Recent trade friction between the two Asian powerhouses has morphed into a dispute with political implications that go far beyond the region.
It was North Korea's sixth round of weapons launches since late July when it began stepping up its weapons demonstrations.
South Korean President Moon Jae-in said Seoul will "gladly join hands" if Tokyo chooses dialogue as the two nations deal with an escalating trade row.
South Korean President Moon Jae-in said Japan imposing tighter export curbs against Seoul will undermine Japan's international credibility for using its industrial advantage as a weapon against another country.
As the trade battle between South Korea and Japan drags on, Seoul announced it will cut down its economic dependence on Japanese industries.
The recent tensions between the two countries stem from more than six decades of resentment.
South Korean President Moon Jae-in replaced both of his top economic policy aides, Kim Soo-hyun and Yoon Jong-won.
North Korean state media called on the United States on Tuesday to "withdraw its hostile policy" and threatened that agreements made at the Singapore summit a year ago might become "a blank sheet of paper."
The call for "full combat posture" by Kim Jong Un came while the United States announced it had seized a large cargo ship for carrying an illegal shipment of coal.
South Korea's economy unexpectedly shrank in the first quarter, marking its worst performance since the global financial crisis.
South Korea announced a proposed 6.7 trillion won ($5.87 billion) supplementary budget on Wednesday to tackle unprecedented air pollution levels and to boost exports bruised by weak external demand amid the Sino-U.S. trade war.
The South Korean city of Gwangju has seen a steady exodus of manufacturing jobs move to low-cost countries. Many job seekers say they would work for the plant in a heartbeat.
U.S. President Donald Trump on Thursday expressed a willingness to hold a third summit with North Korean leader Kim Jong Un but said in talks with South Korean President Moon Jae-in that Washington would leave sanctions in place on Pyongyang.
North Korean leader Kim Jong Un said his country needs to deliver a "serious blow" to those imposing sanctions by ensuring its economy is more self-reliant, state media Korean Central News Agency (KCNA) said on Thursday.
South Korea's President Moon Jae-in has replaced his unification minister in charge of relations with North Korea and appointed a longtime confidant, Moon's office said on Thursday.
Under Kim Jong Un, North Korea has conducted its most powerful nuclear test and launched its first-ever intercontinental ballistic missile.
South Korean President Moon Jae-in's approval ratings have been falling and the prospects of re-starting some inter-Korean projects have dimmed, said Alison Evans of IHS Markit.
South Korea's unemployment rate jumped to a nine-year high in January as more people shunned low-paying work in the face of rising minimum wages, putting further pressure on the economy and deepening policy frustrations for President Moon Jae-in.
North Korean leader Kim Jong Un spoke highly of U.S. President Donald Trump, state media said on Thursday, and expressed satisfaction over the results of talks between officials from both countries about a second summit between Kim and Trump.