U.S. President Donald Trump proposed an American liaison office in Pyongyang to North Korean leader Kim Jong-un when they met in the border truce village of Panmunjom on Sunday.

"Trump expressed regret to Kim over the collapse of their summit in Hanoi in February and stressed the need to improve bilateral relations and resume negotiations," a diplomatic source said. "As part of that he broached the idea of opening a U.S. liaison office."

The liaison office, a first step to establishing formal diplomatic relations, was already on the agenda in Hanoi.

U.S. Special Representative for North Korea Stephen Biegun told reporters on the plane back to the U.S. there are "things we can do in the meantime" to make concessions to Kim such as "humanitarian aid, expanded people-to-people talks, presence in each other's capitals," according to political website Axios.

President Moon Jae-in in a Cabinet meeting Tuesday called the Panmunjom meeting a turning point to "end hostility and start a new peace era."

U.S. President Donald Trump talks with North Korean leader Kim Jong-un at the border truce village of Panmunjom on June 30. /Yonhap

But Biegun added in the off-the-record conversation that Washington wants a "complete freeze" of North Korea's weapons of mass destruction program while it is negotiating with Pyongyang. It also wants "an idea of an end state, and then within that we have a discussion of a road map" towards the North giving up its nuclear weapons.

He made clear that the U.S. "isn't ready to lift the sanctions against North Korea if it freezes its weapons program," according to Axios. "In the abstract we have no interest in sanctions relief before denuclearization," he said.

The first round of fresh talks between the U.S. and the North is expected to be held in Thailand early next month.

U.S. Secretary of State Mike Pompeo could meet North Korean Foreign Minister Ri Yong-ho during the ASEAN Regional Forum Foreign Ministers' Meeting on Aug. 2 in Bangkok. It is the only ministerial-level conference that officials from both countries attend.

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