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class="articleBodyText"> <p>The United Nations, with the support of the U.S. and China, has responded appropriately to North Korea's brazen nuclear test and rocket launch with the passing of toughened sanctions. The U.S. and South Korea have strengthened military capacity at the Demilitarized Zone between the two Koreas and China has reportedly bolstered its troops along the Yalu River that forms the North's northern border.</p><p>     The prudent initial response has been to unleash the dogs of sanctions to convey condemnation to Kim Jong Un and his military so they do not inaccurately conclude the world is indifferent to their actions and repeat them.</p><div class="page_limit free"></div><div class="page_limit"></div><p>     What is needed next is a peace plan from the U.N., China or a country such as Canada, Switzerland or Australia that has the confidence of the key parties and that is not seen to have national security goals in the region. The benefits of peace are considerable and under normal circumstances, do not need restatement. But there is a risk that no attempt at peace will be made, as leaders remained seized by the same diplomatic paralysis that contributed to the chaos in Syria.</p><p>     Successful engagement with North Korea would dramatically reduce the chance of war, a nuclear accident or the state-sanctioned or private theft and sale of nuclear technology and resources to terrorists. The reallocation of military spending would allow the North and other concerned countries to better address poverty. The needs and well-being of the 24 million people of North Korea have been neglected in its national security strategy and those of other involved parties.</p><p>     There has also been a failure to recognize that solving the North Korean nuclear problem will deliver global benefits. In fact, the removal of this Cold War legacy should improve relations among the U.S., China and Russia.</p><p>     There is a real danger to assuming today, with the third generation of leadership in power in North Korea, that the same approach of sanctions and military alerts that the U.S. and its allies have turned to repeatedly since 1953 will lead to a safe outcome.</p><p>     The first conference since 1980 of the Workers' Party of Korea, the North's ruling party, will be held in May. The meeting could either lead to a dramatic set of positive reforms or to more belligerence.</p><p>     There are a few people with a relatively intimate view of North Korea who are predicting that reform is potentially on the horizon. It is not yet clear that such reports of market reforms are based on in-depth analysis or wishful thinking.</p><p><b>Building peace</b></p><p>In a first step toward creating a lasting peace, the U.N. should seek permission from North and South Korea to place peacekeepers on each side of the Demilitarized Zone to stand guard between the two armies. In the South, this force, under the command of Norway, Canada or another country not party to the nuclear dispute, would replace the U.N. Command that has remained since the Korean War.</p><div class="page_break auto free"></div><div class="page_break auto"></div><p>     In return, the North would be required to agree to full nuclear disarmament and a two-prong inspection process that will combine the best practices of the International Atomic Energy Agency with the enforcement capacity of Chinese, U.S. and Russian military inspectors on the ground. The North would also have to remove its commitment to nuclear defense from its constitution.</p><p>     Next, outside financial contributions and policy advice would back economic and social reforms in the North. The U.N., supported by the World Bank, the Asian Development Bank, the new Asian Infrastructure Investment Bank and national contributions, could deliver an aid package. Assistance can be linked to troop withdrawals and demobilization in North Korea.</p><p>     China's financial and military support for these first two steps will be critical. Equally important, China must share its experience reforming a socialist economy through market forces. China is now the third-largest financial contributor to U.N. peacekeeping and its participation in a North Korean mission would garner trust.</p><p>     The third step in the peace process would be a measured opening of the Demilitarized Zone, in an echo of the way Hong Kong-Shenzhen border controls loosened in 1979 with the start of Deng Xiaoping's "open door" reform policy. The opening of the demilitarized zone would lead to growth in economic ties between North and South Korea and could be expanded based on reforms within North Korea. The final step would be for the two Koreas to negotiate and conclude a formal peace agreement.</p><p>     The best timing for a peace plan is now while U.S. President Barack Obama is still in office and Chinese President Xi Jinping is able to capture the peace dividend that he stands to create with the demobilization of 300,000 members of the People's Liberation Army. Failure to act now would leave the Korean Peninsula in the hands of a new U.S. president and a China that will be too busy focusing on economic reforms.</p><div class="object-left"> <div class="object-left fb"> <div class="object-left"> <div class="js_enlarge"> <a href="javascript:%20void(0);" class="mwTrg" alt="zoom_106577"> <div class="image-side"> <img src="https://web.archive.org/web/20160602123345im_/http://asia.nikkei.com/var/site_cache/storage/images/node_43/node_51/2016/201603/20160307/john-gruetzner-headshot/4162878-1-eng-GB/John-Gruetzner-headshot_small_150.jpg" alt="" class=""><p class="date-area img-caption"></p> </div> </a> </div> <div class="modal-zoom" id="zoom_106577"> <a href="javascript:%20void(0);" class="js_close fb">Close</a> <img src="https://web.archive.org/web/20160602123345im_/http://asia.nikkei.com/var/site_cache/storage/images/node_43/node_51/2016/201603/20160307/john-gruetzner-headshot/4162878-1-eng-GB/John-Gruetzner-headshot_article_main_image.jpg" alt="" class=""></div> </div> </div> </div><p><i>John Gruetzner is managing director and founder of Intercedent, an investment and business advisory based in Beijing.</i></p> </div> </div> <div id="modal-screen_zoom"></div> </div> <div class="pagination no-border"></div> <div class="related-list"> <p class="related-header">Related stories</p> <ul class="point-list"> <li><a href="/web/20160602123345/http://asia.nikkei.com/Politics-Economy/International-Relations/North-Korea-sees-advantages-in-further-isolation">North Korea sees advantages in further isolation</a></li> <li><a href="/web/20160602123345/http://asia.nikkei.com/Politics-Economy/International-Relations/Antimissile-talks-put-heat-on-Beijing-to-rein-in-Pyongyang">Antimissile talks put heat on Beijing to rein in Pyongyang</a></li> <li><a href="/web/20160602123345/http://asia.nikkei.com/Politics-Economy/International-Relations/US-looms-behind-China-stance-on-North-Korea">US looms behind China stance on North Korea</a></li> <li><a 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