Understanding Nuclear Restraint: What Role Do Sanctions Play?

Neerada Jacob

2012

For my family

UNDERSTANDING NUCLEAR RESTRAINT: WHAT ROLE DO SANCTIONS PLAY?

A STUDY OF IRAQ, TAIWAN, LIBYA, AND IRAN

Neerada Jacob

ABSTRACT

The dissertation seeks to understand the role of sanctions in the scaling back of nuclear weapons programs. It analyzes the nuclear programs of four countries (Iraq, Taiwan, Libya, and

Iran) based on a classification of nuclear restraint as Slow, Stop, and Rollback. The research finds that sanctions have, at times, played a significant intermediary role in ending nuclear weapons programs. The central argument is that the impact of sanctions can be understood in terms of limiting resources, or by affecting the motives for the nuclear program. Such a categorization of the sanctions impact contributes to the literature by delineating two broad ways by which alone sanctions can change a country’s policy. The dissertation also contributes to the literature on nuclear proliferation by developing the concept of nuclear restraint in terms of three sub-categories (Slow, Stop, and Rollback).

ACKNOWLEDGMENTS

This dissertation owes much to the dedication of my committee members, Prof. Sharon

Weiner, Prof. Steve Silvia, and Prof. George Quester. All of them have had high enthusiasm for the project, and ample patience as I worked through various arguments. I am grateful for their examples as scholars and respectable human beings, examples that I hope I can emulate. Their commitment to their work, to their students, and to being good people is something we could have more of in academia. Their scholarship also displays a rare open-mindedness to understand the social world for what it is, rather than dividing it into separate subject areas.

I am particularly thankful to my Chair, Prof. Sharon K. Weiner, whose insightful comments are reflected throughout the dissertation. She has been a true mentor, reflecting a rare and rather impossible combination of being deeply critical while highly supportive. The dissertation is truly the better for her penetrating commentary. In particular, she often pushed me beyond my tendency to throw up my arms and say, “everything matters!”

Prof. Silvia also never shied away from criticizing my work, while at the same time being encouraging. His knowledge of the comparative politics literature has enriched my dissertation. I thank Prof. George Quester for his contribution to the field of international security and the chance to work with him. The long trips to the College Park campus of the University of

Maryland were more than worth it for the illuminating insights he generated.

I sincerely thank the individuals who kindly spent time with me discussing their experiences with nuclear programs in various countries. Needless to say, these interviews have been extremely valuable.

I would like to thank all those who have taught or mentored me in the past, and my friends and colleagues at various institutions in India and the United States. Perhaps unknown to them, they have shaped who I am both intellectually and as a person. Special thanks go to Dr. iii

Surjit Mansingh, whose support I have had on both continents, and to Dr. Phil Williams at the

University of Pittsburgh.

I am grateful for the funding support I have received from the School of International

Service, American University. I am also grateful to two key institutions that have supported my work – the United States Institute of Peace (USIP), and the Belfer Center for International

Studies. I thank Dr. Chantal de Oudraat and Dr. Elizabeth Cohl at USIP for their enthusiasm and support. For scholarly exchanges and insightful comments, I thank Dr. Martin Malin, Dr. Steven

Miller, and Dr. Matthew Bunn of the Belfer Center. Colleagues who enriched my experience at

Belfer as well as made various contributions to my thinking include Mahsa Rouhi and Sungyeol

Choi.

I thank my friends Yeonmin Choi, Yesim Sungu, Dylan Craig and other cohort-mates at

American University, and my friends from Jawaharlal Nehru University. You have truly enriched the dissertation experience.

Finally, my deepest gratitude goes to my family, who has encouraged me through this process. Despite the pressures of having a dissertating wife/mother/daughter/sister, they never let me extinguish my passion for understanding the puzzle of nuclear rollback. Thanks to all of you, my dissertation has been truly an enjoyable experience, as I kept asking, why? why?

TABLE OF CONTENTS

ABSTRACT ...... ii

ACKNOWLEDGMENTS ...... iii

LIST OF TABLES ...... 5

LIST OF ILLUSTRATIONS ...... 7

CHAPTER 1 INTRODUCTION ...... 8

Puzzle of Nuclear Restraint ...... 8 Economic Sanctions ...... 9 Central Argument...... 10 Contribution of the Dissertation...... 12 Dissertation Outline ...... 13

CHAPTER 2 LITERATURE REVIEW ...... 14

Nuclear Proliferation ...... 15

Resource Factors ...... 17 (II) Motivational Factors ...... 23 Conclusion: Literature on Nuclear Nonproliferation ...... 48

Economic Sanctions ...... 50

Definition of Sanctions ...... 51 “Success” and “Failure” with Sanctions ...... 53 Sanctions Literature ...... 55 Conclusion: Literature on Economic Sanctions ...... 92

Conclusion ...... 93

CHAPTER 3 RESEARCH DESIGN ...... 95

Research Question ...... 95

Hypothesis...... 99

Method: Structured, Focused Comparison of Cases ...... 100 Case Selection ...... 101 Case Analysis ...... 107

Process Tracing ...... 107 Counterfactual Analysis ...... 108

Sources ...... 110 1

CHAPTER 4 IRAQ...... 111

The Nuclear Program ...... 112

Weapons Program ...... 118

Restraint I (Slow) 1979-1981...... 123

Restraint I: Motivational or Resource Driven? ...... 126 Sanctions and Restraint 1 ...... 129

Nuclear Pursuit 1982-1990 ...... 136

Sanctions and Pursuit 1982-1990...... 138

Restraint in the 1990s...... 140

Continued Nuclear Pursuit August 1990-January 1991...... 143

Restraint 2 (Rollback) January-February 1991 ...... 145

Restraint 2: Motivational or Resource Driven? ...... 147 Sanctions and Restraint 2 ...... 147

Restraint 3 – (Slow and Stop) March-April 1991 ...... 151

Restraint 3: Motivational or Resource Driven? ...... 153 Sanctions and Restraint 3 ...... 156

Restraint 4 – (Rollback) May 1991-1998 ...... 165

Restraint 4: Motivational or Resource Driven? ...... 168 Sanctions and Restraint 4 ...... 173

Continued Nuclear Restraint 1999-2003 ...... 184

(a) Resource Constraints 1999-2003 ...... 185 (b) Motivational Changes 1999-2003 ...... 189 Conclusion: Sanctions and Continued Nuclear Restraint 1999-2003 ..... 194

Conclusion ...... 194

CHAPTER 5 TAIWAN ...... 198

History...... 198 The Nuclear Program ...... 200

Weapons Program ...... 206 Safeguards ...... 210

Sanctions ...... 212 Restraint 1 – (Slow) 1973 ...... 214

Restraint 1: Motivational or Resource Driven? ...... 219 Sanctions possibly affecting Restraint 1 ...... 220 Sanctions and Restraint 1 ...... 221

Restraint 2 – (Stop and Rollback) 1977-1978...... 226

Restraint 2: Motivational or Resource Driven? ...... 239 Sanctions possibly affecting Restraint 2 ...... 241 Sanctions and Restraint 2 ...... 243

Restraint 3 – (Rollback) 1988 ...... 261

Restraint 3: Motivational or Resource Driven? ...... 263 Sanctions and Restraint 3 ...... 263

Continued Restraint 1988-2010 ...... 270 Conclusion ...... 271

CHAPTER 6 LIBYA ...... 273

History...... 274 Nuclear Program ...... 275

Weapons Program ...... 281

Nuclear Pursuit (1) 1970- mid 1980s ...... 295

Sanctions possibly affecting Pursuit 1 ...... 296 Sanctions and Pursuit (1) ...... 297

Restraint 1 – (Slow) mid 1980s- 1995 ...... 302

Restraint 1: Motivational or Resource Driven? ...... 303 Sanctions possibly affecting Restraint 1 ...... 307 Sanctions and Restraint 1 ...... 309

Nuclear Pursuit (2) 1995-2002...... 329

Sanctions during Pursuit (2)...... 330

Restraint 2 – (Slow and Rollback) 2002-09 ...... 338

Sanctions possibly affecting Restraint 2 ...... 340 Restraint 2: Motivational or Resource Driven? ...... 341 Sanctions and Restraint 2 ...... 343 The 2003 Decision ...... 357 3

Conclusion ...... 360

CHAPTER 7 IRAN...... 363

The Nuclear Program ...... 364 Restraint 1 (Stop) 1979-1983 ...... 381

Restraint 1: Motivational or Resource Driven? ...... 382 Sanctions possibly affecting Restraint 1 ...... 383 Sanctions and Restraint 1 ...... 385

Pursuit 1984-2002 ...... 394

Sanctions possibly affecting Pursuit ...... 395

Restraint 2 (Slow) 2003-05 ...... 412

Restraint 2: Motivational or Resource Driven? ...... 414 Sanctions possibly affecting Restraint 2 ...... 415

Pursuit 2006-2010 ...... 443

Resource Constraints and Motivational Factors in Pursuit 2006-10 ...... 445 Sanctions possibly affecting Pursuit 2006-2010 ...... 449 (a) Resource Constraints in Pursuit 2006-2010 ...... 452 (b) Motivational Changes in Pursuit 2006-2010 ...... 456

Conclusion ...... 465

CHAPTER 8 CONCLUSION...... 467

Conclusions ...... 467 The Mechanisms by which Sanctions Work ...... 476

(a) Resource Denial...... 476 (b) Motivational Changes ...... 480

Summary Conclusions ...... 487 Contributions to the Conventional Wisdom ...... 488

LIST OF TABLES

Table

Table 2.1 Varying hypotheses on characteristics of sanctions ...... 79

Table 2.2 Varying hypotheses on characteristics of the sender ...... 83

Table 2.3 Varying hypotheses on characteristics of the target ...... 84

Table 3.1 Three types of nuclear restraint ...... 97

Table 3.2 Cases of nuclear restraint ...... 101

Table 3.3 Cases of nuclear rollback ...... 103

Table 4.1 Iraq’s nuclear program ...... 123

Table 4. 3 Nuclear facilities destroyed in Desert Storm ...... 146

Table 4.4 Summary of Iraq’s nuclear restraint (rollback) Jan-Feb 1991 ...... 151

Table 4.5 Summary of Iraq’s nuclear restraint (slow and stop) March-April 1991 ...... 165

Table 4. 6 Key aspects of nuclear rollback by inspections, 1991-1994 ...... 167

Table 4.6 Summary of Iraq’s nuclear restraint (rollback) May 1991-1998 ...... 183

Table 4. 7 Summary of Iraq’s continued nuclear restraint 1998-2003...... 194

Table 4.8 Final summary of Iraq’s nuclear restraint ...... 194

Table 5. 1 Taiwan’s nuclear program...... 200

Table 5. 2. US sanctions on Taiwan ...... 213

Table 5. 3 US sanctions on Taiwan 1973 ...... 220

Table 5.4 Summary of Taiwan’s restraint 1 (slow) 1973 ...... 226

Table 5.5 Elements of restraint 2 (1977-78) ...... 227

Table 5. 6 Restraint 2 (1977-78) ...... 237

Table 5. 7. US sanctions on Taiwan 1976-1978 ...... 242

Table 5.8 Summary of Taiwan’s restraint 2 (rollback) 1977-78 ...... 261

Table 5.9 Summary of Taiwan’s restraint 3 (Rollback) 1988 ...... 269

Table 5.10 Taiwan’s nuclear rollback ...... 272

Table 6.1 Libya’s nuclear program ...... 276

Table 6.2 Details of Libya’s nuclear weapons program ...... 291

Table 6.3 Libya’s Restraint 2 (slow and rollback) 2002-09 ...... 295

Table 6.4 US Sanctions against Libya during Pursuit (1) ...... 296

Table 6.5 Summary of Libya’s Restraint 1 (slow) 1988 ...... 328

Table 6.6 Summary of Libya’s Restraint 2 (slow and rollback) 2002-2009 ...... 360

Table 6.7 Final summary of Libya’s nuclear restraint ...... 362

Table 7.1 Iran’s Nuclear Program ...... 365

Table 7.2 Summary of Iran’s Restraint 1 (stop) 1979-1983 ...... 393

Table 7.3 US Sanctions on Iran during Pursuit 1984-2002...... 398

Table 7.4 Summary of Iran’s Restraint 2 (slow) 2003-2005 ...... 443

Table 7.5 Iran’s centrifuge enrichment program since 2006 ...... 445

Table 7.6 Final summary of Iran’s nuclear restraint ...... 466

Table 8.1 Summary of rollback in Iraq, Taiwan, and Libya ...... 468

Table 8.2 Final summary of the impact of sanctions on nuclear restraint ...... 469

LIST OF ILLUSTRATIONS

Illustration

Figure 4. 1 Iraq’s GDP 1970-1982 ...... 134

Figure 4. 2 Iraq’s oil production and exports 1970-1982 ...... 134

Figure 4.3 Iraq’s falling GDP in the 1990s ...... 176

Figure 4.4 Iraq’s GDP growth rates in the 1990s ...... 177

Figure 4.5 Iraq’s GDP 1998-2003 ...... 188

Figure 5. 1. Taiwan’s export growth ...... 248

Figure 5. 2 Taiwan’s major trade partiners, 1975 ...... 249

Figure 5.3 Taiwan’s major export partners, 1985 ...... 268

Figure 5. 4 Taiwan’s trade balance with the US ...... 269

Figure 6.1 Libya’s GDP during Pursuit (1) ...... 300

Figure 6.2 Libya’s GDP and Oil Revenues in Restraint 1 ...... 313

Figure 6.3 Libya’s Oil Revenues in Pursuit (2) ...... 335

Figure 7.1 Iran’s Economic Trends in Restraint 1 ...... 387

Figure 7.2 Iran’s Oil Exports in Restraint 1 ...... 389

Figure 7.3 Iran’s GDP Growth Rates in Pursuit 1984-2003 ...... 406

Figure 7.4 Iran’s Oil Exports in Restraint 2 ...... 426

Figure 7.5 Iran’s GDP prior to Restraint 2 ...... 427

Figure 7.6 Trade as a Proportion of Iran’s GDP ...... 428

Figure 7.7 Iran’s Improving Oil Income ...... 439

Figure 7.8 Iran’s Oil Income in the 2000s ...... 455

Figure 7.9 Iran’s Growth Rates, 2004-2010 ...... 456

CHAPTER 1

INTRODUCTION

In an age where the proliferation of nuclear weapons is considered a central security problem, nations seem to have few means by which to prevent proliferation. In the spectrum of policy choices ranging from diplomacy to military force, economic sanctions appear to offer an attractive balance of limiting proliferation with minimal costs. Have sanctions, in fact, helped restrain nuclear weapons programs? This dissertation asks this question, offering a detailed analysis of four nuclear programs – Iraq, Taiwan, Libya, and Iran.

In this introductory chapter, I first lay out the puzzle of nuclear restraint and its significance.

Next, I point out the importance of sanctions as a potential instrument to limit proliferation. I show that we have limited knowledge on the role of sanctions in nuclear restraint. I then summarize the argument of the dissertation, which is that sanctions contribute to nuclear restraint through two analytically distinct processes, by limiting the resources for the program or by changing leaders’ motives for the program.

Puzzle of Nuclear Restraint

The research is centered on the concept of “nuclear restraint”, which is the scaling back of a nuclear weapons program. I define this concept as the slowing, stopping, or rolling back of a nuclear weapons program after embarking on it. Nuclear restraint forms a key puzzle for two reasons. First, government policy is usually accompanied by inertia – a resistance to reverse existing policy. This should generally make it harder to reverse an existing program than to abandon what has not been started. Once a program is begun, it is relatively easier for a government to keep it rolling than to fight policy inertia to end it. Hence the mere absence of the original causes of proliferation is insufficient to explain restraint. Second, a nuclear weapons 8

program can be originally instituted for certain purposes and later acquire different justifications, making it difficult to terminate.1 Restraint thus appears counterintuitive both against the perspective of governmental inertia and vis-à-vis the possibility of finding new rationales for the program.2

The question of why nuclear weapons programs are restrained is more complicated than the question as to why they are begun in the first place. This is because it encompasses the latter question, and because inertia suggests that the costs of reversing a nuclear program would be higher than the costs of starting one. It has been argued that the decision to “go nuclear” is an

“extraordinary step” involving an “extraordinary effort of will”.3 The reversal of such a powerful decision then, must involve as much resolve, if not more.

Economic Sanctions

The research is concerned with the policy tool of economic sanctions,4 which although they are widely used, are also commonly criticized as ineffective.5 I examine the role of sanctions in nuclear restraint for two reasons. First, sanctions remain attractive tools of foreign policy by

1 Michael J. Mazarr, North Korea and the Bomb: A Case Study in Nonproliferation (New York: St. Martin’s Press, 1995), 183. As Mazarr says, “Once a nuclear program becomes established, it will act as magnet for new justifications and motives.” He argues that the North Korean program was originally set up for security reasons, but later became an invaluable tool for diplomacy with the United States.

