TESTIMONY
OF
GARY MILHOLLIN
DIRECTOR, WISCONSIN PROJECT ON NUCLEAR ARMS
CONTROL AND PROFESSOR EMERITUS, UNIVERSITY
OF WISCONSIN LAW SCHOOL
BEFORE THE
HOUSE
ARMED SERVICES COMMITTEE
UNITED STATES HOUSE OF REPRESENTATIVES
REGARDING
SEVEN STEPS TO OVERHAUL COUNTERPROLIFERATION
March
17, 2004
I am
pleased to appear today to discuss export
controls and their impact on the spread of
mass destruction weapons. Before getting
into the substance of my testimony, I would
like to offer a recent publication by my
organization for inclusion in the hearing
record. It is an article listing
transshipments of dangerous items through
Dubai in the United Arab Emirates. The
article appeared in the New York Times
on March 4, 2004.
The
committee has asked me to give a status
report on worldwide export controls and to
comment on the proposals that President Bush
made during his speech on February 11 at the
National Defense University. The committee
has also asked me to describe an effort that
my organization is making to improve export
controls in the countries of Eastern Europe
and the former Soviet Union.
One of
the best ways to appreciate the strengths
and weaknesses of today's export control
system is to consider the amazing nuclear
smuggling network that we have been reading
about in the newspapers. In his speech on
February 11, the president described what
one Pakistani scientist, plus a handful of
his henchmen, have been able to achieve
during the past decade. To Libya, Iran and
North Korea, they supplied components for
high-speed gas centrifuges, machines that
convert natural uranium to nuclear weapon
grade and are very hard to manufacture on
one's own. To Libya, they even sold the
design for an actual nuclear weapon – one
that is known to work. Iran and North Korea
also may have received the same bomb design;
we still don't know.
The most
important fact about this network is its
success. The failure of the United States
to detect or to close down this nuclear arms
bazaar must rank as one of the great
national security disasters of our time. It
allowed threats to develop that dwarf
anything Saddam Hussein was able to do after
the 1991 Gulf War. Three of America's most
resolute foes got much of what they needed
to make nuclear weapon material, and we
either didn't know about it or didn't do
anything sufficient to stop it. Two of
those foes, Iran and Libya, are long-time
supporters of terrorist organizations.
To make
matters worse, this nuclear spider's web was
not spun by some shadowy figure. It was set
up by the well-known Abdul Qadeer Khan, a
Pakistani scientist notorious since the
1970's as a nuclear smuggler. While
employed in the Netherlands, he stole the
designs for European centrifuges, brought
them home to Pakistan, and became the
"father" of the Pakistani bomb. Then,
traveling from his nuclear weapon laboratory
in Pakistan, he made dozens of trips to
Libya, Iran and North Korea to sell his
wares and keep his customers happy.
Iran was
outfitted in the late 1980's and early
1990's. North Korea got what it needed in
the mid and late 1990's. Libya was still
getting things last fall. Thousands of
centrifuge parts were sent to Libya from a
factory in Malaysia, and other parts and
machinery also came from Europe. We should
ask the question: What can we learn from
this frightening experience?
The
first lesson is that these smuggling
networks must be stopped before they
succeed. This one wasn't. It defeated our
export control system like the German army
defeated the Maginot line – by simply going
around it.
President Bush claimed in his speech that
the Khan network was "gradually uncovered"
over "several years" by U.S. and British
intelligence agents. But that seems to be a
great exaggeration. Pakistani President
Pervez Musharraf says that our government
didn't tell him about the network in any
detail until last October. When asked about
Musharraf's statement, U.S. officials have
not refuted it. They say only that
Musharraf was given more general warnings
earlier. As for North Korea, U.S. diplomats
only confronted Pyongyang over its
centrifuge imports in 2002, several years
after they happened. And Iran's centrifuge
factory didn't become a public issue until
it was publicized by the Iranian resistance
in August 2002. Concerning Libya, our
intelligence agencies take credit for the
seizure last October of centrifuge parts
bound for that country, but according to a
recent report in the New Yorker
magazine, it was the Libyans themselves who
revealed the shipment as part of their peace
offering to the West.
