Intelligence report claims nuclear market thriving

European firms warned they are main target of illicit trade in weapons parts

Ian Traynor and Ian Cobain
Wednesday January 4, 2006
The Guardian


It is intended as an alarm bell sounding in the boardrooms of western Europe's leading engineering companies as well as the common rooms of campuses and cutting-edge science labs.
It is also a wake-up call to EU governments, spy agencies and customs officials struggling to keep the ingredients for weapons of mass destruction (WMD) out of the hands of some of the most unsavoury regimes in the Middle East and the far east.

But if the 55-page confidential "early warning" intelligence assessment is impressive in the sheer mass of detail on the names and locations of suspect players in the global WMD game, the information may be seen as deeply troubling. It emphasises that west European engineering firms, germ laboratories, scientific thinktanks and university campuses are successfully preyed on by multitudes of middlemen, front companies, scholars with hidden agendas and bureaucrats working for the Iranian, Syrian or Pakistani regimes.
The report from a leading EU intelligence service obtained by the Guardian represent, it seems, the pooled knowledge of at least four major EU member-states on how countries such as Iran, Syria, and North Korea orchestrate a vast network of traders, phoney companies, state institutions and diplomatic missions internationally to procure the means to develop chemical, biological, nuclear and conventional weapons.

Given the hi-tech nature of the coveted parts and materials, the west European marketplace is the principal shopping mall, while Russia and the former Soviet Union are targeted for talented if impoverished brainpower. The Iranians, for example, are using middlemen in the neighbouring and post-Soviet countries of Azerbaijan and Armenia to tap the post-Soviet market, the document states.

Or the Pakistanis. The world's biggest clandestine nuclear proliferation racket, centred around the Pakistani metallurgist, Abdul Qadeer Khan, was exposed more than two years ago. Khan is under house arrest and several of his collaborators in Europe have been arrested in Germany, Switzerland and South Africa.

Yet the business rolls on, according to the document almost from the moment Khan went on Pakistani television to "confess" in February 2004. "Since the beginning of 2004 extensive procurement efforts for the Pakistani nuclear sector have been registered."

Furthermore, the range of materials and components being bought "clearly exceeds" that required for spare parts and replacements in Islamabad's nuclear programme. That suggests the nuclear black market is trading on the surplus goods.

The report notes, for example, that Khan's shopping sprees included high-grade aluminium tubing for the centrifuges that spin uranium into bomb fuel. He sold the pipes to Libya's Colonel Muammar Gadafy, who has since given them up. "The procurement efforts for such tubing were not halted after the uncovering of the procurement network."

Khan's power base outside Islamabad, the Khan Research Laboratories (named after him), remain a central institution in the Pakistani nuclear programme, according to the document, served by an array of front companies who are past masters at disguising the real "end users" for the components and equipment they purchase in western Europe.

While the Pakistani bomb project has long been realised, Iran's nuclear ambitions are not as advanced and have the makings of an international crisis. So it is not surprising that much of the document focuses on Iranian activities - not only in the nuclear field, but in bio-chemical and conventional weapons, notably its "very ambitious" missile programmes. The document lists more than 200 Iranian companies, institutes, government offices and academic outfits said to be engaged in weapons research, development and procurement, and mostly subordinate to the defence ministry in Tehran's armed forces logistics department.

Russia, which has just clinched a billion-dollar missile deal with Iran, is identified as crucial to Iran's military programmes, especially the missile development; 16 Russian companies and academic institutes are named as helping and profiting from the Iranian military effort. They range from the Glavkosmos space agency to St Petersburg's Technical University.

The Iranians, as well as the Pakistanis and the Syrians, are also benefiting from North Korean military prowess and exports, the document says, noting that "the export of arms equipment is currently reckoned to be North Korea's most important source of income."

To maintain this performance, the document says, the North Koreans increasingly depend on being able to import western goods and equipment. To this end they use a dense web of firms and offices, their roots going back to the 1970s.

More than 30 of the named companies and institutions said to be involved in the North Korean arms procurement endeavour are in China and most of those are Chinese state firms or bodies.

Last week the US State Department slapped sanctions on six Chinese companies for their alleged supplies to Iran's military industries.

The main market for the North Korean exports is the Middle East. "The most important buyers are Egypt, Iran, Pakistan and Syria."

Damascus, the document says, has been striving for self-sufficiency in its WMD efforts for years through substantial supplies of material and knowhow from Russia and through purchases in western Europe. Most surprisingly perhaps, the report says that Syria "has recently strengthened cooperation in the [arms] sector, particularly with Iran".

The 55 pages list hundreds of companies and institutions from Pyongyang to Beijing to Sofia said to be in the WMD business, often using front companies in Dubai to disguise their true dealings.

The aim is to "name and shame", to warn off EU companies from doing business with the listed organisations. What the intelligence assessment does not include are the names of the west European firms and scholars believed to be profiting handsomely from the trade in military knowhow and components.

http://www.guardian.co.uk/iran/story/0,12858,1677554,00.html