North Korea has threatened to cut all relations with South Korea.

The Rodong Sinmun, the Workers' Party newspaper, said in a commentary Thursday that Pyongyang will have no choice but to make grave decisions, including ending all ties with the South, if the current Lee Myung-bak government continues to pursue what Pyongyang called reckless, anti-North Korea policies.

The commentary added that it is clear that inter-Korean ties cannot be normalized as long as the South seeks confrontation and war while violating key South-North agreements, including the June 15th Joint Declaration and the October 4th Summit Declaration.

However, the daily was quick to add that the North stands by its commitment to develop inter-Korean ties based on the key South-North agreements.

Observers say the North may be seeking to suspend inter-Korean projects involving the Gaeseong Industrial Complex.

The North has already suspended dialogue with the South and halted tours to Mount Geumgang.