China's policy of non-interference in another country's internal affairs has served it well. It has been instrumental, for example, in securing resources deals with other nations that could have been derailed if it had taken an unwelcome interest in humanitarian issues. That is a delicate balancing act. North Korea pushed it beyond its limits by conducting a nuclear test in defiance of international opinion and warnings from Beijing. China's rare show of anger with its old friend and neighbour and support for UN sanctions was evidence of that. Non-interference does not extend to nuclear proliferation on China's doorstep by a secretive, economically dysfunctional dictatorship that has turned its back on international agreements. Thanks to some deft diplomacy backed up by pressure on Pyongyang, Beijing has emerged from this crisis smelling of roses. Within three weeks of the atomic explosion that shook the world, it has brokered meetings between United States and North Korean negotiators, and agreement from Pyongyang to return, without preconditions, to the six-nation nuclear disarmament talks. US President George W. Bush has thanked China for its mediation, and chief American negotiator Christopher Hill said close co-operation between the US and China had been a key factor. At least something good has come out of a serious threat to stability and peace. An improved diplomatic working relationship between Washington and Beijing can only make the world a better place. As Washington acknowledged with a slight but crucial relaxation of its inflexible approach to North Korea, China, as the North's economic lifeline, was in the best position to force Pyongyang back to talks. There is debate about how much significance to attach to statistics showing China sold no crude oil to North Korea in August. The apparent cut-off, after missile tests in July and before the nuclear test, is highly unusual. If repeated, it would cripple the North's economy. More co-operation between Washington and Beijing adds a new dimension to the negotiations that lie ahead. The talks have already dragged on for three years. Last September, they resulted in a framework agreement under which the North would abandon its nuclear weapons programme in exchange for a range of diplomatic, economic and energy incentives. But the North disavowed it, citing financial sanctions imposed by the US, and the talks collapsed. It may be a hopeful sign that North Korea reportedly insists that this agreement should be the main focus of the renewed talks. When the talks resume, Pyongyang may be expected to demand recognition as a nuclear power, and try to negotiate from a position of strength. The other five nations, which also include South Korea, Japan and Russia, must make it clear that this is out of the question. North Korea expelled International Atomic Energy Agency inspectors three years ago and withdrew from the Non-Proliferation Treaty. The least that should be expected now is that it agrees to scale down its nuclear activities and readmit inspectors. Given Pyongyang's record as an unreliable negotiating partner, the talks may be expected to run into deadlock sooner rather than later, perhaps on this issue. On the sidelines of the six-nation talks, the US has agreed to discuss its sanctions against North Korea's international banking operations, in particular the freeze on funds in Banco Delta Asia, the Macau-based bank accused of helping the North launder the proceeds of drug smuggling and other illicit activities, and to pass counterfeit US$100 bills printed by the Pyongyang government. The US may be expected to take a tough line. After all, state-sponsored undermining of another nation's currency with counterfeit notes is an uncommonly hostile act. Clearly, if North Korea is to be convinced that its negotiating partners are united and that disruption of the talks will only delay the lifting of UN sanctions, diplomatic co-operation between Washington and Beijing remains a key factor.