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North Korean leader Kim Jong Un oversaw a test of strategic cruise missiles, state news agency KCNA said on Monday, as South Korea and the United States kicked off annual military drills that Pyongyang sees as a rehearsal for war.

Kim visited a navy fleet stationed on the east coast to oversee the test aboard a warship, KCNA said, without specifying the date of his trip.

The launch aimed to verify the "combat function of the ship and the feature of its missile system", while improving sailors' capability to carry out an "attack mission in actual war", KCNA said, adding that the ship's missile hit its target.

Kim said the ship would maintain "high mobility and mighty striking power and constant preparedness for combat to cope with sudden situations," KCNA said.

South Korea's defence ministry said it had detected signs of the launch, but that the KCNA claims were "exaggerated" and "different from the facts", but did not elaborate.

The latest missile test came as South Korea and the United States began the Ulchi Freedom Shield summer exercises on Monday, designed to enhance their joint responses to North Korea's nuclear and missile threats.

Pyongyang has denounced the allies' military drills as a rehearsal for nuclear war.

South Korea's military has said this year's exercises will be held on the "largest scale ever", involving tens of thousands of troops from both sides, as well as some member states of the U.N. Command.

President Yoon Suk Yeol said the drills would feature several contingency scenarios, such as cyber, terror and drone attacks, and a disinformation campaign by the North.

"True peace is preserved only by overwhelming force, not by one-sided begging or goodwill," Yoon told a meeting of the National Security Council.

"North Korea talks about preemptive nuclear strikes and preparations for an offensive war, but we will immediately and overwhelmingly retaliate for any provocations."

South Korean lawmakers have said the North could test-fire an intercontinental ballistic missile or take other military action to protest the allies' drills or last week's summit of South Korea, the United States and Japan.

Over the past two years, North Korea has been testing what it calls "strategic cruise missiles," which some analysts have said could be tipped with nuclear warheads. While modernising and bolstering its naval power, North Korea showcased a new, nuclear-capable underwater attack drone in March.

Choi Il, a former navy officer who runs a think tank focusing on naval power, said the missiles can fly more than 1,000 km (621 miles) and hit land-based targets, and the new ship appears to be a corvette-class vessel, designed to minimise radar detection.

Aboard the ship, Kim vowed to reinforce the navy with improved combat efficiency and modern means of surface and underwater offensive and defensive capabilities, KCNA said.

"We would put spurs to the modernisation of naval weapons and equipment, including the building of powerful warships and the development of shipboard and underwater weapon systems," it quoted the leader as saying. (Reuters)