BEIJING - Pyongyang formally declared Kim Jong-un "supreme leader", as the country staged a massive memorial service on Thursday for Kim Jong-il to end a period of official mourning.

Analysts said the new leadership of the Democratic People's Republic of Korea (DPRK) has to engage more with the international community to overcome challenges and maintain the stability of the Korean Peninsula.

A huge military memorial parade was held in Pyongyang on Thursday and tens of thousands of people were in attendance in the city's main square.

Kim Jong-un, head bowed and somber in a dark overcoat, stood on a balcony at the Grand People's Study House overlooking Kim Il-sung Square during the memorial.

Kim Yong-nam, a member of the Presidium of the Political Bureau of the Central Committee of the Workers' Party of Korea and president of the Presidium of the Supreme People's Assembly, delivered a memorial speech saying that Kim Jong-il devoted himself to "the accomplishment of the revolutionary cause of Juche, national reunification and global independence". Juche means self-reliance.

He declared Kim Jong-un "supreme leader" of the party, military and the people during the government's first public endorsement of his leadership.

Analysts said the ceremony is a formal declaration of national support for the young Kim.

What Kim Yong-nam said sent clear signals that the party, government and military have accepted the young Kim as the central figure of its collective leadership, Wang Junsheng, an expert on Asian studies at the Chinese Academy of Social Sciences, said.

Experts said the young leader needs a stable external environment for the implementation of smooth domestic and foreign policies.

Countries should give incentives for the DPRK's stability and development, instead of provoking the new leadership, Chen Qi, an expert on East Asia studies at Tsinghua University, said.

Koh Yoo-hwan, an expert at Dongguk University, told Yonhap news agency that support from neighboring countries is important to Pyongyang's development.

"It is crucial for neighboring states to help the DPRK. To this end, the US, the Republic of Korea (ROK) and other nations can help it open up without its security being undermined.

"We need to assure the DPRK that opening will lead to economic achievements, which will then help strengthen the legitimacy of the new leadership."

The first test of the new leadership will likely be the third round of talks between the DPRK and the US that was originally scheduled for Dec 22 but postponed due to Kim Jong-il's death on Dec 17.

Experts said the postponed talks will likely be held in January.

Lim Sung-nam, Seoul's chief nuclear negotiator had a meeting with US special envoy to the DPRK, Glyn Davies, in Washington, days after Lim's talks with Chinese diplomats in Beijing.

In their first meeting since the death of Kim, the top ROK and US nuclear envoys agreed on Wednesday to resume talks with the DPRK if the "right conditions" are created, according to an official from the ROK.

The US State Department said Lim and Davies also discussed the possibility of sending food aid to the DPRK.

According to the New York Times on Tuesday, Pyongyang said that it wanted to restore scuttled agreements with Seoul that could channel extensive investments from the ROK.

Wang said Pyongyang wanted to use the opportunity to break the international blockade.

China said it was ready to work with the new leadership.

"We believe that the DPRK people will turn grief into strength under the new leadership," Foreign Ministry spokesman Hong Lei told reporters in Beijing.

The key to ease the tension is ROK-DPRK ties, said Huang Youfu, a researcher on Korean studies at Minzu University of China.

"If Pyongyang signals goodwill, I believe ROK President Lee Myung-bak will make a positive response to their bilateral relations during his New Year speech that is scheduled to be delivered on Jan 2."