TOKYO -- A senior North Korean trade official is visiting Japan to explain to the business community the economic reforms that the communist state implemented recently, a Korean official said on Monday.

Kim Yong-sul, a vice minister at the North Korean Trade Ministry, is expected to seek badly needed foreign investment following the changes, seen by some analysts as a first step toward a market economy.

Kim has been on an unofficial visit since Saturday and will hold talks with Japanese businessmen and ethnic Korean residents engaged in joint ventures with North Korea, said an official at the General Association of Korean Residents in Japan (CHONGRYON), the North's de facto embassy in Japan.

Japan and North Korea have no diplomatic relations.

Kim's visit comes as senior Foreign Ministry officials of the two former foes held their highest-level talks in two years in Pyongyang.

The two-day talks, which ended on Monday, are the latest in North Korea's recent diplomatic initiative which has included ministerial level talks with South Korea and a visit to Russia last week by its reclusive leader, Kim Jong-il.

In July, Pyongyang scrapped ration coupons, raised prices and wages and devalued its currency by 98 percent, changes analysts say cannot succeed without foreign investment and more trade.

In addition to meetings with businessmen, Kim Yong-sul will visit a Tokyo fish market and travel to the western metropolis of Osaka during his stay, which lasts until September 3, Reuters quoted the CHONGRYON official as saying.