Even if
we look at these cases in the rosiest
possible light, the United States was about
a decade late in confronting the Pakistani
government; it was more than a decade late
responding to Iran's progress; it was tardy
by several years in the case of North
Korea. What this shows is that the United
States was essentially defenseless against a
burgeoning nuclear black market across the
span of three U.S. administrations.
The
question is: what was the U.S. government
doing all this time? Apparently, nothing
effective. I suggest that Congress could
provide a great public service by demanding
a clear explanation of why our government
failed for so long to stop this network.
The
second thing we should realize about this
network is that most of the persons and
countries that participated in it were
outside the worldwide system for controlling
exports. In fact, the network seems to have
been set up for the express purpose of
defeating export controls. The network was
overseen by a Pakistani; it was operated by
companies in Dubai in the United Arab
Emirates; it carried out manufacturing in
Malaysia. None of these countries takes
part in the existing regimes to control
nuclear exports.
Malaysia
and the Emirates do adhere to the Nuclear
Nonproliferation Treaty. But under that
treaty, it is legal for a member to ship
centrifuge parts to other treaty members
such as Libya or Iran without imposing any
restrictions. This is so because of the
assumption that any fissile material that
exists inside a treaty member's borders will
be inspected by the International Atomic
Energy Agency. Of course, both Libya and
Iran made fissile material with imported
equipment without telling the Agency. The
lack of control on exports among treaty
members is a large loophole that needs to be
closed.
The
third thing we should realize is that
persons and companies from countries inside
the worldwide export control system also
were involved. Germany and Switzerland are
both implicated. The authorities there are
no doubt looking into what their companies
did. In addition, it has just been revealed
that Japan sold Libya an entire uranium
conversion plant in the mid 1980's. Such a
plant is specifically designed to help its
user enrich uranium, which in Libya could
only have been intended for atomic bombs.
It is hard to understand how the Japanese
government could have allowed such a
reckless export to happen. These lapses
show that existing laws need to be more
vigorously enforced.
Despite
these setbacks, it is important to
understand that export controls still
perform a vital function. They slow down
countries that want to make mass destruction
weapons, they make their weapon programs
more expensive, and they give diplomacy time
to work. In effect, they force buyers to
use a smuggling network. And because things
like centrifuge components cannot be bought
openly from reputable suppliers, Iran has
taken more than a decade to develop its
existing centrifuge capability, which, as
far as we know, is based on old and less
efficient designs. Libya had made little
progress when it decided to give up its
program. It was entirely dependent on
continued help from outside. If these
countries could have purchased turn-key
centrifuge plants on the open market with
engineering support, their bomb programs
would probably have succeeded long ago. As
for North Korea, the status of its
centrifuges is still a mystery, like most
things about its nuclear programs.
The
committee has also asked me to comment on
the proposals in President Bush's speech.
Some of the proposals are aimed at
tightening the rules applied by the Nuclear
Suppliers Group, which now includes forty
countries. These suppliers could no longer
sell the means to make plutonium and
enriched uranium, the two nuclear weapon
fuels, to any country that was not already
capable of making these materials.
Unfortunately, this proposal is not too
clear. It does not seem to affect Israel,
India, Pakistan and North Korea – the newest
nuclear weapon builders – because they can
already make such bomb fuel. It might not
even affect Iran, which can already enrich
uranium. When we consider that Iraq and
Libya have now moved out of the bomb
business, it is hard to see who might be the
target of this proposal, other than perhaps
Syria. In addition, the proposal does not
apply to sellers in countries that do not
belong to the Nuclear Suppliers Group, such
as Malaysia, Pakistan and the U.A.E., not to
mention some 150 other non-participating
states.
The
president's plan also appears to prohibit
the nuclear suppliers from selling
nuclear-related exports to any country that
has not yet agreed to the "Additional
Protocol" sponsored by the International
Atomic Energy Agency. This is a good idea,
so long as many more countries, including
the United States, agree to the heightened
inspections that the protocol requires.
