UPDATE 2-N.Korea plans new rocket launch as leader asserts power

* North Korea to launch satellite between Dec. 10 and Dec.

22

* Second launch this year after April's failure

* Launch comes as S.Korea holds polls, Seoul says it is

"grave provocation"

* Chinese Communist Party delegation held talks with

N.Korean leader on Friday

SEOUL, Dec 1 (Reuters) - North Korea is to carry out its

second rocket launch of 2012 as its youthful leader Kim Jong-un

flexes his muscles a year after his father's death, in a move

that will likely heighten diplomatic tensions and draw criticism

from Washington.

North Korea's state news agency announced the decision to

launch another space satellite on Saturday, just a day after Kim

met a senior delegation from China's Communist Party in the

North Korean capital of Pyongyang.

China, under new leadership, is North Korea's only major

political backer and has continually urged peace on the Korean

peninsula, where the North and South remain technically at war

after an armistice, rather than a peace treaty, ended the

1950-53 conflict.

No comment on the planned launch was immediately available

from Beijing's foreign ministry.

Seoul's foreign ministry said in a statement that the move

was a "grave provocation". Japan's Kyodo news agency said Prime

Minister Yoshihiko Noda had ordered ministries to be on alert

for the launch.

"North Korea wants to tell China that it is an independent

state by staging the rocket launch and it wants to see if the

United States will drop its hostile policies," said Chang

Yong-seok, a senior researcher at the Institute for Peace

Affairs at Seoul National University.

North Korea is banned from conducting missile or

nuclear-related activities under United Nations resolutions

imposed after Pyongyang carried out nuclear tests, although it

says its rockets are used to put satellites into orbit for

peaceful purposes.

Washington and Seoul believe the isolated, impoverished

state is testing long-range missile technology with the aim of

developing an intercontinental ballistic missile capable of

carrying a nuclear warhead.

Pyongyang's threats are aimed, in part, at winning

concessions and aid from Washington, analysts say.

POLITICS AND ANNIVERSARIES

The failed April rocket launch took place to celebrate the

100th anniversary of the birth of North Korean founder Kim Il

Sung and the latest test will take place close to the Dec. 17

date of the death of former leader Kim Jong-il.

It will also come as South Korea gears up for a Dec. 19

presidential election in a vote that pits a supporter of closer

engagement with Pyongyang against the daughter of South Korean

dictator Park Chung-hee.

The April test was condemned by the United Nations, although

taking action against the North is hard as China refuses to

endorse further sanctions against Pyongyang.

North Korea is already one of the most heavily sanctioned

states on earth thanks to its nuclear programme.

Pyongyang has few tools to pressure the outside world to

take it seriously due to its diplomatic isolation and its puny

economy.

The state that Kim Jong-un inherited last December after the

death of his father boasts a 1.2 million-strong military, but

its population of 23 million, many malnourished, supports an

economy worth just $40 billion annually in purchasing power

parity terms, according to the U.S. Central Intelligence Agency.

"The North's calculation may be that they have little to

lose by going ahead with it at this point," said Baek Seung-joo

of the Korea Institute for Defense Analyses in Seoul.

Baek said the test planned for December would likely be no

more successful in launching a satellite than the April one that

crashed into the sea between China and North Korea after flying

just 120 km.

"Kim Jong-un may be taking a big gamble trying to come back

from the humiliating failure in April and in the process trying

to raise the morale for the military," Baek said.

North Korea's space agency said on Saturday that it had

worked on "improving the reliability and precision of the

satellite and carrier rocket" since April's launch.

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