US begins war games with South Korea SEOUL: South Korea and the US began annual war games as North Korea shut down a border hot line after threatening to launch a preemptive nuclear strike against the two countries. The "Key Resolve" exercise is a rehearsal for a possible conflict on the Korean peninsula using computer simulation, South Korean Defense Ministry spokesman Kim Min Seok said Tuesday. While no unusual North Korean troop movements have been spotted, the totalitarian state will probably respond with its own military exercises soon, Mr Kim said. Tensions on the Korean peninsula are the highest since at least 2010, when 50 South Koreans were killed in attacks by the North. North Korean dictator Kim Jong Un's regime has increased its bellicose rhetoric since the United Nations Security Council tightened sanctions to punish North Korea for its nuclear weapons test in February. The guided-missile destroyer USS Lassen arrives to participate in the annual joint military exercises called Key Resolve. During a visit to a front-line artillery post on North Korea's Wolnae Islet today, Mr Kim expressed confidence in the unit's ability to turn South Korea's Baengnyeong Island into "a sea of fire," according to North Korea's official Korean Central News Agency. The location is significant because 46 South Korean seamen died in March 2010 after the naval ship Cheonan sank in waters near Baengnyeong, about 210 kilometres northwest of capital Seoul. An international panel said the North torpedoed the ship while the Pyongyang government denies any involvement. State of War "Now, every day is a state of war," Mr Kim was reported to have told the troops. It is imperative that each soldier here becomes excellent gunner. North Korea is combat-ready with strategic rockets and "diversified surgical nuclear strike mechanisms," the state- run Rodong Sinmun newspaper said Tuesday. "Today, on March 11, the armistice agreement is annulled," the newspaper said. Every citizen is a soldier. UN Response UN Secretary-General Ban Ki-moon called on North Korea to continue to respect the 1953 armistice, according to his spokesman Martin Nesirky. In any event, the accord doesn't permit either side to unilaterally abandon the accord because it was adopted by the UN General Assembly, he told reporters in New York. The US has taken the similar position in response to North Korea's statements. North Korea previously warned that the armistice accord "would be completely nullified" in response to the U.S.-South Korea military exercises, according to a statement from North Korea's Committee for the Peaceful Reunification of Korea. All of North Korea's personnel and weapons "including sophisticated nuclear strike means are in place for a final offensive for national reunification," according to the statement carried by KCNA. In New York, US President Barack Obama's national security adviser, Tom Donilon, said in a speech that the US, while open to talks with North Korea,"will not play the game of accepting empty promises or yielding to threats." Mr Obama will meet at the White House in May with newly inaugurated South Korean President Park Geun-hye, he said. Provocative Statements "Recently, North Korean officials have made some highly provocative statements," Mr Donilon said. North Korea's claims may be hyperbolic -- but as to the policy of the United States, there should be no doubt: we will draw upon the full range of our capabilities to protect against, and to respond to, the threat posed to us and to our allies by North Korea. That includes taking actions to prevent the transfer of nuclear weapons or nuclear materials to other states or non- state entities, he said. In Washington, the US Treasury Department today announced it is freezing any US assets of North Korea's Foreign Trade Bank, saying the institution facilitates transactions linked to the proliferation of weapons of mass destruction. The company, which is North Korea's primary foreign exchange bank, "facilitated millions of dollars in transactions" which benefited the country's premier arms dealer, Korea Mining Development Corp., the Treasury Department said. Great Strides South Korea, in its military exercises, will take the lead commanding 3000 U.S. soldiers and 10,000 of its own troops in the drills. About 2500 of the U.S. forces were deployed from the US Pacific Command headquarters in Hawaii. "It is the first time the ROK Joint Chiefs of Staff have planned and executed this combined exercise," US General James D. Thurman, head of the combined forces, said. In doing so, they are taking great strides to assume wartime operational control of forces in December 2015. "We're in a crisis situation with North Korea threatening war every day," South Korean President Park said today at her first Cabinet meeting since taking office in February. Close cooperation with the international community is crucial in making North Korea give up its nuclear weapons and make the right choice. Foreign Minister Yun Byung Se took office today saying the North Korean threat is the South's biggest challenge, while Unification Minister Ryoo Kihl Jae said in his inaugural speech that inter-Korean dialogue must continue "no matter how grave the situation." South Korea will consider the option of giving humanitarian aid to the North, independent of politics, he said. The North is not answering South Korean calls made today through the hot line at the Panmunjom border village inside the demilitarised zone separating the two countries, Unification Ministry spokesman Kim Hyung Suk said. "Severing communication with the two countries does not mean physical cancellation of the phone line, but the North ignoring overtures," Mr Kim said. North Korea said units of its armed forces rallied in three provinces March 9, according to a statement carried by KCNA. Armed forces held rallies in two provinces yesterday, according to a separate KCNA statement. Regional heads of the Workers' Party of Korea said it is the "final conclusion and will" to "settle accounts with the U.S.," according to the statement.