The
president further recommended that a new
committee be created at the International
Atomic Energy Agency, the purpose of which
would be to enforce the Agency's inspection
agreements. In addition, he recommended
excluding from this committee and from the
Agency's Board of Governors any state that
is under investigation for violating its
non-proliferation obligations. This latter
measure is aimed at Iran.
These
are all good proposals, but they don't go
far enough. They are not aimed at the main
target – which is the nuclear black market.
Tinkering with what law-abiding countries do
won't make much difference to rogue networks
like A. Q. Khan's. The only way to combat
these networks is to find out about them
early, and to shut them down before they
achieve their goals. So far, we have not
been able to do that.
The
president did recommend strengthening the
new Proliferation Security Initiative, which
is a positive development. But seizing a
cargo here and there is not going to be
enough to stop proliferation. We must see
to it that smugglers are deprived of their
legal havens. That means getting more
countries to adopt and enforce adequate
export controls. In neither Dubai, Pakistan
nor Malaysia is there any legal restriction
on selling centrifuge parts to Libya or
Iran. That is also true of many other
potential manufacturing sites in the world.
Unless we do something to remove the
possibility of using such sites as
smugglers' havens, we will continue to face
the danger of nuclear black markets.
One step
toward closing this loophole would be to get
all nations to adopt the export controls
that are contained in the "Additional
Protocol" mentioned above. These controls
provide that if a country exports, say,
centrifuge components, it must notify the
International Atomic Energy Agency that the
export is going out. It must also tell the
Agency where the export is going. The
importing country must then allow the Agency
to inspect the components.
Once the
United States ratifies the protocol, it
should try to get all countries to adopt
it. The United States could, for example,
introduce a U.N. Security Council resolution
requiring all nations to adopt at least the
export control provisions of the protocol.
Such a measure could be added to the
resolution to outlaw proliferation that the
White House is now drafting. Pakistan, the
United Arab Emirates and Malaysia would then
be under pressure to control what crosses
their borders.
A second
step would be for the United States to crack
down on retransfer points such as the
Emirates. President Bush has mentioned
interrogations in Pakistan and actions
against the factory in Malaysia, but has
given no indication that Dubai will suffer
any adverse consequences. We cannot worry
only about rogue regimes without also
shutting down the places that allow them to
buy what they want. We have to put pressure
on the countries that allow dangerous trade
to flourish, even if it means, in the case
of the Emirates, withholding aid and
refusing arms sales.
A third
way to strengthen export controls is to work
directly with other countries to help them
improve their performance. That is what my
organization has been doing for the past
four years. In January 2000 we started a
program to help the countries of Eastern
Europe and the former Soviet Union. Since
then we have visited eighteen of these
countries and trained more than 250
officials.
All of
these countries are trying to build
successful export controls over the remains
of the administrative systems they inherited
from their days in the East Bloc. Most of
them must contend with goods coming across
their borders from Russia or elsewhere that
are mislabeled. Whether we like it or not,
these countries are now the first line of
defense against arms proliferation. It is
their export control officers, customs
officials and border guards who must stop
dangerous exports before those exports
threaten us in our homes. In the most
literal sense, homeland security now begins
abroad.
To help
these officials do their jobs better, we are
supplying them with our database, which is
called the Risk Report, and showing
them how to use it. The database was
launched with support from private
foundations, and is now being sustained with
subscription revenues and support from the
Defense and State Departments.
The
Risk Report lists the names and
activities of over 3,700 entities around the
world that are linked to nuclear, chemical,
biological, and missile proliferation or to
terrorism. It also describes the sensitive
products that are controlled for export, and
has pictures of these products and explains
why they are controlled. The Risk Report
is now being used by some 30 countries, for
both export licensing and export
enforcement. We know that the information
in the database has been used to block
dangerous exports to both India and Iran.
In the years ahead, we hope to bring the
database to even more countries.