2 The central aspect of the puzzle is on the stopping or dismantling of a nuclear weapons program, rather than its mere slowing. These terms are defined in greater detail in the chapter on research design (Chapter 3).

3 Jacques E. C. Hymans, The Psychology of Nuclear Proliferation: Identity, Emotions, and Foreign Policy (Cambridge University Press, 2006), 12.

4 Sanctions refer to the (threat or actual) denial of normal economic relations for the purpose of achieving a political change. The term is defined in the next chapter (Chapter 2).

5 David Baldwin, Economic Statecraft (Princeton: Princeton University Press 1985), 57; James Barber, “Economic Sanctions as a Policy Instrument”, International Affairs, 55 No. 3 (1979), 373. As David Baldwin stated twenty years ago, “It would be difficult to find any proposition in the international relations literature more widely accepted than those belittling the utility of economic techniques of statecraft.” Similarly, James Barber wrote, “…there is a striking consensus in the literature that economic sanctions alone have been ineffective in the fulfillment of their primary objectives.” 9

virtue of their intermediary position between diplomacy and military force. Military force, if successful in curbing proliferation, almost invariably entails significant losses; diplomacy, although cheap, is largely unsuccessful in restraining a nuclear program.

Second, decision-makers continue to tout economic sanctions as a desirable response to the problem of proliferation. The furor over sanctioning Iran and North Korea, and the international cooperation actively sought for these efforts suggest that leading senders are actively engaged and significantly vested in attempting nuclear restraint in the targeted countries. Although such efforts may indeed be motivated by the desire to placate domestic audiences as some of the literature argues, it would be simplistic to conclude that policymakers held no expectations of sanctions effectiveness in slowing target nuclear programs. This policy instrument has been widely used and is increasingly being seen as the best option for countering proliferation without going to war. We must therefore develop a fuller understanding of whether sanctions restrain nuclear weapons programs.

Central Argument

This research finds that sanctions can bring about nuclear restraint by limiting the resources available for the nuclear program (“resource denial”), and/or by changing the motives driving the program (“motivational changes”). In the former, a state does not choose to limit its nuclear program, but is simply unable to access the appropriate technical or financial resources required for nuclear pursuit. By contrast, the motivational route entails a change in the cost-benefit calculus favoring nuclear restraint. The distinction between resource denial and motivational change is derived from Thomas Schelling’s work differentiating ‘brute force’ from

coercion.6 Whereas brute force affects the adversary’s capabilities, coercion is based on altering its motives. Hence coercion can be achieved only by affecting what the target values.7

Although the two concepts are analytically distinct, this dissertation highlights instances where resources constraints often factor into the motives for nuclear programs. For example, resource denial, by itself, was not a significant cause of restraint in any of the four countries studied here. However, resource denial did contribute to motivation-induced restraint in Taiwan and Libya; it was also important in preventing the rebuilding of Iraq’s nuclear program.

Regarding motivational changes, the research shows that sanctions were influential in changing the cost-benefit calculus in favor nuclear restraint in the cases of Taiwan, Libya, and Iran (2003-

2005). With Taiwan, the threat of US sanctions served to underline the danger of losing

American military and political support; in Libya and Iran, sanctions signaled the threat of military attack. However in Iraq, sanctions did not significantly decrease motivations for nuclear weapons.

To analyze the sanctions impact on motives, the dissertation employs Scott Sagan’s classic distinction of three sets of factors or ‘models’ affecting nuclear weapons programs – security, domestic politics, and norms.8 Extending Sagan’s analysis to study the impact of sanctions, this implies that sanctions can persuade leaders to undertake nuclear restraint through any of the following processes: (i) by signaling that security considerations require restraint, (ii) by having domestic political implications (such as strengthening domestic actors who favor restraint), or

6 Thomas C. Schelling, Arms and Influence, New ed. (New Haven: Yale University Press, 2008).

7 Schelling, Arms and Influence, New ed., 2-3.

8 Scott D. Sagan, “Why Do States Build Nuclear Weapons?: Three Models in Search of a Bomb”, International Security, 21 No. 3 (1996/97).

(iii) by persuading that national prestige will increase with restraint. Applying this framework to

Iraq, Taiwan, Libya, and Iran yields interesting insights.

The dissertation finds that the motivational route to nuclear restraint has occurred through the security or domestic politics models. Considerations of international prestige and norms have largely not been decisive in persuading restraint. Interestingly, the security implications of restraint appear to have been readily apparent to leaders in Taiwan, Libya, and Iran. In other words, all the instances of motivation-driven restraint entailed some security considerations. The research puts forward a new argument by showing that sanctions acted as a signal of military threats in Libya and Iran.

Another noteworthy observation is that restraint in Iraq, Taiwan, and Libya was significantly affected by concerns for domestic political survival or legitimacy. Taiwanese and Libyan leaders were motivated to nuclear restraint by concerns about regime continuity. Domestic concerns also motivated the Iraqi leader to conserve scarce resources; however, they did not convince him to give up nuclear weapons ambitions. Despite this qualification, the research has highlighted the domestic political pressures facing autocratic regimes.

Contribution of the Dissertation

The central contribution of this research is in pointing out resource denial and motivational changes as two distinct ways in which sanctions can bring about nuclear restraint. This is important since both the proliferation and sanctions literature have largely tended to focus on the latter. The case studies show that the dynamic between these two processes is not straightforward – at times, active resource denial made no dent in regime motives for nuclear weapons (Iraq in the 1990s) or actually increased them (Iran 1990s).

The dissertation advances current knowledge on the sanctions impact on nuclear restraint, in significant part due to the dearth of existing work on the subject. It brings together insights from the two largely separate bodies of work on proliferation and sanctions respectively. Due to the broad consensus that sanctions are weak instruments, the literature does not expect them to be successful in issues of “high politics”9 such as nuclear proliferation.

Dissertation Outline

The next chapter (Chapter 2) reviews the current knowledge on proliferation and that on sanctions. It is shown that, until recently, the former has tended to treat cases of nuclear restraint as anomalous. The sanctions literature has also largely tended to dwell on their ineffectiveness.

In Chapter 3, I present the research design based on the case-study approach. This chapter defines key terms and offers a broad view of the universe of nuclear restraint. The next four chapters (4 to 7) discuss each of the four countries and their nuclear programs – Iraq, Taiwan,

Libya, and Iran. Finally, Chapter 8 presents the major conclusions of the research.

9 Baldwin, Economic Statecraft, 116; M. S. Daoudi and M. S. Dajani, Economic Sanctions: Ideals and Experience (Boston: Routledge and Kegan Paul, 1983); George A. Lopez and David Cortright, “Economic Sanctions in Contemporary Global Relations” in Economic Sanctions: Panacea or Peacebuilding in a Post-Cold War World? eds. David Cortright and George A. Lopez (Boulder: Westview Press, 1995), 8.

CHAPTER 2

LITERATURE REVIEW

This chapter reviews existing arguments related to the question of whether economic sanctions contribute to nuclear restraint. The two relevant bodies of literature are studies on nuclear proliferation, and those discussing the working of economic sanctions. The sanctions literature involves numerous publications, but is typically separated entirely from the literature on nuclear restraint i.e. works on sanctions do not ask if economic sanctions affect nuclear programs, while those on nuclear proliferation generally do not study if and how sanctions may cause nuclear restraint.

The chapter examines the main explanations for nuclear proliferation, classified broadly as the “technological thesis” and motivational factors, which are themselves divided into security, domestic politics, and norms. Nuclear restraint is often understood as being caused by changes in the original drivers of proliferation. In other words, restraint may be brought about by technological/ economic inability, decreases in security threats, changes in domestic politics, or the nonproliferation norm. The bulk of the proliferation literature focuses on the motivational factors. Existing work also presents three specific arguments for nuclear restraint and these are discussed in detail separately.

On economic sanctions, the chapter offers a brief view of the abundant literature largely discussing the failure of sanctions, along with the few studies arguing that sanctions can be effective. Most of the large body of work on sanctions analyzes their effect on policy goals such as upholding human rights, ending terrorism, or weakening dictatorships. Because the sanctions literature largely does not specifically address the objective of nonproliferation, the implications

of its insights must be extrapolated for the purposes of this dissertation.1 One recent full-length published work examining the sanctions impact on nuclear proliferation is discussed here.2

Nuclear Proliferation

In the dissertation, nuclear restraint is understood as the slowing, stopping, or rolling back of a nuclear weapons program. The focus is on explaining the stopping and rolling back of weapons efforts as they form an important puzzle. Existing work on this specific topic is limited to three important scholars,3 while a fourth considers the related issue as to whether nuclear restraint is itself likely to be reversed.4 These explanations and their shortcomings are discussed below. Such arguments are classified according to Scott Sagan’s seminal article describing three models of the various demands for nuclear weapons.5

Scott Sagan offers a comprehensive framework encompassing a range of the possible factors affecting states’ desire for nuclear weapons.6 He combined the insights of existing works since the 1970s into a three-fold classification of the motives for nuclear proliferation and extended them to explain nuclear proliferation and restraint, presenting a valuable analytical

1 There is no a priori reason to expect that sanctions will work differently for the nonproliferation goal.

2 Etel Solingen, ed., Sanctions, Statecraft, and Nuclear Proliferation (Cambridge University Press, 2012). It remains the sole full-length volume dedicated to understanding the role of sanctions in nuclear restraint.

3 T. V. Paul, Power Versus Prudence: Why nations Forego Nuclear Weapons (Montreal: McGill-Queen’s University Press, 2000); Mitchell Reiss, Without the Bomb: The Politics of Nuclear Nonproliferation (New York: Columbia University Press, 1988); Mitchell Reiss, Bridled Ambition: Why Countries Constrain Their Nuclear Capabilities (Washington, D. C.: Woodrow Wilson Center Press, 1995); Etel Solingen, “The Political Economy of Nuclear Restraint”, International Security, 19 No. 2 (1994); Etel Solingen, Nuclear Logics: Contrasting Paths in East Asia and the Middle East (Princeton: Princeton University Press, 2007).

4 Kurt M. Campbell, Robert J. Einhorn, and Mitchell B. Reiss, The Nuclear Tipping Point: Why States Reconsider their Nuclear Choices (Washington, D. C.: Brookings Institution Press, 2004).

5 Sagan, “Why Do States Build Nuclear Weapons?”

6 Itty Abraham, “The Ambivalence of Nuclear Histories”, Osiris, 21 (2006, 50); Ariel Levite, “Never Say Never Again: Nuclear Restraint Revisited”, International Security, 27 No. 3 (2002/03). Itty Abraham writes: “Political scientist Scott Sagan offers us the most comprehensive statement on why states “go” nuclear” (emphasis mine). 15

frame of possible explanations. The security model views both proliferation and nuclear restraint as being driven by calculations pertaining to a country’s security threats. Thus high insecurities may lead a state to develop nuclear weapons, while perceived insecurities or threat decreases could lead to restraint. According to the domestic politics model, the quest for nuclear weapons is the result of bureaucratic and political pulls within the domestic governance of a state. Vested interests such as the military-industrial complex may push for nuclear weapons, while the dominance of particular politicians or parties with anti-nuclear stances may lead to restraint.

Finally, the third category constitutes factors relating to status and prestige considerations -- the norms model holds that a country may be motivated to acquire nuclear weapons due to the perceived high international status attached to nuclear weapons possession, or it may reverse its pursuit of nuclear weapons due to the emerging nonproliferation norm which isolates and discredits proliferants.

Although Sagan does not state this, the three models draw separately on three important theoretical traditions in International Relations – Realism, Liberalism, and Constructivism respectively. The security model follows the general assumptions and predictions of Realism and its variants; following Liberalism, the domestic politics model emphasizes the competition for influence among different domestic groups; and the norms model highlights the importance of ideas, beliefs, and perceptions along the lines of Constructivism. Broadly speaking then, the diverse motivational causes of nonproliferation can be classified along this framework of

Realist-security oriented factors, bureaucratic/organizational and Liberal causes, and norm- based Constructivist aspects. There is some overlap between these categories and in the discussion below, the liberal emphasis on the role of institutions is dealt with under the normative framework as it is very closely tied to arguments about the nonproliferation norm.

Sagan’s work remains the cornerstone in explanations of both proliferation and nonproliferation. It remains the central rubric for understanding nuclear restraint – it suggests that restraint is driven by changes in the original motives for proliferation, a point made by other authors.7 It also highlights the fact that there could be multiple explanations for both proliferation and nonproliferation, so that the ultimate status of a country is the result of a combination of elements in all three models.

Sagan’s models helpfully classify the motivational or demand-side of proliferation (i.e. why states want nuclear weapons) into three categories. The resource factor or supply-side highlights that nuclear proliferation cannot take place without the necessary technical and financial resources. Hence nuclear restraint could be caused by insufficient technological or economic capability. Thus the two broad categories of explanations for nuclear restraint lie in resource factors (technical and financial capability) and motivational elements (why states desire nuclear weapons). These are discussed in detail below.

Resource Factors

A country may slow down its pursuit of nuclear weapons if it becomes unable to continue with the massive technological/ scientific requirements or due to the economic burden of a weapons program. This explanation of restraint emphasizes supply-side factors highlighting the physical availability of the means and the economic capacity to build the weapon. The technical resources needed to develop nuclear weapons include scientific knowledge, the engineering technology of nuclear weapons, industrial production capacity, and physical resources such as

7 Paul, Power Versus Prudence; Harald Müller and Andreas Schmidt, “The Little-Known Story of Deproliferation: Why States Give Up Nuclear Weapons Activities” in Forecasting Nuclear Proliferation in the 21st Century: The Role of Theory, ed., William C. Potter with Gaukhar Mukhatzhanova (Stanford University Press, 2010), Volume 1, 129-130.

raw materials.8 Once these are available, a country with an industrial base of the United States in 1941 can produce nuclear weapons in about four years with steady work and massive investment.9 Developing countries tend to lack some of these requirements or possess them in limited amounts, so that they are generally not expected to produce nuclear weapons unless they receive assistance from industrialized countries.10 For example, Stephen Meyer refers to the

“Sears, Roebuck factor,” which is the ability to replace broken or missing parts; and the “yellow pages” factor is the ability to easily identify electricians, plumbers, etc. for repairs and maintenance. Meyer argues that such factors tend to be overlooked when determining countries’ technological capabilities and can be crucial in affecting their ability to develop nuclear weapons.11 He believes that the lack of technological capacity explains why most countries did not seek nuclear weapons until the start of the Atoms for Peace program in 1956.12

The science of nuclear weapons is widely known today and is no longer a mystery or a technological impossibility. A country can simply follow well-established paths to nuclear weapons, particularly since knowledge of uranium enrichment methods is widespread.13 It was therefore believed that the main technical barriers today pertain more to obtaining the physical means rather than the knowledge -- acquiring sufficient quantities of plutonium or enriched uranium i.e. fissile material, affording the cost of obtaining special materials, and fabricating

8 Stephen M. Meyer, The Dynamics of Nuclear Proliferation (Chicago: University of Chicago Press, 1984).

9 Peter D. Zimmerman, “Technical Barriers to Nuclear Proliferation”, Security Studies, 2 No. 3-4 (1993).

10 Leonard Beaton and John Maddox, The Spread of Nuclear Weapons (New York: Frederick A. Praeger, 1962); Robert F. Mozley, The Politics and Technology of Nuclear Proliferation (Seattle: University of Washington Press, 1998).

11 Meyer, Dynamics of Nuclear Proliferation, 32-36.

12 Meyer, Dynamics of Nuclear Proliferation, 77-90.

13 Zimmerman, “Technical Barriers to Nuclear Proliferation”.

nuclear components of the weapon.14 The most formidable of these is access to fissile material.15 However, recent experience with the Libyan nuclear rollback suggests that establishing such a knowledge base can be difficult for a developing economy.

In contrast to the early nuclear era, weapons-testing is no longer necessary,16 and most developing countries with modest technological bases have the technical capacity to fabricate nuclear components.17 The argument that technical capability was the main factor affecting the likelihood of proliferation has been called the “technological imperative” thesis. One version of this argument held that even if countries possess limited indigenous capability, they can develop nuclear weapons by acquiring technology from the widely expanding global nuclear industry:

The availability of nuclear technology means that the indigenous capabilities are no longer immutable restraints which prevent some nations from going nuclear; instead, low levels of scientific, technological, and economic capability have become factors which can be overcome through international commerce.18

In his thorough study, Stephen Meyer debunked the technological thesis by showing that most states with the technical capacity to develop nuclear weapons did not do so.19 Meyer’s

14 Zimmerman, “Technical Barriers to Nuclear Proliferation”.

15 Richard Kokoski, Technology and the Proliferation of Nuclear Weapons (Oxford University Press, 1995).

16 Meyer, Dynamics of Nuclear Proliferation.

17 Zimmerman, “Technical Barriers to Nuclear Proliferation”.

18 Charles W. Kegley, Jr., Gregory A. Raymond, and Richard A. Skinner, “A Comparative Analysis of Nuclear Armament” in Threats, Weapons, and Foreign Policy, ed., Pat McGowan and Charles W. Kegley Jr. (Beverly Hills: Sage Publications, 1980), 248.

