South Korea hailed a deal by South and North Korea to field their first joint Olympic team as a step towards unification, but critics cautioned on Wednesday uniting the peninsula was far more difficult than playing nice together.

Senior sports officials from North and South Korea agreed on Tuesday in Macau to compete as a single team for the first time at the 2006 Asian Games in Doha and then to field a single Korean team at the 2008 Olympic Games in Beijing [Images].

"The significance of this is we will be going onto the world stage as a unified team, and this will serve as a symbol of reconciliation and cooperation," a South Korean Unification Ministry official said by telephone on Wednesday.

Some of the more emotional recent moments at Olympics [Images] have been when North and South Korean athletes held hands and marched under one flag at the opening ceremonies of the Sydney Games in 2000 and Athens in 2004. They later competed for their own countries.

The two Koreas are technically still at war and have had decades of animosity and heated sports rivalry.

A South Korean Olympic committee official acknowledged on Tuesday that there was a mountain of issues to be worked out before the two Koreas can compete as a single team.

Working level officials will be meeting in the North Korean city of Kaesong in December to begin working out details on how to form a joint team, Olympic official Baek Sung-il said.

One of the key issues for the talks will be if a joint team will seek to have parity in its balance of athletes from the two Koreas or if it will produce the most competitive team possible.

South Korea, with a larger population and better-funded sports associations, has more world-class athletes than North Korea. In Athens, South Korea produced 30 medals, including nine golds, while North Korea tallied five in total and no golds.

"SPORTS IS AN HONEST BUSINESS"

A former Olympic athlete and now a coach said there was bound to be bitterness among athletes and coaches no matter what the officials work out on the members and budget for the team.

Hwang Young-jo, gold medal winner for South Korea in the men's marathon at the 1992 Barcelona Olympics, is concerned the selection process could favour North Korean athletes.

"You have to ask whether we will be forced to give in, which will be a big problem because we've always believed that sports is an honest business," Hwang told Reuters.

Some of the reasons North Korea may have decided to take part in joint teams with South Korea could include receiving funding for its athletic associations from counterparts in the South.

It also may be seeking the glory of rising in the medals chart, analysts said.

At Athens, it ranked 58th in terms of medals, but combining its tally with South Korea's would have resulted in 35 medals and placed it seventh overall between Germany [Images] and France [Images].

Sports has played an important part in North Korea's propaganda, but, unlike former East Germany, North Korea has yet to use sport as a route to international recognition.

West and East Germany remained tough rivals right up to unification in 1990. East Germany's sporting successes have been tainted by the subsequent knowledge some of its athletes used performance-enhancing drugs.

Ironically, the last time the two Germanys competed as separate countries at an Olympics was in Seoul in 1988.

Some analysts were sceptical that the two Koreas competing together in a single team could further unification, saying this may be a case where the political differences are too large to be bridged by sports diplomacy.

"Linking this to reunification is a long shot," said Lee Dong-bok, a Seoul-based expert on the North's negotiating tactics and a senior associate of CSIS think-tank.

(Additional reporting by Jon Herskovitz and Martin Nesirky)