times of crucial negotiations" in the past, South Korea's Yonhap news agency quoted him as saying.

"We need to calmly analyze the situation," Ban said, noting the North's commitment to "solve the issue through dialogue and negotiations."

North Korea shocked the world by announcing Thursday that it has nuclear weapons (search) and will stay away from U.S.-led six-nation nuclear disarmament talks.

"We ... have manufactured nukes for self-defense to cope with the Bush administration's ever-more undisguised policy to isolate and stifle the [North]," the North Korean Foreign Ministry said in an English statement carried Thursday by the state-run Korean Central News Agency.

In Seoul, Vice Foreign Minister Lee Tae-shik told members of the ruling Uri party that "the North's move appears to be aimed at improving its negotiating power."

But he warned "the problem could get very serious if North Korea takes additional actions," according to Uri Party spokesman Lim Jong-suk.

Since the nuclear crisis erupted in late 2002, North Korea has steadily increased stakes in the standoff. It first removed U.N. seals on its mothballed nuclear facilities, expelled the last U.N. nuclear monitors, then quit the Nuclear Nonproliferation Treaty, and later said it had completed reprocessing 8,000 spent fuel rods to extract weapons-grade plutonium.

South Korea's take on what experts label North Korea's "bombshell announcement" reflects its decades-long experience in dealing with North Korean officials, who pepper their negotiating rhetoric with shouts, threats and dire warnings of imminent clashes.

In Australia, Prime Minister John Howard called North Korea's nuclear problem "one that has to be handled with a great deal of skill and balance."

"It's a quite dangerous situation," Howard told Nine Network television. "Now there's an element of bluff; I'm sure there's an element of exaggeration even if she does have some nuclear capacity."

Around the region, governments voiced concern over the North's latest hardline maneuver and urged a resumption of six-nation talks aimed at persuading North Korea to abandon its nuclear weapons program in return for diplomatic and economic benefits.

Since 2003, the United States, the two Koreas, China, Japan and Russia have held three rounds of talks in Beijing, but no significant progress has been made.

Hopes for the resumption of talks rose in recent weeks after U.S. President George W. Bush began his second term without using harsh word against the Stalinist regime. But to Pyongyang, Rice's labeling last month of it as one of the "outposts of tyranny" was insult enough to scuttle the diplomatic process.

North Korea's knack for surprising its negotiating partners was demonstrated by the timing of its announcement, which came on the last day of the lunar New Year's holiday and the first working day for Seoul newspapers. South Korean officials scurried to their offices to analyze and react to what local media called the "first New Year's gift from the North."

"I am personally stunned," said Ban, who was midair flying to Washington to discuss the resumption of disarmament talks when North Korea issued its statement.

In downtown Seoul on Friday, about 20 protesters chanting "Down with Kim Jong Il" burned a North Korean flag and waved pictures of the North Korean leader marked with large Xs.

The main opposition Grand National Party said Friday that North Korea's announcement illustrated intelligence failures by the current government, which has pushed for economic cooperation with Pyongyang to help foster reform.

"The government should find out the truth about North Korea, instead of talking loud with loose information," the party said in a statement.

"Pyongyang has to understand that in the eyes of the international community it is becoming the little boy who cried wolf," South Korea's Chosun Ilbo daily wrote in an editorial Friday. "Meanwhile one has to be suspicious whether the South Korean government, so optimistic that the six-party talks would restart right up to the moment when North Korea made its latest announcement, is properly reading the thoughts of the Northern authorities."

On Thursday, a senior South Korean Foreign Ministry official said that "no one except North Korea" has definitive information about the North's nuclear capabilities.