19 Meyer, Dynamics of Nuclear Proliferation.

work has been called “groundbreaking” for empirically testing the technological imperative thesis.20

A milder, more recent version of the technological thesis is that the availability of nuclear technology facilitates the move toward nuclear weapons capability. Braun and Chyba argue that a new set of exporters of nuclear technology have emerged, leading to “second-tier proliferation”.21 These second-tier suppliers are developing countries, and they form networks for trading nuclear know-how called “proliferation rings”. According to Braun and Chyba, important members of such rings are Pakistan and North Korea, and A. Q. Khan was at the center of the proliferation ring exporting centrifuge technology to North Korea, Libya, and possibly Iran, Iraq, and Syria. Graham Allison refers to the real possibility that North Korea may act as a “nuclear Home Depot” in spreading nuclear technology to “rogue states” and terrorists.22 However, Alexander Montgomery is skeptical of such analyses stressing greater dangers from second-tier proliferation, arguing that most states are not “dead set” on proliferating.23 He advocates a pragmatic perspective holding that proliferation networks are in fact highly centralized and less effective than commonly thought, and that potential proliferators can be persuaded to reverse their efforts based on appropriate incentives.

Despite his cautionary stance on the likely extent of proliferation, Montgomery does acknowledge that proliferation networks make it easier and faster to acquire nuclear weapons.

20 Jacques E. C. Hymans, “The Study of Nuclear Proliferation and Nonproliferation: Toward a New Consensus?” in Potter, Forecasting Nuclear Proliferation, 19.

21 Chaim Braun and Christopher F. Chyba, “Proliferation Rings: New Challenges to the Nuclear Nonproliferation Regime”, International Security, 29 No. 2 (2004).

22 Graham T. Allison, “Global Challenges to Nuclear Proliferation”, in Nuclear Proliferation: Risk and Responsibility, eds., Graham Allison et al (Trilateral Commission, 2006).

23 Alexander H. Montgomery, “Ringing in Proliferation: How to Dismantle an Atomic Bomb Network”, International Security, 30 No. 2 (2005), 153-187.

The literature on nuclear technology generally concurs on this point, maintaining that lack of access to technology can be overcome and is not likely to be a major constraint on proliferation.

It appears that a determined proliferator could find ways of overcoming this problem. The overall consensus is that although technology may not cause proliferation by itself, it is nevertheless necessary for it.24 Thus nuclear technology is considered to be necessary but not sufficient for nuclear weapons programs. However, it is not necessary if the country succeeds in stealing or buying a nuclear device.

Matthew Fuhrmann offers a nuanced argument on the interplay between technological capability and security threats.25 He maintains that countries receiving peaceful nuclear cooperation “are especially likely to initiate bomb programs when threats arise…”26 This is because the technical capability generated by external assistance lowers the threshold of costs for nuclearization.

Apart from technical ability, nuclear weapons programs also require economic sustainability of the project. A state cannot produce nuclear weapons without making the necessary investments, purchases and expenditure. It must therefore be able to continue considerable expenses; nuclear weapons programs have involved substantial costs in part because of the ever-increasing quest for bigger arsenals and delivery systems. In the early

1980s, nuclear power programs had declined with few new orders for plants27 partly due to

24 Harald Müller, ed., A European Nonproliferation Policy: Prospects and Problems, (Oxford: Clarendon Press, 1987); William C. Potter, Nuclear Power and Nonproliferation: An Interdisciplinary Perspective (Cambridge: Oelgeschlager, Gunn & Hain, Publishers, 1982).

25 Matthew Fuhrmann, “Spreading Temptation: Proliferation and Peaceful Nuclear Cooperation Agreements”, International Security, 34 No. 1 (2009).

26 Fuhrmann, “Spreading Temptation”, 14.

27 Potter, Nuclear Power and Nonproliferation.

rising overheads. Although some authors hold that costs were important in limiting proliferation among less developed countries, others believe that the global trend to economic growth is likely to result in several countries becoming capable of pursuing nuclear weapons without crippling their economies.28 Stanley Erickson also argues that the expenses of nuclear weapons production have declined over time due to new technologies like the centrifuge method.29

Similarly, Brito and Intriligator maintain that declining costs and the availability of technology will greatly facilitate proliferation in the future.30

As Erwin Häckel notes, arguments about the economics of nuclear weapons have been made in both directions, with some holding that they provide defense cheaply and others believing they are too costly. Ultimately however, such economic arguments are overwhelmed by the weight of more pressing political, strategic, or moral positions. This means that the economic element remains as “inconclusive” as the logic of security.31 Technological and economic difficulties could well lead to nuclear restraint.

At the end of the day, however, it is unclear when national leaders decide to “give up” on nuclear pursuit or whether they choose to pursue the weapons at all costs. In other words, nuclear restraint due to technical/economic limitations may depend on the extent of motivations to acquire nuclear weapons. The proliferation literature typically emphasizes one or the other i.e. resource or motivational factors, while largely ignoring the complex relationship between

28 Stanley A. Erickson, “Economic and Technological Trends Affecting Nuclear Nonproliferation, Nonproliferation Review, 8 No. 2 (2001), 40-54; Erwin Häckel, “Towards Non-nuclear Security: Costs, Benefits, Requisites” in Security Without Nuclear Weapons? Different Perspectives on Non-nuclear Security, ed., Regina Cowen Karp (SIPRI: Oxford University Press, 1992).

29 Erickson, “Economic and Technological Trends”.

30 Dagobert L. Brito and Michael D. Intriligator, “The Economic and Political Incentives to Acquire Nuclear Weapons”, Security Studies 2 No. 3-4 (1993).

31 Häckel, “Towards Non-nuclear Security”.

the two. One exception mentioned above is Fuhrmann.32 Nuclear restraint can be explained by resource constraints and/or motivational changes. However, the literature has largely ignored the fact that whether a state “wants” nuclear weapons depends, at least to some extent, on how easy to acquire weapons or weapons-related capabilities. As Sagan sums this up: “Unfortunately, the field’s [political science] long-standing intellectual tradition of diving the proliferation puzzle into “supply-side” and “demand-side” factors has reduced attention on the crucial and complex relationship between the supply of nuclear technology and the demand for nuclear weapons.”33

This dissertation contributes to the literature by closely examining capability as well as motives for the nuclear programs in Iraq, Taiwan, Libya, and Iran.

(II) Motivational Factors

Realist/security-oriented Factors

The perceived causes and consequences to their security retain a central place for nations considering whether to develop nuclear weapons. Few deny the security implications of possessing nuclear weapons. This approach maintains that the security dilemma – where attempts to bolster one’s security through increasing military strength necessarily weakens or threatens another’s security – remains a central cause of states’ desire for nuclear weapons.

For Kenneth Waltz for example, states live in an anarchic self-help environment where they have to take the required steps to ensure their security. They will therefore seek to develop nuclear weapons in order to hedge against the possibility of being threatened with the same weapons – states will seek nuclear weapons in order to bolster their security through the

32 Fuhrmann, “Proliferation and Peaceful Nuclear Cooperation Agreements”.

33 Scott D. Sagan, “Nuclear Latency and Nuclear Proliferation”, in Potter, Forecasting Nuclear Proliferation, 81.

working of nuclear deterrence.34 The primary security contribution of nuclear weapons is deterring a nuclear enemy or as a substitute for weak conventional forces.35 Nuclear weapons can thus act as the great military equalizer, or at least to preserve the status quo. An important early study on the causes of proliferation discussed five security-related motives – deterring a nuclear rival, defending against invasion, using nuclear weapons as a weapon of last resort for survival, intimidating non-nuclear rivals, and strengthening influence and bargaining power within an alliance.36

One quantitative study assessing the impact of the drivers of proliferation has concluded that the security threat environment is an important factor determining proliferation. Singh and

Way find that security threats measured in terms of participation in an enduring rivalry and a militarized inter-state dispute offers a strong statistical significance in causing proliferation.37

This effect is somewhat lessened if the state receives security guarantees through an alliance with a superpower. Jo and Gartzke make similar conclusions on the centrality of insecurity leading to proliferation, particularly in the context of conventional threats in the absence of security guarantees.38 However, they make the interesting observation that states facing nuclear

34 Kenneth N. Waltz, “More is Better” in The Spread of Nuclear Weapons: A Debate Renewed, 2nd ed., Scott D. Sagan and Kenneth N. Waltz (New York: W. W. Norton, 2002).

35 Beaton and Maddox, Spread of Nuclear Weapons; Albert Wohlstetter et al, Swords from Plowshares: The Military Potential of Civilian Nuclear Energy (Chicago: University of Chicago Press, 1979).

36 Lewis A. Dunn and Herman Kahn, Trends in Nuclear Proliferation, 1975-1995: Projections, Problems, and Policy Options (New York: Hudson Institute, 1976), 1-4.

37 Sonali Singh and Christopher R. Way, “The Correlates of Nuclear Proliferation: A Quantitative Test”, Journal of Conflict Resolution, 48 No. 6 (2004).

38 Dong-Joon Jo and Erik Gartzke, “Determinants of Nuclear Weapons Proliferation”, Journal of Conflict Resolution, 51 No. 1 (2007).

adversaries are less likely to develop nuclear weapons themselves due to the fear of preventive attack.39

The security perspective explaining nuclear restraint involves two inter-related rationales.

One thread of argument emphasizes the potential for nuclear weapons to actually decrease security i.e. the negative security implications of possessing nuclear weapons by inducing rivals to arm themselves; such a perception may therefore lead to nuclear restraint. A second vein of thought considers restraint as being caused by the declining threat environment, which renders little role for nuclear weapons. Each argument is discussed in turn below.

Negative Security Externalities of Nuclear Weapons

Classical Realism views survival as the primary and ultimate interest of states, and power as a route to that end. It therefore considers the possibility that nuclear weapons could in fact worsen the security dilemma whereby other countries feel threatened from one state’s act of acquiring nuclear weapons. Zachary Davis has elaborated this argument, contending that such concerns drive some states to willingly give up the option of developing nuclear weapons by acceding to the Nuclear Non-Proliferation Treaty or NPT.40 States’ calculations on the likely effects of nuclearization reflect a cautious, practical understanding of the complex nature of security. For Davis, countries sign the NPT as non-nuclear weapons members as a conscious choice to uphold their security. The nonproliferation norm generated by the NPT regime is born out of this deliberate choice to remain non-nuclear, and the NPT is therefore “an expression of

39 Jo and Gartzke, “Determinants of Nuclear Weapons Proliferation”, 176-177. Both studies have been recently criticized on a No. of issues, especially for their different data coding. Coding the stage of a nuclear program for every year in every country naturally involves some arbitrariness due to incomplete information. Harald Müller and Andreas Schmidt, “The Little-Known Story of Deproliferation: Why States Give Up Nuclear Weapons Activities” in Potter, Forecasting Nuclear Proliferation, 131-133.

40 Zachary S. Davis, “The Realist Nuclear Regime”, Security Studies, 2 No. 3-4 (1993).

aggregate interests in controlling the spread of nuclear weapons.”41 He thus proposes a Realist conception of the nonproliferation regime, holding that although the security dilemma is the cause of proliferation, it also motivates states to establish the nonproliferation regime. Davis believes that this nonproliferation regime is maintained by security guarantees on the one hand, and inspections and export controls on the other. The international cooperation that drives the regime is not permanent or irreversible, but he expects it to continue because it is based on an unusually strong motivation – the desire to avoid the security dilemma worsened by the possession of nuclear weapons and to avert nuclear war.42

Those espousing a newer theoretical strand called “neo-classical realism” point out that unit-level variables affect how states respond to security threats. They argue that states can respond by internal or external balancing – the former referring to building up one’s defense capabilities, while the latter is based on alliance formation.43 According to Natasha Bajema, whether states react to security threats with nuclearization depends on their ability to extract resources, including raising money and attaining the technological capability to produce arms.44

Proposing a more radical view, Daniel Deudney argues that the “security materialist” branch of Realism strongly suggests few states will seek nuclear weapons. 45 According to security materialism, nuclear weapons actually increase the capabilities of states in such a way

41 Davis, “Realist Nuclear Regime”, 82.

42 Davis, “Realist Nuclear Regime”.

43 Natazha E. Bajema, “Beyond the Security Model: Assessing the Capacity of Neoclassical Realism for Forecasting Nuclear Proliferation”, in Potter, Forecasting Nuclear Proliferation, 69-70.

44 Bajema, “Beyond the Security Model”, 74-75.

45 Daniel Deudney, “Dividing Realism: Structural Realism versus Security Materialism on Nuclear Security and Proliferation”, Security Studies, 2 No. 3-4 (1993). Deudney defines security materialism in the following way: “The branch of Realist theory that posits that the type, size, and No. of the basic security providing institutions are determined by the material capabilities for destruction and protection can conveniently be labeled security materialism.” Deudney, “Dividing Realism”, 20. 26

as to reduce their security and limit their choices, so that possessing nuclear weapons in fact means being possessed by them.46

Stressing that nuclear restraint is caused by diverse factors, Mitchell Reiss also points to the counterproductive role of nuclear weapons in some instances.47 In Sweden for example, development of nuclear weapons may have portrayed it as overly aggressive and thus caused the

Soviet Union to intervene. Nuclearization could have pushed the Soviet Union to place greater emphasis on Scandinavian affairs48 or even provoked a Soviet attack.49 Similarly, the acquisition of nuclear weapons by Japan and South Korea would have worsened their security by jeopardizing their relations with the United States, the primary support of their security.50

T. V. Paul also stresses the negative security externalities of nuclear weapons i.e. the exacerbation of the security dilemma by threatening other states and thus pushing them to take counter-measures.51 Stressing that countries tend to be cautious when making decisions affecting their security, Paul proposes a Realist variant called “prudential Realism”. According to one aspect of this view, countries forego nuclear weapons because they decrease security by threatening other countries. This is because state interests do not always imply the maximization of power and a corresponding build-up of arms. Paul maintains that states make such choices because they operate on the “most-probable threat” rather than the worse-case scenario that is

46 Deudney, “Dividing Realism”.

47 Reiss, Without the Bomb; Reiss, Bridled Ambition. Reiss’ work is discussed in greater detail under the section on domestic political explanations of nuclear restraint.

48 This would weaken Swedish security indirectly – greater Soviet emphasis on Scandinavian matters would shake Finland’s neutrality, which in turn would deteriorate regional security and conceivably force Sweden to depart from its policy of noninvolvement in foreign affairs. Reiss, Without the Bomb, 252.

49 Reiss, Without the Bomb, 62-63, 73.

50 Reiss, Without the Bomb.

51 Paul, Power Versus Prudence. 27

often stressed by structural Realism, particularly offensive realism. Such non-nuclear choices, according to Paul, arise due to “security interdependence” within a region i.e. the mutual vulnerability among closely connected states in a geographically limited area. These states may decide to forgo nuclear weapons in order to achieve security.52

How might the security dilemma be worsened by the acquisition of nuclear weapons?53

Paul states that this may be the consequence of the responses of adversaries who may endeavor to balance (i.e. seek external assistance for protection), or even to undertake military strikes.

The state’s allies could also reduce its security by removing security guarantees or suspending military and economic aid in response to nuclearization.54

Absent or Declining Security Threats

A second aspect of security considerations tied in with the first is the perception of decline in security threats. T. V. Paul has carefully combined these two strands into his notion of prudential Realism, although not separating them out in this way. The absent or declining threat perspective suggests that a state may undertake nuclear restraint because of a changing security environment where former threats have dissipated. Paul considers three ideal-typical conditions

– the zone of high conflict involving protracted conflicts and enduring rivalries; the zone of moderate conflict entailing some security threats but also important economic goals; and the zone of low conflict characterized by high economic interdependence.55 The high-conflict zones

52 Paul, Power Versus Prudence, 15.

53 It must be noted that Paul is careful to state that his analysis is focused on non-great powers, whose security is more vulnerable and more affected by their regional environments. He believes that great powers however, operate according to the balance of power logic of structural Realism, where nuclear weapons can contribute substantially to security. Paul, Power Versus Prudence, 17-18.

