North Korea announced on Tuesday it had signed an agreement with Russia settling an estimated $11 billion debt owed by Pongyang that dates back to the Soviet era.

The North's state news agency KCNA said the agreement was signed Monday in Moscow, but gave no details of the terms involved.

"The North-Russian debt adjustment pact will pave the way for the two countries to further expand economic cooperation between them," the KCNA report said.

Russian Deputy Finance Minister Sergei Storchak had made a rare visit by a top Russian official to Pyongyang in May to discuss settling the outstanding debt.

Following his visit, Storchak confirmed that part of the settlement would involve investment in energy, health and education projects in the isolated Stalinist state.

The debt had been discussed in August last year at a rare summit in the Siberian city of Ulan-Ude between North Korea's late leader Kim Jong-Il and Russia's former president Dmitry Medvedev.