ON Nov. 25, North Korea announced it will allow the International Atomic Energy Agency (IAEA) to inspect its nuclear facilities once the United States begins its planned removal of nuclear weapons from South Korea. At the opening of high-level talks Dec. 10, the North and South made separate proposals for a nuclear-free Korea. These are important steps, but much more is required to ensure that nuclear weapons do not spread in Asia.As a start, the world community needs to ensure that North Korea follows through. Experts have estimated that North Korea may be within a year or two of nuclear-weapons capability. North Korea has no nuclear power plants, but it has built one "research" reactor and has another under construction. Using uranium mined in North Korea, the first of these might create plutonium sufficient for about one bomb annually. North Korea, although it signed the Non-Proliferation Treaty in 1985, hasn't allowed the IAEA to inspect these plants, as the treaty requires. Though IAEA inspections would be a positive step and would determine the nature of the facilities, the inadequacy of these inspections cannot be ignored. Only sites designated by the inspected country can be visited; the discovery of Iraq's secret weapons sites after the Persian Gulf war has made the limitations of this rule clear. Another lesson from the Gulf war affects the Korean situation. The U S bombed Iraq's nuclear facilities without being widely criticized. Soon after, Lee Jong Koo, South Korea's defense minister, threatened a military attack on the North Korean facilities. While the South Korean government quickly repudiated the threat, many observers saw it as an intentional message. This is a dangerous trend and reinforces the tendency toward unilateral military attempts to solve international disputes. Despite Lee's threat, the basis now exists for a workable approach that could be a model for long-term solutions to nuclear proliferation elsewhere. The outlines of a deal are becoming clear. President Bush's decision to withdraw all US tactical nuclear forces from South Korea was a breakthrough. He has also promised US conventional-force reductions, provided the North agrees to IAEA inspections. Other hopeful trends include the efforts to increase ties between North and South. North Korea in October 1991 accepted a framework for a reconciliation process with the South and agreed to begin to work on reunification. Talks on reuniting the Koreas are continuing. With North Korea's shrinking ability to match South Korea's forces and with no more Soviet nuclear umbrella, the relatively cheap alternative of nuclear weapons may seem compelling to the North. To ensure that North Korea forgoes nuclear weapons may require a sophisticated combination of mutual military stand-down and economic incentives and sanctions. OW is the time to deal with the issue decisively, before bombs are built and while there is positive momentum. The world community has leverage over North Korea. It should agree on trade liberalization if North Korea makes a deal that would assure no weapons-production preparations - and economic sanctions if it does not. Military action, by a United Nations force, should be a last resort. In any deal, South Korea and other nations will need to accept the same requirements that they levy on the North. These should include more stringent inspection rules than IAEA's and an immediate ban on reprocessing on the Korean peninsula. These limits would affect Japan, which is accumulating large quantities of plutonium. Japan claims it is for civilian use, but the amount of plutonium being acquired seems to far exceed civilian needs. Japan has the expertise to build nuclear weapons very quickly. Would it consider North Korea's acquisition of a nuclear device sufficient reason to do so? Japan says it considers North Korea's facilities a major threat, especially in view of North Korean efforts to increase the range of its Scud-B missiles to include Japan. If Japan became a nuclear power, existing nonproliferation structures and mores would be seriously threatened. Eventually, the US nuclear arsenal will need to be dealt with as well. Moving toward a world in which disputes are settled through negotiation rather than force, and in which the standards of behavior for large nations are the same as for small, are probably the only nonproliferation measures that, in the long run, will work.