54 Paul, Power Versus Prudence, 16.

55 Paul, Power Versus Prudence, 18-25.

are the Middle East, South Asia, cold war Europe, and the Korean peninsula; the moderate zone includes the southern cone of Latin America, the ASEAN region of Southeast Asia, and post- apartheid southern Africa; and the low conflict zones are Western Europe and North America.56

For the concept of nuclear restraint, Paul makes the following important assertions:

This model suggests that technologically capable states in zones of low and moderate conflict are most likely to forgo nuclear weapons, while a state in a high-conflict zone would have the greatest incentive to acquire such weapons, especially if it is engaged in a protracted conflict or enduring rivalry with an already existing or emerging nuclear- weapon state. If a technologically capable state in a high-conflict region forswears nuclear arms, it does so largely as a function of countervailing deterrent capability, provided either by an ally or by the state’s own capability, such as chemical weapons or conventional superiority, that can somewhat neutralize the nuclear capability of the adversary.57

It is Paul’s contention that states in the low-conflict region are the most likely to forgo nuclear weapons while those in the high-conflict zone are the least likely to do so.58 The only circumstances under which countries facing major security threats may nevertheless display nuclear restraint are: (a) receiving credible security guarantees, or (b) possessing other WMD or a superior conventional capability. According to him, states in the moderate conflict zone will seek nuclear weapons only if their rivals do so.59

In sum, Paul explains nuclear restraint in terms of (i) negative security externalities arising from security interdependence i.e. states closely tied to one another experience increased

56 Paul, Power Versus Prudence, 20-21.

57 Paul, Power Versus Prudence, 22.

58 Paul, Power Versus Prudence, 21-23.

59 Paul, Power Versus Prudence, 23. 29

threat perceptions if one state acquires nuclear weapons, thus leading them to take countermeasures; (ii) a state is in a low or moderate conflict zone, or (iii) a state facing high security threats receives security guarantees or has other mitigating military capabilities.

Davis, Deudney, Reiss, and Paul all argue that sometimes, nuclear weapons do not enhance security but actually decrease it.60 This is certainly an important point that is generally neglected in the mainstream Realist perspective on nuclear weapons. These authors hold that states are very conscious of the negative security externalities of nuclear weapons. Davis, Reiss, and Paul believe that security guarantees are an important cause of non-nuclear status. Davis places substantial emphasis on the role of the NPT in nuclear restraint, Reiss maintains that other aspects like domestic actors and economic incentives are important, while Paul believes that alliance relations or other domestic military capabilities, or the general lack of conflict are largely sufficient to explain restraint.

The Realist security-oriented explanations of nuclear restraint given above suggest an important cause of the non-nuclear weapons status of several countries. However, they are severely limited in their ability to explain many instances of nuclear restraint i.e. the slowing, stopping, or rolling back of existing nuclear weapons programs. While it is conceivable that some countries like Canada did not pursue nuclear weapons either because of possible negative security implications or because they did not sense major security threats (or both), these factors are insufficient to explain why a country that at one time may have perceived the security need for nuclear weapons later decides otherwise.61

60 Davis, “Realist Nuclear Regime”; Deudney, “Dividing Realism”; Paul, Power Versus Prudence; Reiss, Without the Bomb; Reiss, Bridled Ambition.

61 As argued in the dissertation, the negative security implications of the nuclear programs in Libya and Iran post- 2003 were influential in motivating restraint. However, the abstract security model does not adequately explain this change, whereby security factors once persuade nuclear pursuit, while at a different time leads to restraint.

The security perspective is inadequate to understand nuclear restraint since the inertia of national decision-making suggests that it is very difficult to reverse programs that are already begun – it is far more difficult to dismantle existing governmental, bureaucratic, and industrial structures related to the nuclear (or any other) program rather than to begin such efforts. This is partly due to entrenched interests tied to the nuclear program and partly due to the political task of rationalizing the decisions to the public. Further, the view that the removal of security threats that may have originally led to the weapons program now automatically leads to restraint is simplistic. Although the original motivations may be entirely absent today, it is surely not difficult to envisage situations where governments create new rationales for their nuclear weapons programs. This is particularly so because the extremely ambiguous concepts of

“national security” and national interests very conveniently lend themselves to varying, even contrary interpretations of security threats.62

T. V. Paul’s full-length book on nuclear forbearance provides valuable case studies of the security considerations driving nuclear restraint in several countries.63 One of the few works focusing on nuclear restraint, it contributes to the scholarly effort to emphasize this important but little analyzed topic. However, it suffers from some important shortcomings. First, since it is based in the Realist perspective, it is subject to the universal Realist dilemma that its concept of security/survival/threats is to some extent tautological. The argument borders a little close to the notion that states will acquire nuclear weapons when they feel insecure (i.e. when they need them) and will give them up when they don’t. By itself, the negative security implications of

62 Examples include the American, British, and French nuclear programs, whose original security concerns (Nazi Germany and the Soviet Union respectively) are no longer present, at least in the same form, today.

63 Paul, Power Versus Prudence.

nuclear weapons do not tell us specifically which states will reverse existing nuclear weapons programs, when they might do so, and precisely what causes them to undertake restraint.

Properly speaking though, Paul’s argument is not based on this aspect alone; he also emphasizes the role of conflict zones. However, there is again a tautological element here since a zone may be deemed low-conflict as a result of the absence of nuclear weapons rather than cause non-nuclear status. Also, Paul’s treatment of zones is incomplete – for example, since cold war Europe was a high conflict zone according to him, why did countries like Spain and

Italy not develop nuclear weapons? Similarly, why have Egypt and Syria remained non-nuclear in the high conflict region of the Middle East? These countries are not included among the case studies nor are they mentioned in the book. Furthermore, it is unclear as to what specific military capabilities would qualify as sufficient to meet the security needs of a state in a high- conflict zone. It is also not readily apparent why Britain and France as “great powers” would operate differently from other states, particularly in retaining their nuclear weapons despite being located in a strong low-conflict zone.

Third, although Paul seeks to cast his argument in overall Realist terms by focusing on security considerations at the state level alone, it is impossible for him to explain any case of nuclear restraint without reference to important sub-state factors. He asserts for example, that a country’s bureaucratic and political actors will be influential in determining policy only if its security environment allows it to be so.64 In placing such an overwhelming importance on security threat perceptions alone, Paul glosses over the critical role of domestic factors that he himself employs in his narrations of nuclear restraint. As he acknowledges, domestic-level

64 Paul, Power Versus Prudence, 26-27.

variables were crucial especially in the cases of Argentina and Brazil.65 In fact, his case studies directly show the central role played by the national leaders who decided to undertake nuclear restraint – in Canada, Liberal Prime Minister Pierre Trudeau “vehemently opposed” nuclear weapons acquisition;66 Swedish nuclear restraint was driven by domestic political differences between the Conservative Party arguing for nuclear weapons on the one hand, and the Liberal and Center parties taking positions on non-acquisition on the other, together with public opinion;67 in Switzerland, the government acted against the “popular mandate” by not seriously seeking nuclear weapons;68 and F. W. De Klerk’s election as president was “a watershed in the transition to non-nuclear status” in South Africa.69

Finally, Paul’s analysis shares a limitation with the other Realist studies discussed above

– declining threats are not sufficient to bring about nuclear restraint. If a state develops a new perspective as to the negative security externalities of nuclear weapons, this must be explained at the domestic level in terms of national leaders, interest groups, bureaucracies, or other sub- state actors. In other words, why did a state that had already embarked on a weapons program change its view and later decide that nuclear weapons brought more insecurity than security?

Although the changed policy may be caused by structural factors, it necessarily passes through the black box of decision-making and must be reflected by policy-makers for it to take effect.

This aspect is not adequately addressed by the Realist analyses.

65 Paul, Power Versus Prudence, 145-146.

66 Paul, Power Versus Prudence, 67.

67 Paul, Power Versus Prudence, 87-88.

68 Paul, Power Versus Prudence, 94-95.

69 Paul, Power Versus Prudence, 116.

Thus the Realist perspective points out that nuclear restraint may be caused by the negative consequences of nuclear weapons or the perception of declining threats, or both.

Although it contributes to our understanding of restraint, the concept is left substantially unexplained. In particular, what is the precise link between the perception of declining threats or negative security effects on the one hand, and the decision to undertake nuclear restraint? Why do such perceptions appear in cases where they were previously absent; which persons or organizations were influential in promoting such views? These questions are not answered by the Realist studies.

(2) Domestic Political/ Liberal Causes

Explanations based on the bureaucratic-organizational or domestic political aspects of nuclear decision-making stress the fragmented nature of the state as a conglomeration of numerous actors with varied interests and influence rather than as a comprehensive whole.

Drawing from classical works in bureaucratic politics like Halperin and Allison,70 this perspective opens up the black box of the state and its processes of decision-making to explain restraint in terms of domestic political changes.

Important actors in the domestic scene include those involved with the nuclear energy establishment (scientists, technicians, bureaucrats), those belonging to the military, individual politicians, and the mass public.71 According to Sagan, some of the political conditions leading to nuclear restraint are: the emergence of a new government which can more openly blame previous regimes for unsuccessful policies; the loss of power for actors who were strongly vocal

70 Graham T. Allison, Essence of Decision: Explaining the Cuban Missile Crisis (Boston: Little, Brown and Company, 1971); Morton H. Halperin, Bureaucratic Politics and Foreign Policy, (Washington, D. C.: Brookings Institution Press, 1974).

71 Sagan, “Why Do States Build Nuclear Weapons?”, 63-65.

about the necessity of a nuclear weapons program; and even the fear of the current government that later administrations may not make responsible decisions on the weapons program. Sagan in fact attributes all of these factors to South Africa’s nuclear rollback in the early 1990s.72

Just as nuclear pursuit can serve political interests by winning the support of groups favoring it73 and strengthening those holding political offices,74 nuclear restraint can also fulfill political interests. For example, it has been argued that the Argentine and Brazilian nuclear restraint were brought on by the emergence of liberal regimes desiring international assistance to meet their spiraling debts.75 Similarly, Avner Cohen points out that among other factors, domestic differences of opinion on whether to pursue nuclear weapons in Israel led to the slow and tentative weapons program in the 1950s.76

Reiss and Hymans emphasize the role of domestic political leadership in nuclear decision-making.77 Mitchell Reiss argues that the proclivities, interests, and calculations of the individuals in power greatly influence the state’s nuclear choices.78 He also points to the role of the domestic jockeying for power and public opinion as important determinants of a country’s decision on nuclear weapons. Reiss illustrates the following examples of domestic factors

72 Sagan, “Why Do States Build Nuclear Weapons?”, 79-71.

73 William Epstein, “Why States Go – And Don’t Go – Nuclear”, Annals of the American Academy of Political and Social Science, 430 No. 1 (1977), 25.

74 George H. Quester, The Politics of Nuclear Proliferation (Baltimore: Johns Hopkins University Press, 1973), 238; Robert A. Strong, “The Nuclear Weapons States: Why They Went Nuclear” in Nuclear Proliferation in the 1980s: Perspectives and Proposals, ed., William H. Kincade and Christopher Bertram (New York: St. Martin’s Press, 1982), 19.

75 Solingen, “Political Economy of Nuclear Restraint”, 157-162; Sagan, “Why Do States Build Nuclear Weapons?”, 71.

76 Avner Cohen, Israel and the Bomb (New York: Columbia University Press, 1998), 148-149.

77 Hymans, Psychology of Nuclear Proliferation; Reiss, Without the Bomb; Reiss, Bridled Ambition.

78 Reiss, Bridled Ambition.

leading to nuclear restraint – the delicate coalitional balance in the 1960s Swedish government led by the Social Democratic Party, strong public opinion against nuclear weapons in Japan, and the diversion of scarce government resources in India.79

According to Reiss, political leadership is “by far the single most significant” cause of nuclear restraint. He argues that ‘good’ leaders are able to realize the limited role of nuclear weapons in actually achieving the country’s objectives like political standing and economic growth, listing the following as such leaders: F. W. de Klerk of South Africa, Carlos Menem of

Argentina, Fernando Collor of Brazil, and Nursultan Nazarbayev of Kazakhstan.80 Most prominent among them was De Klerk, whose “personal imprint” was crucial for South Africa’s restraint -- De Klerk had the foresight to recognize the erosion of apartheid, wisely deciding it was better to allow a smooth transition to majority rule rather than impose repressive measures which would only bring more violence.81 The domestic actor perspective also highlights the facilitating role played by the absence of nuclear weapons supporters such as Wally Grant and

A. J. A. Roux who had founded the South African weapons program and were now retired from the Atomic Energy Commission.82

Although this model highlighting the role of individual actors is important, it suffers from the general problem of the absence of an overall theory of domestic politics. Leadership does matter, and individual leaders like Qaddafi in Libya and De Klerk in South Africa have been highly influential in undertaking nuclear restraint decisions. However, it is difficult to generalize or hypothesize a priori which countries are likely to restrain their nuclear programs based on

79 Reiss, Without the Bomb.

80 Reiss, Bridled Ambition, 329.

81 Reiss, Bridled Ambition, 19.

82 Reiss, Bridled Ambition, 20-22. 36

who their leaders are. Thus while this perspective emphasizes the importance of domestic actors, it does not establish an unambiguous relationship between individuals and decisions on the nuclear weapons program.

In an attempt to overcome this problem, Jacques Hymans propounds a theory on how leaders make nuclear decisions based on their conceptions of national identity.83 According to this, leaders with an “oppositional nationalist” identity are most likely to take a nuclear weapons decision. Drawing from a combination of fear and pride, this identity refers to a sense of “us versus them”, where “us” is equal to or superior to “them”.84 Although based heavily in the

Constructivist perspective, Hymans’ theory essentially argues that the decision on nuclear pursuit or restraint depends on who the leaders are (and what their beliefs are). Hymans makes the important contribution of explicating the role of leaders and their beliefs. However, he does not address matters such as the relative domestic power of these leaders. Moreover, it would be difficult to categorize international leaders as being “oppositional nationalist” or not without a detailed case study. In other words, his theory does not readily lend itself to predictions or explanations of nuclear decisions beyond the four countries he examines (Argentina, India,

France, and Australia).

Etel Solingen offers another domestic political explanation of nuclear restraint.85 She argues that liberalizing governments tend to slow down or end their nuclear weapons programs in order to be better integrated into global markets and politics. Solingen’s ideal-typical

83 Hymans, Psychology of Nuclear Proliferation. Although Hymans himself classifies his theory as “psychological constructivist”, I categorize it in the domestic politics model since it essentially argues that national nuclear decisions are greatly affected by the beliefs of individual leaders. Hymans, “The Study of Nuclear Proliferation and Nonproliferation” in Potter, Forecasting Nuclear Proliferation, 31.

84 Hymans, Psychology of Nuclear Proliferation, 22-30.

85 Solingen, “Political Economy of Nuclear Restraint”; Solingen, Nuclear Logics.

internationalizing model consists of leaders “who stake their political survival on economic growth and internationalization”.86 She argues that such leaders tend to implement economic reforms and export-led industrialization strategies in an effort to reduce macroeconomic and political instability which would otherwise repel foreign investment. Integrating into the global economy requires a durable, less threatening environment to attract foreign investment, make sanctions unlikely, support international institutions, and improve reputations as respectable members of the international community.87 Regimes espousing such policies will reverse any existing nuclear weapons programs because it would “introduce tensions” and reduce market competitiveness as well as international political and economic support.88 In addition, a nuclear weapons program is expected to add to the country’s economic costs, be distracting from the main efforts of reformation, and strengthen domestic opponents to internationalization. This connection between attempts to internationalize and nuclear restraint is further bolstered by the perception of a Western norm that chastises the acquisition of nuclear weapons.89

Cautioning that her proposition is probabilistic rather than deterministic, Solingen states that it is bounded by three considerations – nuclear restraint may sometimes be caused simply by the lack of technical or economic abilities rather than internationalization (the examples of

Sudan and Syria are cited); national decisions are influenced by the neighborhood orientation to internationalization i.e. is affected by regional trends toward liberalization; and, the stage of the nuclear weapons program and timing are important in that internationalization is more likely to

86 Solingen, Nuclear Logics, 42.

87 Solingen, Nuclear Logics, 42-43.

88 Solingen, Nuclear Logics, 43.

89 Solingen, Nuclear Logics, 43.

lead to restraint in the early stages of the weapons programs.90 She further warns that two additional factors that will affect the success of her model are the strength of the regime and the type of regime. Leaders who enjoy strong power positions domestically are far more able to implement their preferences than those who work within coalitions or divided power structures.

Also, the type of regime matters to the extent that it creates the institutional context within which leaders function such as autocratic or democratic, presidential or parliamentary, etc.

(although autocratic leaders may sometimes have less institutional freedom and power than democratic ones).91 In sum then, Solingen’s argument is that:

Only leaders and ruling coalitions advancing their political survival through export-led industrialization undertook effective commitments to denuclearize (Japan, Taiwan, South Korea, Egypt under Sadat, South Africa, Brazil, and Argentina). Nuclear decisions were nested in a broader shift toward internationalization in economics and security.92

Internationalizing models are not necessary but likely to be sufficient for denuclearization except under two circumstances: (a) when neighboring inward-looking regimes seek nuclear weapons (or other WMD); and (b) when nuclear weapons are acquired prior to the inception of internationalizing models.93

Without doubt, Solingen’s explanation of nuclear restraint is a novel approach based on a unique combination of the role of domestic politics and the drive toward globalization. In linking the two, she advances a rare argument emphasizing the importance of international trade

90 Solingen, Nuclear Logics, 18-19.

91 Solingen, Nuclear Logics, 44-45.

92 Solingen, Nuclear Logics, 45.

93 Solingen, Nuclear Logics, 51.

and investment in restraint. Although it is thus a refreshing viewpoint, it nevertheless suffers from two shortcomings.

