South Korean President Moon Jae-in says North Korean leader Kim Jong Un has agreed to permanently dismantle a missile engine test site and a launch pad in the presence of international experts in what he described as a specific step toward denuclearisation.

South Korean President Moon Jae-in is in Pyongyang this week for a summit with Kim, the third this year.

The two leaders spoke at a news conference after signing a joint statement following their second day of summit talks in Pyongyang.

Moon said that the North agreed to take further steps such as permanently dismantling its main Nyongbyon nuclear complex if the United States takes corresponding measures.

South Korean media pool footage shows Moon told reporters Wednesday that Kim could visit Seoul this year.

If realised, he would be the first North Korean leader to visit Seoul since the peninsula was divided into North and South at the end of World War II in 1945.

Kim's late father, Kim Jong Il, had promised reciprocal visits when South Korean leaders visited him in Pyongyang in 2000 and 2007. But his Seoul trip wasn't realised before his 2011 death.

The two countries are also looking at putting in a joint bid for the 2032 Summer Olympics.