First, Solingen does not offer an explication of the precise process by which liberalization may lead to nuclear restraint. As discussed above, she hints at the role of factors such as the desire to attract foreign investment, avoid sanctions, support international institutions, and improve international standing.94 But the actual connection between the opening of markets and the decision to decelerate the nuclear weapons program is unclear. It is fair to presume as she does, that governments embarking on economic liberalization seek to project the image of a stable environment, a desirable venue for investment, and by extension a reputable international status. However, the leap between these goals and that of nuclear restraint is arguably a large one since the economic and political benefits of restraint is by no means guaranteed, and there are possibly other, more beneficial ways of achieving these objectives. For example, economic incentives such as low taxes for foreign investors, democratization, and the absence of political violence or stable law and order can be more direct ways of internationalizing than undertaking restraint.

Second, Solingen assumes that any government seeking economic development for its country will necessarily do so through export-led growth. Examples of leaders from history however, suggest otherwise – Nehru in India, Peron in Argentina, and Mahathir in Malaysia. It is more true today that the “Washington Consensus” advocating privatization and liberalization has come to be accepted the world over, especially after the collapse of the Soviet Union; but in the early post-war period, many newly independent developing countries were experimenting with socialist-style and nationalist “inward looking” policies. In addition, Solingen appears to

94 Solingen, Nuclear Logics, 42-43.

assume that leaders favoring liberalization will not be nationalistic.95 Although it is far more common that liberal economic principles of low tariffs and private investment are associated with liberal politics and international accommodation, it is by no means impossible as evident in the Hindu-nationalist liberalizing government of the Bharatiya Janata Party in India in the

1990s. In fact, India also poses a serious challenge to Solingen’s thesis since its 1998 nuclear tests were conducted several years after the start of economic liberalization in 1991, following decades of state-centered import-substitutive protectionist measures.

Overall, the domestic politics perspective highlights the disjointed nature of states and the influential role of particular individuals and groups. As Meyer points out, domestic politics act as a filter for other motivations since the actual development and execution of a nuclear weapons program must necessarily be weaved in the domestic context.96 These analyses improve our knowledge of nuclear restraint by highlighting the role of key individuals and organizations; but they are incomplete in that they offer little understanding of why certain individuals or ideas become dominant at a later point although they were ineffective earlier. The domestic political argument actually suffers from a problem opposite to that of Realism – it tends to be too sui generis or idiosyncratic while the latter may be overly abstract. Although some analyses within this perspective suggest that sanctions or their expectation may play a role in nuclear restraint, they do not tell us when or how this may happen. This dissertation seeks to fill in this gap by closely examining that link.

95 As Hymans points out, “nationalism and inward economic orientation are clearly separable analytically.” Hymans, “The Study of Nuclear Proliferation and Nonproliferation”, 30.

96 Meyer, Dynamics of Nuclear Proliferation.

(3) Norm-based/ Constructivist Aspects

The final category of explanations for nuclear restraint stresses the importance of international norms in changing or upholding “perceptions of appropriate and modern behavior.”97 Even though nuclear weapons were seen as status symbols in the early post-war period,98 the gradual emergence of norms against the spread and use of nuclear weapons may contribute to restraint. In keeping with the neoliberal institutionalist literature on regimes,99

Scott Sagan suggests that the nuclear nonproliferation norm was originally established because of the backing it received from the most powerful states, but that it was sustained due to the stickiness of norms and institutions.100 In other words once instituted, norms have lives of their own so that states are constrained by them, including the powerful states that first established the norms. Sagan writes, “The history of nuclear proliferation is particularly interesting in this regard because a major discontinuity – a shift in nuclear norms – has emerged as the result of the NPT regime.”101 According to him, the NPT has shifted international perceptions from the earlier view that nuclear weapons generate prestige to a situation where status is seen as deriving from disavowing nuclear weapons.

Sagan applies the norms model to explain Ukraine’s nuclear restraint, arguing that other important factors such as Ukraine’s desire to be independent and economic sanctions would

97 Sagan, “Why Do States Build Nuclear Weapons?”, 75.

98 Beaton and Maddox, Spread of Nuclear Weapons; Dunn and Kahn, Trends in Nuclear Proliferation; Epstein, “Why States Go – And Don’t Go – Nuclear”; George H. Quester, “Reducing the Incentives to Proliferation”, Annals of the American Academy of Political and Social Science, 430 No. 1 (1977); George H. Quester, “Conceptions of Nuclear Threshold Status”, in Regina Cowen Karp, ed., Security With Nuclear Weapons? Different Perspectives on National Security (SIPRI: Oxford University Press, 1991).

99 Robert O. Keohane, After Hegemony: Cooperation and Discord in the World Political Economy (Princeton: Princeton University Press, 1984).

100 Sagan, “Why Do States Build Nuclear Weapons?”, 75-76.

101 Sagan, “Why Do States Build Nuclear Weapons?”, 76. 42

have had far less weight in the absence of the global nonproliferation norm.102 He maintains that in the absence of the NPT, Ukraine with nuclear weapons would have found itself in the prestigious company of states like France rather than being seen in the context of “dissenters like India and Pakistan, and pariahs like Iraq and North Korea.”103

Several other scholars have also emphasized the role of the nonproliferation norm in inducing nuclear restraint. Long and Grillot explain restraint in South Africa and Ukraine in terms of ideas and beliefs on nuclear acquisition.104 They hold that the nuclear decisions of these countries were very closely tied with their perceptions of being part of the West – despite having a Western identity, South Africa under the National Party sought nuclear weapons due to its severe isolation; its later decision on restraint was brought about by the changed environment which made it necessary to end both apartheid and the weapons program in order to remain allied with the West. Similarly, they believe that Ukraine renounced nuclear weapons because of its belief about its place in the Western community of liberal democratic states.105

Ted Greenwood et al have noted that the nonproliferation norm is a disincentive to proliferation by making it more costly in political terms.106 Meyer believes that international legal commitments or “peaceful reputations” such as in Switzerland, India, and 1970s Sweden could act as important dissuasive factors.107 Reiss states that the NPT helped states to “advertise

102 Sagan, “Why Do States Build Nuclear Weapons?”, 80-82.

103 Sagan, “Why Do States Build Nuclear Weapons?”, 82.

104 William J. Long and Suzette R. Grillot, “Ideas, Beliefs, and Nuclear Policies: The Cases of South Africa and Ukraine”, Nonproliferation Review, 7 No. 1 (2000).

105 Long and Grillot, “Ideas, Beliefs, and Nuclear Policies”.

106 Ted Greenwood, Harold A. Feiveson, and Theodore B. Taylor, Nuclear Proliferation: Motivations, Capabilities, and Strategies for Control (New York: McGraw-Hill, 1977).

107 Meyer, Dynamics of Nuclear Proliferation, 67-72.

their nonnuclear intentions”.108 Notwithstanding their emphasis on the nonproliferation norm, these authors believe that such socio-psychological aspects have at most an implicit or subtle impact – “… the international nonproliferation regime did not directly compel any of the nine countries in this study to reverse, stop, or slow down their nuclear ambitions.”109 This is echoed by Greenwood et al, who argue that the nonproliferation norm was not a “decisive factor” in nuclear restraint, and Meyer, who believes that such normative factors have only “moderate effects.”110

The ideational explanation of nuclear restraint is limited, primarily because the presumed emergence of the nonproliferation norm should logically apply to all states at a given time.

Perhaps this is constrained by the relationship of the targeted state to overall global politics, so that we might expect “pariah” or “rogue” states to be less concerned about such normative considerations.111 Conversely, their international isolation might generate a deeper desire to be recognized and respected. This uncertainty of predictions from the prestige perspective limits its ability to explain nuclear restraint – on the one hand if there is a nonproliferation norm, it should apply to all states at a given time, and thus all may be equally induced toward nuclear restraint on the basis of an expected increase in international standing from abiding with the norm; on the other hand, it could be argued both ways for isolated states -- that such prestige calculations are irrelevant to them since they are already at the margins of international society, or that they desire respect even more strongly due to their outcast status. Although the nonproliferation

108 Reiss, Without the Bomb, 263.

109 Reiss, Bridled Ambition, 331.

110 Greenwood et al, Nuclear Proliferation; Meyer, Dynamics of Nuclear Proliferation, 104.

111 Richard K. Betts, “Paranoids, Pygmies, Pariahs and Nonproliferation Revisited”, Security Studies, 2 No. 3-4 (1993).

norm has itself evolved over time becoming well established with the indefinite extension of the

NPT in 1995 and 2005, at any point it should apply to all countries on the basis of their relations with the international community. The status perspective is therefore indeterminate in explaining why particular countries may be more susceptible and responsive to global norms than others. In fact, it would seem that we cannot discern a state’s outlook on the importance of international prestige without peering into domestic politics and national perspectives.

Other Works

Two sets of works are discussed separately here (although one has already been mentioned) as they do not fall wholly into any one category discussed above – Mitchell Reiss’s studies on nuclear restraint, and the work of Campbell et al112 on the possibility that restraint itself may be retracted. Mitchell Reiss was the first to present a focused study on the subject of nuclear restraint. In his two volumes, Reiss considers a total of thirteen country case studies that have at various points displayed nuclear restraint.113 The focus of his analysis is in explaining why so many technically capable states that sometimes had nuclear weapons programs (or simply inherited nuclear weapons as in the case of the former Soviet states of Ukraine, Belarus, and Kazakhstan) later slowed down or renounced nuclear weapons. He therefore rightly emphasizes the puzzle of nuclear restraint in that countries with the means, opportunity, and the motives nevertheless did not culminate their efforts in nuclear weapons acquisition. This is particularly puzzling in light of the fact that threatening to “go nuclear” can well yield great benefits in the form of security assurances, arms supplies, or economic.114

112 Campbell, Reiss, and Einhorn, Nuclear Tipping Point.

113 Reiss, Without the Bomb; Reiss, Bridled Ambition.

114 Reiss, Without the Bomb, xviii.

According to Reiss, the primary “source of nuclear restraint” is found in domestic factors in the form of specific leaders, the pulls of domestic politics, public opinion, and economic costs. But the overall thrust of Reiss’ works is to emphasize the multi-causal path to nuclear restraint i.e. a range of causes are usually present. Apart from domestic politics, other important reasons for restraint include the changing security environment, “dollar nonproliferation diplomacy”, US and other bilateral nonproliferation efforts, and the international nonproliferation regime led by the NPT.

Although stressing the role of domestic politics, Reiss points to the importance of security perceptions in all his case studies. Along the lines of T. V. Paul, he suggests that some countries like South Africa, Argentina, and Brazil may have undertaken nuclear restraint partly due to decreasing threat perceptions after the cold war while others like India, Pakistan, and

North Korea pursued nuclear weapons under increasing threats.115 Similarly, Sweden restrained its nuclear program out of the concern that nuclear acquisition could invite a Soviet attack;116

South Korea feared the termination of its bilateral relationship with the United States;117 and

Israel did not adopt an overt nuclear posture to avoid losing American support.118

Reiss discusses another different factor called the “dollar nonproliferation diplomacy”, which refers to the use of financial and commercial levers in the form of ‘carrots’ to induce nuclear restraint.119 The principal countries that benefited from such economic inducements were North Korea, Ukraine, Belarus, and Kazakhstan. Other efforts with potential proliferators

115 Reiss, Bridled Ambition, 323-324.

116 Reiss, Without the Bomb, 38, 63

117 Reiss, Without the Bomb, 93-94, 98

118 Reiss, Without the Bomb, 165-166.

119 Reiss, Bridled Ambition, 326-328. 46

entailed both carrots and sticks, such as Japan and South Korea (a combination of carrots and sticks).

Reiss considers the nonproliferation norm as instituted in the NPT to be a secondary contributing factor to nuclear restraint. The main part played by the regime is in assuring neighbors, rivals, and even allies that the particular state is committed to a non-nuclear weapons status under international law.120 International nonproliferation efforts therefore have played an indirect role in nuclear restraint, but in no instance were they the primary cause. In short, Reiss believes that nuclear restraint is caused by a variety of factors. As he states, “The most effective nonproliferation strategy will be one based on a recognition of the multiple sources of nuclear restraint.”121

Campbell et al argue that countries which reversed their nuclear weapons programs in the past may decide to restart efforts at weaponization due to changing circumstances.122 They present eight case studies, laying out the specific factors involved in each country. In his chapter, Kurt Campbell lists five causes that may lead a state to retract from its past decisions on nuclear restraint – changes in US foreign policy such as different approaches to deterrence, preemption, etc.; the erosion of the nonproliferation regime as a result of increasing violations by “rogue states”; decreasing regional or global security due to the classic “chain reaction” of nuclear proliferation whereby the acquisition of nuclear weapons by one country makes its rival or neighbor insecure, leading to proliferation which then begets further proliferation; regimes that are on their way out may attempt nuclearization in a last-ditch effort to reinstate themselves

120 Reiss, Bridled Ambition, 331.

121 Reiss, Without the Bomb, 266.

122 Campbell, Reiss, and Einhorn, Nuclear Tipping Point.

in power; and finally, the increasing availability of technology now makes it far easier to build nuclear weapons.123

All these possible causes of nuclearization involve changes in the previous reasons that had led to restraint i.e. states may retract their non-nuclear decisions if circumstances alter so as to devalue some of the original considerations. Robert Einhorn makes this point in his chapter by considering how the previous security, domestic politics, and international institutional factors causing restraint may now change in favor of nuclear pursuit.124

In pointing out that nuclear restraint is itself reversible, the Campbell et al volume performs the valuable service of cautioning against smug confidence on restraint. For the purpose of this dissertation however, the authors do not address the past sources of restraint or the role of economic sanctions in particular.

This research is built on some of the insights gleaned from the studies by Mitchell Reiss, especially in pointing out the context-dependent nature of nuclear restraint. From the case studies of scholars such as Reiss, Paul, and Solingen,125 it is apparent that several causal factors were at play in bringing about restraint. As always, the task of social science is to make sense of a messy world, where most phenomena display the feature of equifinality or many causal paths.

Conclusion: Literature on Nuclear Nonproliferation

As discussed above, the major works examining the causes of nuclear restraint are Reiss,

Paul, and Solingen. To sum up their arguments, Mitchell Reiss points to the complex nature of

123 Kurt M. Campbell, “Reconsidering a Nuclear Future: Why Countries Might Cross Over to the Other Side”, in Campbell, Reiss, and Einhorn, Nuclear Tipping Point.

124 Robert J. Einhorn, “Will the Abstainers Reconsider? Focusing on Individual Cases” in Campbell, Reiss, and Einhorn, Nuclear Tipping Point.

125 Paul, Power Versus Prudence; Reiss, Without the Bomb; Reiss, Bridled Ambition; Solingen, Nuclear Logics.

nuclear restraint, highlighting domestic political as well as bilateral security and other factors in the slowing down of weapons programs.126 For T. V. Paul, the primary explanation lies in decreasing threat perceptions and the realization that nuclear weapons may in fact worsen a country’s security.127 Finally, Etel Solingen maintains that nuclear restraint is often caused by economic liberalization.128

The larger proliferation literature tells us that nuclear weapons pursuit and restraint are determined by resource factors (technological/economic capacity) as well as motivational elements. The latter are classified into Realist-security oriented factors, bureaucratic- organizational causes, and norm-based aspects. Resource factors show the supply-side of proliferation, emphasizing that proliferation cannot occur unless there a state has the appropriate technical and financial resources. Motivational factors form the demand-side causes of proliferation. The literature concludes that technical-economic capacity is a necessary but not sufficient condition for proliferation, and that it must be bolstered by motivational factors. It also expects that such resource difficulties are unlikely to lead to restraint since the state can continue to seek alternate suppliers.

The literature shows how the three categories of motives – security, domestic politics, and prestige – can persuade a state to undertake nuclear restraint. Restraint may be caused by the perception of negative security externalities from nuclearization, or from the view of declining security threats, or both. The domestic politics explanation holds that changes in internal political and bureaucratic factors can lead to nuclear restraint. Etel Solingen129 offers a

126 Reiss, Without the Bomb; Reiss, Bridled Ambition.

127 Paul, Power Versus Prudence.

128 Solingen, “Political Economy of Nuclear Restraint”; Solingen, Nuclear Logics.

129 Solingen, “Political Economy of Nuclear Restraint”; Solingen, Nuclear Logics. 49

novel argument with a domestic politics perspective by maintaining that liberalizing governments tend to undertake restraint for the purpose of integrating into the global economy and polity. Finally, the norm-based explanation of nuclear restraint holds that countries terminate their weapons pursuit in response to the global nonproliferation norm.

The dissertation organizes its country analyses around the fundamental distinction of the two sets of factors affecting nuclear programs – resource factors and motives. While resource factors are sub-divided into technological and financial, motives follow Sagan’s three-fold classification into the security, domestic politics, and prestige models.

Below I offer an overview of the much larger body of work addressing economic sanctions. Following this, I discuss a recent full-length work that examines the sanctions impact on nuclear proliferation.

Economic Sanctions

The literature on economic sanctions centers on the question of whether sanctions are an effective instrument of statecraft in achieving desired policy changes in the targeted state. Until recently, this has generally been framed as the question of whether sanctions “work” or not.

Recent literature attempts to offer a more nuanced understanding of the processes by which the impact of sanctions may reverberate to produce policy change. In this sub-section, I first consider the general definitions of sanctions, which tend to agree to a common understanding. I then discuss the concept of sanctions “success” and “failure” before turning to a review of the general literature on economic sanctions. Finally, I summarize the contributions of a recent volume that examines the effect of sanctions on nuclear proliferation.

Definition of Sanctions

Most scholars define economic sanctions as coercion by the withdrawal of trade or other economic relations for the political purposes of changing specific policies of the targeted country. They emphasize that sanctions involve the suspension of “customary economic relations”, suggesting that sanctions can be understood only in the context of the prior economic relations between the sender and target. The definitions of sanctions from some of the classic works are given below.

“Economic sanctions are economic measures directed to political objectives.”130

Economic power is defined as “the imposition of economic pain by one government on another in order to attain some political goal.”131 Sanctions are “a collective action against a state considered to be violating international law taken to compel that state to conform.”132

Trade sanctions are “measures in which one country (the initiator) publicly suspends a major portion of its trade with another country (the target) to attain political objectives.”133

Economic sanctions are “the deliberate, government-inspired withdrawal, or threat of withdrawal, of customary trade or financial relations”, where “customary” refers to “levels of trade and financial activity that would probably have occurred in the absence of sanctions.”134

130 James Barber, “Economic Sanctions as a Policy Instrument”, International Affairs, 55 No. 3 (1979), 367.

131 Miroslav Nincic and Peter Wallensteen, “Economic Coercion and Foreign Policy” in Nincic and Wallensteen, eds., Dilemmas of Economic Coercion: Sanctions in World Politics (New York: Praeger Publishers, 1983), 3.

132 M. S. Daoudi and M. S. Dajani, Economic Sanctions: Ideals and Experience (Boston: Routledge and Kegan Paul, 1983), 5.

133 James M. Lindsay, “Trade Sanctions as Policy Instruments: A Re-Examination”, International Studies Quarterly, 30 No. 2 (1986), 154, emphasis original.

134 Gary Clyde Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed. (Washington, D. C.: Peterson Institute for International Economics, 2007), 3.

“…sanctions are defined as the denial of customary interactions (strategic, economic, or social); they are intended to promote social, political, or economic change in a target state.”135

“Economic coercion is the threat or act by a nation-state or coalition of nation-states, called the sender, to disrupt economic exchange with another nation-state, called the target, unless the targeted country acquiesces to an articulated political demand.”136

Sanctions are “international instruments of statecraft that punish or deny benefits to leaders, ruling coalitions, or broader constituencies in a given state, in an effort to dissuade those targets from pursuing or supporting the acquisition of nuclear weapons.”137

Although these definitions are strikingly similar, they differ in some specifics – while

Daoudi and Dajani view sanctions mainly as a moral instrument seeking to uphold international law, Nincic and Wallensteen consider them in more negative terms as ways of inflicting economic pain for the purpose of political gain.138 Nevertheless, sanctions are generally considered to have two important features: the aim is to change target behavior, and they entail the withdrawal of customary economic relations between the sender and target. Further,

Hufbauer et al include within their definition the threat of withdrawing customary economic relations.139 Barring Crawford and Klotz, the definitions presented above focus on the coercive aspect of sanctions, which are generally considered the primary way in which sanctions may effect change in the target.140 However, as the review of the sanctions literature will show,

135 Neta C. Crawford and Audie Klotz, eds., How Sanctions Work: Lessons from South Africa (New York: St. Martin’s Press, 1999). 5.

136 Daniel W. Drezner, The Sanctions Paradox: Economic Statecraft and International Relations (New York: Cambridge University Press, 1999), 2.

137 Etel Solingen, “Introduction: the domestic distributional effects of sanctions and positive inducements” in Etel Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 5, emphasis mine.

138 Daoudi and Dajani, Economic Sanctions; Nincic and Wallensteen, “Economic Coercion”.

139 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed.

140 Crawford and Klotz, How Sanctions Work. 52

sanctions can also contribute to nuclear restraint by limiting the resources available for the program.

Based on these delineations from the literature, I define economic sanctions as the deliberate government withdrawal or threat of withdrawal of customary economic relations to change particular policies or aspects of the targeted country.141 In keeping with the literature, I use the term ‘sender’ to refer to the country or group of countries imposing sanctions, and

‘target’ to indicate the country that receives the sanctions. Following Lindsay’s definition, I determine when sanctions occur according to the public articulation or action of declaring sanctions142 i.e. sanctions are deemed to have been imposed when the sender(s) announce so or act accordingly.

“Success” and “Failure” with Sanctions

Since sanctions are economic tools used for the purpose of political change in the target state, they are considered to be successful when the desired change is realized and unsuccessful when it is not. Given this basic premise, scholars differ in the understanding of the specific goals sought by the sender as well as in differences of opinion on the role of costs in assessing sanctions success. Most authors view changes in target policy as the golden requirement for sanctions to be considered a success.143

141 This emphasizes that restraint may not necessarily be a policy change, but could be unintended by the target.

142 Lindsay, “Trade Sanctions as Policy Instruments”.

143 Steve Chan and A. Cooper Drury, eds., Economic Statecraft: Theory and Practice (Macmillan Press Limited, 2000); Cortright and Lopez, Economic Sanctions; Crawford and Klotz, How Sanctions Work; Margaret P. Doxey, Economic Sanctions and International Enforcement (New York: Oxford University Press, 1980); Drezner, Sanctions Paradox; Hufbauer et al, Economic Sanctions Reconsidered; Nincic and Wallensteen, Dilemmas of Economic Coercion.

Some authors hold the alternate view that sanctions can be considered successful if their overall cost-benefit template is better than that offered by other policy instruments, rather than focusing on target behavior alone. Baldwin strongly argues that the success of a policy tool cannot be gauged simply by looking at its outcome; rather, it can be assessed only by comparing that outcome with the costs involved in achieving it.144 Thus, he maintains, the absolute costs incurred in using sanctions when compared to, say, the use of diplomacy, may be substantially higher; however, such a comparison is faulty. He believes that sanctions are often successful when compared with the low costs and minimal results of diplomacy on the one hand, and the high costs and good results of the use of military force on the other.145 Similarly, O’Sullivan holds that focusing solely on the costs or the outcome of sanctions obscures the overall picture of the net costs and benefits from the use of sanctions.146

Other scholars offer a broader concept of sanctions success to include their ability to achieve additional goals such as deterrence, punishment, signaling or symbolic effects, and the containment of the target regime. Knorr states that sanctions could be used simply to hurt or punish the target, or to strengthen another state.147 For Daoudi and Dajani, sanctions work primarily by imposing symbolic effects through ostracism and maintaining the sender’s reputation;148 they believe that the success of sanctions must ultimately be measured in terms of their ability to prevent war. Eland and O’Sullivan hold that sanctions can succeed by weakening

144 Baldwin, Economic Statecraft.

145 Baldwin, Economic Statecraft, 121-122.

146 Meghan L. O’Sullivan, Shrewd Sanctions: Statecraft and State Sponsors of Terrorism (Washington, D. C.: Brookings Institution Press, 2003), 26-30.

147 Klaus Eugen Knorr, The Power of Nations: The Political Economy of International Relations (New York: Basic Books, 1975), 81.

148 Daoudi and Dajani, Economic Sanctions, 161.

the target regime, thus containing it.149 In the third edition of their work, Hufbauer et al point out that even the famously failed sanctions cases such as Iraq and Cuba often tend to have important deterrent effects on other countries by signaling US resolve.150 In addition, sanctions can be aimed at merely expressing disapproval, rather than seeking policy change. Often, sanctions are the result of domestic pressure in the sender country to “do something” in response to some atrocity.151 By such yardsticks, sanctions can be a considered a success without a change in the target’s policy.

Sanctions Literature

Much of the literature on sanctions can be categorized according to a framework presented by Robert Pape, a strong sanctions critic.152 The “first wave” theorists of the 1960s and 70s generally agreed that sanctions do not work; the “second wave” scholars from the mid-1980s countered this predominant view by arguing that sanctions are more useful than normally given credit for. Despite this second line of thought, the overall consensus today is that economic sanctions are not effective instruments of state policy and that they generally do not achieve the desired objectives. Even the second-wave proponents tend to be very cautious in stating that sanctions have more usefulness than “commonly thought” and do not claim that they are successful a majority of the time.153

149 Ivan Eland, “Economic Sanctions as Tools of Foreign Policy” in Cortright and Lopez, ed., Economic Sanctions; O’Sullivan, Shrewd Sanctions, 289.

150 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., 157.

151 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., 5-7.

152 Robert A. Pape, “Why Economic Sanctions Do Not Work”, International Security, 22 No. 2 (1997).

153 At most, they argue that sanctions work about one-third of the time. Hufbauer et al, Economic Sanctions Reconsidered, 2nd ed., 1990.

Prior to what Pape calls the “first-wave” of sanctions theory in the 1960s and 70s, the common understanding viewed sanctions as powerful tools for achieving desired ends. In fact, sanctions were believed to have been effective in ancient Greece, possibly giving rise to the

Peloponnesian War between Athens and Sparta. Athenian imposition of sanctions against the city-state of Megara, a Spartan ally – known as the “Megarian decree” -- marks one of the earliest recorded instances of economic sanctions. Spartan ultimatums to Athens about lifting the sanctions ultimately led to war between the two when Athens refused. In his classic work,

Albert Hirschman showed how states can use trade as an alternative to war through what he terms the “influence effect” of trade -- the ability to disrupt existing commercial relations.154

Hence a state has great influence over another that is dependent on it for trade and commerce, and the goal of countries seeking to use this power is to increase the trade dependence of others on them. Hirschman argues that this was effectively done by Germany in the early twentieth century.

In the 1920s and 30s, the use of sanctions was generally tied to strong moral elements as seen in sanctions by the League of Nations against Italy for its invasion of Ethiopia, and Japan for its attack on Manchuria.155 However, sanctions failed to avert aggression in the 1930s and

40s and to change political and social practices in the white-ruled regimes of Rhodesia and

South Africa in the 1960s and 70s. This led to a new school of thought on the ineffectiveness of sanctions, which Pape refers to as the first-wave theory. It was followed by the second wave of scholars who, while not reverting to the original position that sanctions are powerful

154 Albert O. Hirschman, National Power and the Structure of Foreign Trade (Berkley and Los Angeles: University of California Press, 1945).

155 Daoudi and Dajani, Economic Sanctions.

instruments, advocated that they may be more effective than they are usually given credit for.

The first and second wave scholarship on sanctions is discussed below.

“First Wave”: Sanctions do not work

The classic work that forms the foundation for this perspective on the limited utility of sanctions is Johan Galtung’s1967 article.156 Based on a study of the impact of British sanctions against Rhodesia, Galtung argued that economic sanctions were unlikely to bring the desired changes due to countermeasures adopted by the targeted state. In particular, the three kinds of actions a target can take are: “train[ing] itself in sacrifice,” restructuring the economy by finding substitutes, and trading with countries not imposing sanctions (or by smuggling if sanctions are universal).157

Galtung strongly criticized the view that sanctions are powerful tools by referring to such a “theory of economic sanctions” as “naïve”. He held that the belief in the working of sanctions via domestic pressure against the leadership is simplistic since it ignores the possibility that sanctions can actually have the opposite effect – the value-deprivation as a result of sanctions may bring about political integration. This will happen if some of the following conditions are met: sanctions are seen as an attack on the whole community; the target does not identify with the sender; and individuals in the target state strongly believe in their own goals and values.158

Although he does not refer to it using these terms, Galtung described here what famously came to be known as the “rally-around-the-flag” effect. He shows in detail how the economic

156 Johan Galtung, “On the Effects of International Economic Sanctions: With Examples from the Case of Rhodesia”, World Politics, 19 No. 3 (1967).

157 Galtung, “On the Effects of International Economic Sanctions”, 387-388.

158 Galtung, “On the Effects of International Economic Sanctions”, 389. These conclusions were made on the basis of observations from the case of Rhodesia, where sanctions resulted in greater political integration supporting the racial regime of Ian Smith.

deprivation from sanctions only strengthened the resolve of the population to support their government. The “naïve” theory of sanctions is therefore considered to be faulty because it makes two assumptions – that there will be political disintegration proportionate to economic costs, and that the economic damage caused by sanctions cannot be counteracted.159

In addition, Galtung argues against the prevalent belief that universal sanctions are effective i.e. that the main cause of sanctions failure is that they are not imposed by all. He argues that the rally-around-the-flag effect is likely to be present even in cases of universal sanctions because the target is able to readjust itself economically or because the intense economic costs lead to strong moral outrage against the senders.160 These observations were deeply prescient in the context of the experience of UN sanctions on Iraq several years later.

Despite his strongly critical view of sanctions, Galtung actually presented a more nuanced understanding suggesting that the political impact of sanctions varies according to several factors. Most strikingly, he states in his conclusion “…nothing of what has been said should be taken to imply that there are no conditions under which economic sanctions will work.”161 He believed that sanctions are very effective in the domain of family and personal relations, where there is “a communality of interest”.162 Thus common or shared interests are a possible necessary condition for sanctions success. He also mentioned eight other influential factors, all relating to the economics of the sanctioned commodity and the nature of the target

159 Galtung, “On the Effects of International Economic Sanctions”, 390-391.

160 Galtung, “On the Effects of International Economic Sanctions”, 411.

161 Galtung, “On the Effects of International Economic Sanctions”, 410.

162 Galtung, “On the Effects of International Economic Sanctions”, 410.

economy.163 Hence, although later analysts point to Galtung’s vigorous assessment and conclusion that sanctions generally do not work, he does suggest that they may be successful under certain conditions.

An important limitation of Galtung’s work is that his conclusions are based on the analysis of a single case. Focusing on high-profile cases like the sanctions against Rhodesia and

South Africa may not yield generalizable results not only because they were rare instances of universal sanctions but also as they entailed conditions ripe for the operation of the rally- around-the-flag effect (such as a sense of unified external oppression). More important than the single-case basis of Galtung’s study is the limitation that he focused only on one mechanism by which sanctions can operate.164 He studied the standard pathway that scholars have often assumed to be the sole expected route by which sanctions may work – sanctions cause economic damage, which leads the suffering population to pressurize the regime to change its policies in accordance with the demands of the sender. However, this is only one of different possible routes to sanctions effectiveness as discussed later.165

One of the earliest full-length studies on sanctions was Margaret Doxey’s book published first in 1971. She argues that sanctions are not likely to bring the desired changes due

163Galtung holds that sanctions can be successful when: imports are very important to the target economy; there are no domestic substitutes for the imports; the imports mostly come from the sender(s); there are no external substitutes for the imports; the imports to the target are only a small fraction of the sender’s exports; exports of the target go mainly to the sender and there are no alternate trading partners; exports of the target are easily substitutable; trade relations can be effectively supervised such as when the target is an island or surrounded by difficult terrain. Galtung, “On the Effects of International Economic Sanctions”, 384.

164 Baldwin, Economic Statecraft, 136.

165 Crawford and Klotz delineate four possible mechanisms of resource denial, compellence, normative influence, and political fracture. Galtung’s ‘naïve’ theory refers to what Crawford and Klotz term as the “political fracture” mechanism; other possible routes are: resource denial, where sanctions deny the necessary resources to continue a particular policy; normative influence, where sanctions persuade leaders, elites, or populations about the moral correctness of abandoning current behavior; and compellence, where sanctions help alter the cost-benefit calculus of continuing a particular policy, thus persuading leaders to abandon it. Crawford and Klotz, How Economic Sanctions Work.

to problems of implementation as well as countermeasures that the target state can adopt.166

Doxey points out that sanctions are difficult to enforce because sender countries have different views on the urgency of sanctions imposition, varying relations with the target, and diverse costs to bear as a result of sanctions. Although UN sanctions on Rhodesia were mandatory (the first such required sanctions), they did not lead to the collapse of the Ian Smith regime principally because South Africa supplied oil to Rhodesia through swap arrangements.167 Doxey believes that sanctions will fail unless they are universal, but such multilateral sanctions are difficult to implement since countries generally disagree on means or ends, tend to differ on the need for sanctions, and vary in the extent of costs and risks they are willing to face.168

Furthermore, the reasons for sanctions imposition are likely to affect their success since those motivated by a mere desire to “do something” rather than actually seeking policy change are likely to be ineffective.169

Doxey held that sanctions also fail because of the range of target responses that can counter their effects. The target can adopt a number of measures such as stockpiling, developing alternate sources of supply, and seeking greater self-sufficiency;170 its economy can continue to grow -- for example, the Rhodesian economy grew under the effect of measures that were taken in response to sanctions;171 the target can obtain goods and services from countries not

166 Doxey, Economic Sanctions.

167 Doxey, Economic Sanctions, 89.

168 Doxey, Economic Sanctions, 89-90.

169 Doxey, Economic Sanctions; Margaret P. Doxey, International Sanctions in Contemporary Perspective (New York: St. Martin’s Press, 1996).

170 Doxey, Economic Sanctions, 108-109.

171 Doxey, Economic Sanctions, 112-113.

participating in the sanctions; there may be sanctions evasion; the target can impose counter- sanctions; the target regime can rally the public to its support through propaganda;172 and finally, the target can also persuade world public opinion against sanctions by highlighting the suffering of ordinary people.

Ultimately, Doxey believes that the success of sanctions depends on three broad sets of factors – the goals of the sender(s), the expected costs to the sender(s), and the vulnerability of the target.173 Her work is valuable in delineating the varying factors and mechanisms that could undermine the effectiveness of sanctions. Unlike Galtung who focused on target reactions,

Doxey explained sanctions failure with a range of factors -- sender motives, costs to the sender, and the costs and options for the target. But again, as in the case of Galtung’s analysis, the main drawback of Doxey’s work is the assumption of a single causal mechanism by which sanctions may operate.174

Other scholars like Knorr and Nincic and Wallensteen also argued that sanctions tend to be unsuccessful in realizing the desired ends. The main reasons for sanctions failure, as discussed by the first-wave scholars, are: rally-around-the-flag effect in the target, economic diversification by the target, and high costs to the sender.175 Several other factors can also influence the working of sanctions, but the literature does not offer a cohesive view of them.

Instead, scholars have put forth arguments in opposite directions regarding the impact of other factors. These are discussed later in this chapter.

172 Doxey, Economic Sanctions, 121.

173 Doxey, International Sanctions in Contemporary Perspective, 65.

174 Doxey also implicitly assumes that the only way sanctions can work is through the political fracture mechanism. Doxey, Economic Sanctions.

175 Knorr, Power of Nations, 152-154; Nincic and Wallensteen, “Economic Coercion” in Nincic and Wallensteen, Dilemmas of Economic Coercion. 61

Another important factor possibly affecting the working of sanctions is military force.

First-wave scholars tend to maintain that even where policy change and sanctions are correlated, success may in fact have been the result of security-related considerations rather than economic statecraft. Robert Pape holds that “The most common alternative explanations involve the use of force (including military conquest), coercion by the threat of overwhelming military force, and covert use of force, such as foreign-sponsored assassinations and coups.”176 In his view, much of what others consider sanctions successes are in fact cases of the influence of military force.

Similarly, Valentin Krustev believes that the oft-neglected military context of sanctions gives rise to the view that sanctions are more useful than they actually are.177 He argues that sanctions can be thwarted when the target has a military advantage, such as when North Korea successfully linked sanctions imposition to peace on the Korean peninsula. Krustev believes that sanctions can therefore be successful only where military threats are not credible.

Morgan and Schwebach also conclude that sanctions have generally not been effective although they can contribute limitedly to policy successes.178 They believe that outcomes tend to be determined by factors other than sanctions. However, sanctions can be effective when they impose major costs on the target, and especially when dominant interest groups are affected.

“Second Wave”: Sanctions sometimes work

The second wave theorists began arguing in the mid-1980s that sanctions are more useful than generally believed. They held that although sanctions may entail some costs, they are often

176 Pape, “Why Economic Sanctions”, 97.

177 Valentin L. Krustev, “Bargaining and Economic Coercion: The Use of Effectiveness of Sanctions” (PhD dissertation, Rice University, 2007).

178 Clifton T. Morgan and Valerie L. Schwebach, “Fools Suffer Gladly: The Use of Economic Sanctions in International Crises”, International Studies Quarterly, 41 No. 1 (1997).

the best option in cases where action is imperative, and that the costs involved are less compared to other methods such as military force. Thus, the reason for their positive appraisal of sanctions lay principally in the different yardstick for ‘success’ – unlike the First Wave theorists, these scholars did not focus exclusively on whether the target changed its policy in line with what was demanded, but rather on the relative costs and outcomes from sanctions.

M. S. Daoudi and M. S. Dajani made one of the earliest such arguments in support of sanctions, holding that they are useful because they help curtail the use of force.179 Daoudi and

Dajani maintain that in judging the utility of sanctions, one should not consider their contribution to changing target policies but rather their role in preventing war. They argue that sanctions successfully avert war through symbolic effects such as expressing morality and signifying disapproval, establishing the perception that sanctions harm the target, and upholding the sender’s reputation. In doing so, sanctions ultimately inflict “symbolic vengeance.”180

Despite their optimistic assessment, Daoudi and Dajani do not believe that sanctions can achieve major foreign policy aims such as dislodging a government.

A second major work seeking to restore the lost reputation of sanctions is David

Baldwin’s classic analysis of sanctions as the best policy option in several situations.181

Baldwin argues that the success of any instrument of statecraft can be assessed only by comparing the costs and benefits of alternative means to the same goal.182 He contends that this is the main mistake made by most first-wave scholars, since they considered the costs and benefits of sanctions separately from the likely costs and results from the use of diplomacy or

179 Daoudi and Dajani, Economic Sanctions.

180 Daoudi and Dajani, Economic Sanctions, 161.

181 Baldwin, Economic Statecraft.

182 Baldwin, Economic Statecraft, 118-130. 63

military force. Baldwin concludes that, like other tools, economic sanctions work best when used in conjunction with other policy instruments.183

The classic comprehensive analysis by Gary Hufbauer et al studied 116 sanctions cases.184 Providing short descriptions of each and conducting a statistical analysis, they conclude that sanctions are successful about 34 percent of the time. Hufbauer et al argue that the disparity between the scholarly view on sanctions failure and the policy reality that they have been used very widely (especially since the 1990s) is explained by two considerations – sanctions do sometimes work, and there are often no better alternatives.

Several authors on both sides of the sanctions divide have criticized Hufbauer et al.

Sanctions critic Robert Pape argues that only five cases (out of the forty claimed) were in fact instances of sanctions success.185 He believes that this is because almost half of the forty cases in reality displayed the successful threat or use of force rather than the role of sanctions.

Sanctions proponents fault Hufbauer et al primarily for selection bias in choosing only cases where sanctions were clearly threatened or imposed. They hold that in doing so, Hufbauer et al leave out numerous cases where sanctions were so powerful that they did not even need to be explicitly articulated or imposed, but the mere suggestion of sanctions led targets to comply.186

These criticisms bring to light the immense difficulties of studying sanctions. In particular, the contrasting conclusions drawn by Hufbauer et al and Pape on the very same cases very

183 Baldwin, Economic Statecraft. 143.

184 Hufbauer et al, Economic Sanctions Reconsidered.

185 Pape, “Why Economic Sanctions”.

186 Jon Hovi, Robert Huseby, and Detlef F. Sprinz, “When Do (Imposed) Economic Sanctions Work?”, World Politics, 57 No. 4 (2005).

powerfully depict the need for more in-depth studies that focus on the myriad social, political, and economic factors that may affect the impact of sanctions.

The data on sanctions compiled by Hufbauer et al spawned numerous studies. Daniel

Drezner developed what he termed the “conflict expectations model” of sanctions.187 Using formal modeling, statistical analysis, and case comparisons, Drezner concluded among other things that economic coercion is inversely related to the expectation of future conflict i.e. targets expecting to have further conflictual encounters with the sender will perceive greater costs and fewer benefits in capitulating to the current demand. Hence, one of Drezner’s major findings is the “paradox” that sanctions tend to be more successful when used against allies than adversaries. This is paradoxical in the additional sense that senders are less keen to impose sanctions against their allies. Hufbauer et al had also made similar conclusions.188 Drezner’s contribution lies in further explicating this hypothesis and in showing its operation in case studies involving Russia and the CIS states, as well as US coercion of North Korea.

Neta Crawford and Audie Klotz have argued that a wide range of sanctions covering the areas of trade, finance, oil, diplomacy, and sports contributed to the eventual decline of apartheid in South Africa.189 They nevertheless caution that sanctions may not be effective for all foreign policy goals such as attempting to reverse military aggression.190 In their second chapter they lay out a useful analytical framework delineating four possible mechanisms by which sanctions may operate: (i) Resource Denial, where sanctions reduce target capabilities to continue the sanctioned policy; (ii) Compellence, where sanctions increase the costs and/or

187 Drezner, Sanctions Paradox.

188 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., 163-165.

189 Crawford and Klotz, How Sanctions Work.

190 Crawford and Klotz, How Sanctions Work, 274. 65

reduce the benefits of continuing the policy, (iii) Normative Communication, where the target is convinced on the moral appropriateness of the sender’s position and it changes its policy accordingly; and (iv) Political Fracture, where sanctions lead to increased discontent among the target population, pressuring the regime to change its policy in order to end the sanctions.

For the purposes of the dissertation, the first mechanism, resource denial, is akin to the resource factor explanation for nuclear proliferation. All three other processes refer to factors beyond technical or financial capability; hence they fall into the motives category of factors affecting proliferation. These three remaining mechanisms refer to the intent to seek or give up nuclear weapons capability. What Crawford and Klotz refer to as “normative communication” is the prestige model in the proliferation literature – where leaders undertake nuclear pursuit or restraint according to the perceived normative benefits of doing so. Their “political fracture” process falls into the domestic politics model, and is the process that scholars like Galtung and

Doxey had in mind. Their “compellence” mechanism could entail factors in any of the three models.

Ultimately, ‘compellence’ or persuading leaders on the benefits of restraint is essentially the same as what the proliferation literature refers to as the demand-side or motives for restraint.

Lopez and Cortright indicate the operation of the compellence mechanism by arguing that sanctions “compelled” Iraq to accept the inspections regime.191 This method of sanctions effectiveness relies heavily on a “carrot-and-stick” approach where the ‘stick’ was sanctions and the principal ‘carrot’ was their termination if Iraq complied. They thus believe that:

191 George A. Lopez and David Cortright, “Containing Iraq: Sanctions Worked”, Foreign Affairs, 83 No. 4 (2004).

“Sanctions are best considered as instruments of coercive diplomacy to persuade decisionmakers in the target state to reassess the costs and benefits associated with policies that have attracted the ire of the international community.”192

Chan and Drury also view sanctions success as occurring through compellence, displaying

“linkage politics” where leverage in one issue area is used to extract concessions in another.193

Robert Eyler considers sanctions to be coercive tools for the purpose of achieving desired changes in the target’s policies.194 He believes that sanctions can achieve their goals by imposing costs on the target state, which forces it to alter its policies. Similarly, Drury acknowledges sanctions to be foreign policy tools for the purpose of undertaking coercive diplomacy.195

The broader notion of compellence draws heavily on Thomas Schelling’s classic work on coercion, which has spurred some work on coercive diplomacy. These concepts and their primary insights are discussed below, as they have important implications for understanding what affects the motives or cost-benefit calculus of decision-makers. Below I discuss

Schelling’s work as relevant to the dissertation.

Schelling’s ‘Compellence’

Thomas Schelling’s classic distinction between brute force and coercion is relevant here to the extent that it delineates the process by which a sender may persuade the target to comply.

192 David Cortright and George A. Lopez, The Sanctions Decade: Assessing UN Strategies in the 1990s (Boulder, Colorado: Lynne Reiner Publishers, 2000), 223.

193 Chan and Drury, Sanctions as Economic Statecraft.

194 Robert Eyler, Economic Sanctions: International Policy and Political Economy at Work (New York: Palgrave Macmillan, 2007).

195 Drury, A. Cooper, “How and Whom the US President Sanctions: A Time-series Cross-section Analysis of US Sanction Decisions and Characteristics”, in Chan and Drury, Sanctions as Economic Statecraft.

Schelling argues that the more powerful and fascinating use of military force is its bargaining power rather than its impact through brute force.196 Such bargaining is based on an intrinsic possibility of violence if the target does not comply, and the withholding of harm if the target concedes.197 He calls the use of this bargaining power “coercive diplomacy.”198 Hence unlike brute force, coercive diplomacy is based on the power to hurt.

Schelling’s idea of ‘brute force’ involves no cooperation from the enemy as it simply metes out physical damage.199 Thus this effect depends wholly on the relative strength of military force between the two sides and has no connection to the target’s values or preferences.200

Coercion, on the other hand, involves convincing the other party to act according to the sender’s wishes. Such coaxing or persuasion can be accomplished only if the sender is aware of what the target values.201 It greatly depends on the target’s motivation to avoid suffering.202 Unlike brute force, coercion is bargaining where both the sender and the target seek better outcomes even if not their ideal.203 This means that coercion cannot be achieved if the interests of the two parties are totally opposed to one another.204 Another important characteristic of coercion is that it is

196 Thomas C. Schelling, Arms and Influence (New Haven: Yale University Press, 1966).

197 Schelling does not use the terms “sender” and “target” but I employ them in describing his findings and extrapolating them to our understanding of sanctions. Schelling, Arms and Influence, 2-4.

198 Schelling, Arms and Influence (1966), 3.

199 Thomas C. Schelling, Arms and Influence (New Haven: Yale University Press, 2008), 8.

200 Schelling, Arms and Influence (2008), 2-3.

201 Schelling, Arms and Influence (2008), 3.

202 Schelling, Arms and Influence (2008), 2.

203 Schelling, Arms and Influence (2008), 1.

204 Schelling, Arms and Influence (2008), 4.

most effective when held in reserve205 i.e. the threat of punishment tends to work better than its actual imposition. This is because it entails the expectation of more damage to come or “latent violence”, thus potentially affecting the target’s decision calculus. Finally, coercion must entail assurances to the target that suffering can be avoided if it complies with the demand.206 Without such assurances the target may not perceive it has a choice.

The key differences between brute force and coercion are: (i) brute force depends on the target’s strength, while coercion exploits its wants and fears; (ii) brute force succeeds when it is used, while coercion works best when held in reserve;207 and (iii) brute force succeeds irrespective of what the target’s interests are, while coercion can work only when the interests of the two sides are not completely opposed.208

For the purpose of studying nuclear restraint, the brute force route is the process by which a country’s nuclear program may slow down or end due to financial and technical limitations.

Here restraint occurs irrespective of a regime’s desire to sustain the nuclear program. The success of brute force, then, depends wholly on the ability to deny required resources.

Compellence, however, depends on two cost-related factors – whether the demand of the target is less costly to it than the punishment, and whether it is conveyed in a manner that does not jeopardize the target’s reputation and prestige. As Schelling observes, these conditions are almost never satisfied in international relations although they are sometimes attained in domestic politics.209

205 Schelling, Arms and Influence (2008), 3.

206 Schelling, Arms and Influence (2008), 4, 74.

207 Schelling, Arms and Influence (2008), 3.

208 Schelling, Arms and Influence (2008), 4.

209 Schelling, Arms and Influence (1966), 89. 69

The distinction between brute force and coercion corresponds directly to the resources versus motives divide highlighted by the proliferation literature. Schelling’s work is helpful for analytically distinguishing these two sides to proliferation. The proliferation literature points out that resources alone (technology imperative thesis) are insufficient to explain a country’s move to acquire nuclear weapons. Instead, leaders must be motivated toward weaponization.

However, in the case of restraint, it is seen that either resources or motives alone can be sufficient to restrain a nuclear weapons program. In the dissertation, I show how Iraq’s nuclear rollback occurred largely through resource constraints alone; while Taiwan’s nuclear restraint was almost entirely due to motivational factors.

Building on Schelling’s work, Alexander George developed the concept of coercive diplomacy as a strategy of coercion based on threats and inducements. It is what Schelling called “compellence”, seeking to persuade the target to stop short of its goal, to undo its actions, or even to change the target regime.210 George also emphasizes the distinction between capability and intention, arguing that coercive diplomacy focuses on affecting the opponent’s will rather than its capabilities.211 Two factors that greatly affect the success of coercive diplomacy are the nature of what is demanded and the target’s disinclination to comply.212

Sanctions and Nuclear Proliferation

210 Alexander L. George, “Coercive Diplomacy: Definition and Characteristics. Theory and Practice” in Alexander L. George and William E. Simons, eds., The Limits of Coercive Diplomacy (Boulder: Westivew Press, 1994).

211 Alexander L. George, “The Development of Doctrine and Strategy, Comparisons and Lessons” in Alexander L. George, David K. Hall, and William E. Simons, eds., The Limits of Coercive Diplomacy: Laos, Cuba, Vietnam (Boston: Little Brown Company, 1971), 18.

212 George, “Developments of Doctrine and Strategy”, 22-24.

An important piece of scholarship presenting a more neutral position on the role of sanctions is Meghan O’Sullivan’s book entitled Shrewd Sanctions.213 Quite unlike the majority of the literature, which is more easily divided into the first or second wave positions, O’Sullivan neither overwhelmingly rejects nor wholeheartedly embraces sanctions as a valuable foreign policy tool. She studies the impact of sanctions in achieving the US goals of ending targets’ support to terrorism and the pursuit of weapons of mass destruction, presenting detailed case- studies of Iran, Iraq, Libya, and Sudan.

The key point highlighted by O’Sullivan is that the common delineation of sanctions as

“successes” or “failures” is too simplistic. She argues that the outcome is a function of a multitude of factors and that the usefulness of sanctions greatly depends on how we use them rather than their innate abilities. Ultimately, sanctions will work if they are used shrewdly. Such a careful application of sanctions can be obtained if the structure of the sanctions regime is appropriately set up, and if other policy tools are also used (O’Sullivan 2003, 287-288).214 This means that sanctions must be suitably designed to specific goals and that other tools should not be abandoned.

Of the three categories of goals that she considers, O’Sullivan believes that seeking policy change by the target is one of the most difficult to achieve (the other two are containing the target regime and changing the target regime). She maintains that the best way to attain this goal is through a bargaining framework very much akin to the compellence mechanism delineated by Crawford and Klotz.215 For O’Sullivan, this would entail dialogue, flexibility,

213 O’Sullivan, Shrewd Sanctions.

214 O’Sullivan, Shrewd Sanctions, 287-288.

215 Crawford and Klotz, How Sanctions Work.

incremental application, and encouragement.216 For the goal of containing the target government, she advocates the resource denial or normative communication mechanisms although she does not use these terms.217 And finally, the objective of regime change can be brought about through resource denial or political fracture.218 O’Sullivan thus perceptively argues not only that the sanctions effort should be determined by the desired objectives, but also shows how various factors will affect the working of sanctions differently depending on the goals. For example, multilateral sanctions are crucial for the purpose of containing a government, but are not as necessary for regime change.

O’Sullivan also makes a major contribution in delineating the concepts of impact, effectiveness, utility, and comparative utility in the context of sanctions. “Impact” refers to the actual economic and political damage to the target; “effectiveness” is the degree to which sanctions attain the desired objectives; “utility” is the cost-benefit tabulation for sanctions in achieving goals; and “comparative utility” means the utility of sanctions relative to the utility of other policy instruments.219 Thus she echoes Baldwin’s observation that “it is quite possible for sanctions to be more useful than force even in situations in which they are less effective.”220

In this dissertation, I consider the impact and effectiveness of sanctions in each case study. The concepts of utility and comparative utility are less relevant for this study since it is limited to assessing the role of sanctions in achieving nuclear restraint, quite separately from the costs that may be involved. It must therefore be cautioned that since this research focuses solely

216 O’Sullivan, Shrewd Sanctions, 288.

217 O’Sullivan, Shrewd Sanctions, 289.

218 O’Sullivan, Shrewd Sanctions, 290-291.

219 O’Sullivan, Shrewd Sanctions, 27-30.

220 Baldwin, Economic Statecraft, 194. 72

on the contributory role of sanctions to one policy objective, its conclusions cannot be extrapolated to an overall assessment of sanctions utility or the trade-offs in goals that might be involved.

O’Sullivan believes that the prevalent failure of sanctions to act as a powerful policy instrument can be traced to four factors.221 First, strategic thinking is often absent in the application of sanctions, so that the emergence of new goals does not usually result in a re- evaluation of the sanctions structure -- it is normally difficult to reduce sanctions if the most publicized objectives are not realized. Second, the process of deciding and enforcing sanctions is diffuse, involving numerous state and inter-state actors. This is further complicated by domestic processes of decision-making, such as tussles between the legislature and the executive. Third, the objectives are often unclear, complex, and competing. Fourth, the goals tend to change over time.

A recent volume specifically addresses the impact of sanctions as well as positive inducements on nuclear proliferation, making an important contribution to the literature. It is edited by Etel Solingen and focuses on the “domestic distributional consequences” of sanctions.222 Solingen points out that sanctions may be more effective than commonly realized, since the very fear of sanctions may dissuade states from nuclear proliferation.223 The book seeks to overcome the “excessive reliance on the assumption that states are coherent actors” by emphasizing that a range of causal mechanisms affect decision-making. National decisions are taken in the domestic political context, and therefore decisions on nuclear restraint depend

221 O’Sullivan, Shrewd Sanctions, 295-299.

222 Solingen, ed., Sanctions, Statecraft, and Nuclear Proliferation.

223 Solingen, “Introduction: the domestic distributional effects of sanctions and positive inducements” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 8.

greatly on “who gains” and “who loses” from such decisions.224 Solingen lists four key factors that determine the sanctions effect on nuclear decisions: (i) whether leaders are inward-looking or internationalizing, (ii) regime type, (iii) timing and the stage of the nuclear program, and (iv) whether the sanctions/positive inducements are targeted or comprehensive.225 According to her, nuclear restraint is more likely with liberalizing and internationalizing regimes, democracies, and when “nuclear programs have not yet yielded nuclear weapons.”226 She believes that multilateral sanctions tend to be more effective than unilateral ones.227 She implies that the impact of comprehensive versus targeted sanctions is inconclusive as it depends on other factors.228

Individual theoretical chapters in the book help illuminate the complexity of sanctions theorizing. Arthur Stein observes that sanctions increase the state power of the target as it readjusts the economy to the sanctions.229 He notes that the pain inflicted by sanctions is felt more by those sectors that are open to the international economy. Ironically, these often tend to be the regime’s opponents.230 Ultimately, it is seen that the economic effects of sanctions are uncertain; however, even if they inflict economic damage, this may not translate into political changes.231

224 Solingen, “Introduction” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 10-11.

225 Solingen, “Introduction” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 11-20.

226 Solingen, “Introduction” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 18.

227 Solingen, “Introduction” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 5.

228 Solingen, “Introduction” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 19-20.

229 Arthur Stein, “Sanctions, inducements, and market power: political economy of international influence” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 45.

230 Stein, “Sanctions, inducements” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 43, 47.

231 Stein, “Sanctions, inducements” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 47 74

In the same volume, Reynolds and Tan provide a detailed listing of all recent sanctions on Iraq, Libya, Iran, and North Korea. They point out that these sanctions were initially not aimed at bringing about nuclear restraint.232 Bemoaning the “demonstrated failures of coercive pressures”, Miroslav Nincic suggests that positive inducements are more likely to be successful.

He believes that positive inducements can have this effect because they don’t threaten regime survival, which is the ultimate aim of the target regime.233 Daniel Drezner examines the working of “smart sanctions”, a concept that emerged in the 1990s in response to the sanctions-induced humanitarian crisis in Iraq.234 Smart or targeted sanctions refer to those aimed at particular sections of a country, especially its leadership, in order to concentrate economic damage on decision-makers while reducing the harm to the populace. Drezner seeks to understand why smart sanctions appear to have largely failed. He concludes that this is because they rely on only one, simple causal mechanism, expecting that leaders will change their policies in order to minimize the costs from sanctions. In reality, sanctions can work through a number of causal mechanisms including resource denial, normative changes, triggering popular unrest, and signaling military threats.235 Smart sanctions have tended to be ineffective because their impact is narrowly focused.236 This, however, does make smart sanctions more humane.237

232 Celia L. Reynolds and Wilfred T. Tan, “Empirical trends in sanctions and positive inducements in proliferation” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 84.

233 Miroslav Nincic, “Positive incentives, positive results? Rethinking US counterproliferation policy” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 126.

234 Daniel Drezner, “An analytically eclectic approach to sanctions and nonproliferation” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation.

235 Drezner, “An analytically eclectic approach” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 164.

236 Drezner, “An analytically eclectic approach” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 155.

237 Drezner, “An analytically eclectic approach” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 159.

The final theoretical chapter in the book examines the domestic distributional effects of military threats. Kreps and Pasha hold that military threats strengthen the domestic coalitions that oppose internationalization.238 Therefore, military threats undermine the chances of nuclear restraint. According to them, the process by which this happens is that military threats lead to increased spending on the military-industrial complex, as well as declining trade and investment freedom.239 They believe that both these developments are associated with a move to nuclear pursuit.

This edited book performs a valuable role in offering the first detailed analysis of the sanctions impact on nuclear proliferation. It will therefore be an important referring source for scholars and policy-makers. However, it does not offer a cohesive argument or theory on the way in which sanctions might affect nuclear programs. Instead, it points to the multitude of factors that might affect decision-making following sanctions or inducements. A central problem with the book is the underlying bias on the intransigence of so-called “inward-looking” regimes such as Iran and North Korea. In fact, the vast majority of the chapters are concerned with coercing one or more of the “problem” states of Iran, North Korea, Iraq, and Libya. By doing this, the analysis tends to overlook two factors – first, it frequently overlooks the motives for nuclear programs in these countries, such as their security threat perceptions; second, the analysis seems to forget that it is narrowly focusing on Western coercion of states that are regarded as hostile. For example, Nincic’s observation that coercion has largely failed240

238 Sarah Kreps and Zain Pasha, “Threats for peace? The domestic distribution effects of military threats” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 175.

239 Kreps and Pasha, “Threats for peace?” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 186-187.

240 Nincic, “Positive incentives” in Solingen, Sanctions Statecraft, and Nuclear Proliferation, 126.

actually holds only with regards to adversaries rather than allies. As previous work has shown,241 coercion does tend to fail when used against adversaries.

Also, by unduly focusing on the “internationalizing” character of regimes as an explanatory variable, the analysis tends to overlook the fact that leaders need not be wedded to either internationalizing or inward-looking models. As Solingen points out, the adoption of international-liberalizing or inward state-oriented models is guided by the purpose of regime survival.242 Hence, leaders can be flexible in their choice of strategy if they believe it helps preserve survival. Although Solingen points to such factors in her earlier work,243 other authors in the book do not always keenly show this nuance. Ultimately, this seems to generate the view that leaders are schizophrenic when they try to have their cake and eat it too i.e. when they attempt to avoid sanctions while at the same time engaging in nuclear pursuit. Thus a fundamental issue is that internationalizing and nuclear pursuit are not mutually incompatible, especially if the target succeeds in conducting nuclear activities secretly.

A number of other issues with the book suggest the need for a deeper analysis of how sanctions may affect nuclear programs. For example, Drezner perceptively argues that there are several possible mechanisms by which sanctions may restrain nuclear programs.244 He holds that smart sanctions have failed because they have relied on only one mechanism – sanctions harm elites, who decide to undertake nuclear restraint. However, this begs the question as to why that mechanism did not work. For sanctions to restrain nuclear programs, one successful mechanism would be sufficient. Hence the question becomes why smart sanctions have not

241 Drezner, Sanctions Paradox.

242 Solingen, “Introduction”, in Solingen, Sanctions Statecraft, and Nuclear Proliferation, 12.

243 Solingen, Nuclear Logics.

244 Drezner, “An analytically eclectic approach” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation. 77

persuaded leaders to take restraint – is it that smart sanctions tend to inflict limited economic and political costs on elites? Can they be restructured to make them more costly?

Kreps and Pasha have argued that military threats tend to reinforce inward-looking coalitions, who tend to engage in nuclear pursuit.245 However, they overlook the fact that leaders could respond to military threats with greater political or economic engagement with the world, such as in seeking allies. In fact, they could respond with economic liberalization, and then use any additional resources gained in this way for nuclear pursuit. It is possible that the causal link between military threats and nuclear pursuit has little to do with the nature of the domestic coalition, and is simply a response to external threats.

Other Sanctions Hypotheses

Several other works present numerous hypotheses on the conditions required for the working of sanctions. These range across a number of variables such as the characteristics of sanctions – whether multilateral, how long they are imposed, how long it takes to impose them, etc; factors relating to the sender – the costs to the sender, domestic pressures for sanctions, etc.; and the nature of the target – whether democratic, whether an ally of the sender, etc. The striking observation when combining the insights from such existing works on sanctions is that they tend to disagree. There are contradictory propositions on almost all these variables. Below I offer an overview of these main contradictory conclusions from the literature as discussed in both the first-wave and second-wave scholarship.

Scholars have studied the likely impact of different factors on the working of sanctions.

These hypotheses are classified into three categories here – the nature of sanctions, characteristics of the sender, and target-related aspects. The arguments are summarized below in

245 Kreps and Pasha, “Threats for peace?” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation. 78

three separate tables. In the final analysis, the scholarship is completely at odds on the importance of these factors as well as the likely direction of their effect. Since the existing literature offers opposing arguments for almost every variable, one cannot definitively conclude on the expected impact of these sanctions characteristics on nuclear restraint.

Table 2.1 Varying hypotheses on characteristics of sanctions

Variable Hypothesis Authors (1) Nature of Sanctions less successful Knorr 1975; Wallensteen 1983; Daoudi and demand for major policy changes Dajani 1983; Baldwin 1985; Hufbauer et al 1990; Eland 1995;a Cortright and Lopez 1995, 2000;b Chan and Drury 2000; Major 2004;c Whang 2007d (2) Time Quickly implemented Doxey 1980; Hufbauer et al 1990; Bergeijk taken to sanctions are more 1994, 26;f Haass 1997;g Chan 2000;h Schwebach enforce successfule 2000i sanctions Slowly implemented Wallensteen 1983; Cortright and Lopez 2000 sanctions are more successfula

a Ivan Eland, “Economic Sanctions as Tools of Foreign Policy” in Cortright and Lopez, Economic Sanctions. b David Cortright and George A. Lopez, c Solomon Major, “The Domestic Politics of International Economic Sanctions” (PhD dissertation, Stanford University, 2004). d Taehee Whang, “Unifying Theory and Testing of Economic Sanctions Outcomes” (PhD Dissertation, University of Rochester, 2007). e It is hypothesized that this gives the target little advanced notice, which would have allowed it to adjust its economy to meet the costs imposed by sanctions, The Sanctions Decade: Assessing UN Strategies in the 1990s (Boulder: Colorado, Lynne Rienner Publishers, 2000). f Peter A. G. van Bergeijk, Economic Diplomacy, Trade, and Commercial Policy: Positive and Negative Sanctions in a New World Order (Edward Elgar Publishing Limited, 1994). g Richard N. Haass, “Sanctioning Madness”, Foreign Affairs, 76 No. 6 (1997). h Steve Chan, “Economic Sanctions: The US Debate on MFN Status for China” in Chan and Drury, Sanctions as Economic Statecraft. i Valerie L. Schwebach, “Sanctions as Signals: A Line in the Sand or a Lack of Resolve?” in Chan and Drury, Sanctions as Economic Statecraft.

(3) Duration Short sanctions more Hufbauer et al 1990; Dashti-Gibson et al 1997;c of sanctions successfulb Bergeijk 1994; Bolks and Al-Sowayel 2000d

Long sanctions more Daoudi and Dajani 1983; Eaton and Engers successfule 1999;f Lopez and Cortright 1995 – sanctions need at least 3 years to be successful.g (4) Type of Comprehensive, extensive Cortright and Lopez 2002;h Drezner 2012 sanctions sanctions more successful

Comprehensive sanctions Kaempfer and Lowenberg 1992; Rowe 2001i less successful than few, targeted sanctions

Uncertain Solingen 2012 Trade versus Trade sanctions more Cortright and Lopez 1995 financial successful in short term; sanctions financial sanctions more successful in long term

Financial sanctions more Hufbauer et al 1990; Dashti-Gibson et al 1997; successful than trade Kirshner 1995 – monetary sanctions are the most effective;a Eyler 2007

a The logic of this proposition is that the sender can bargain better if sanctions are calibrated according to target behavior. b It is believed that short sanctions do not give the target sufficient time to undertake successful economic diversification strategies or develop domestic political support. c Jaleh Dashti-Gibson, Patricia Davis, and Benjamin Radcliffe, “On the Determinants of the Success of Economic Sanctions: An Empirical Analysis”, American Journal of Political Science, 41 No. 2 (1997). d Sean M. Bolks and Dina Al-Sowayel, “How Long Do Economic Sanctions Last? Examining the Sanctioning Process through Duration”, Political Research Quarterly. 53 No. 2 (2000). e Scholars of this view hold that longer time periods are required for the impact of sanctions to take effect or seriously damage domestic economic and political life. f Jonathan Eaton and Maxim Engers, “Sanctions: Some Simple Analytics”, American Economic Review, 89 No. 2 (1999). g George A. Lopez and David Cortright, “Economic Sanctions in Contemporary Global Relations” in Cortright and Lopez, Economic Sanctions. h David Cortright and George A. Lopez, eds., Smart Sanctions: Targeting Economic Statecraft (Rowman & Littlefield Publishers, Inc., 2002). i David M. Rowe, Manipulating the Market: Understanding Economic Sanctions, Institutional Change, and the Political Unity of White Rhodesia (Ann Arbor: University of Michigan Press, 2001).

Embargoes more Hufbauer et al 1990 successful than boycottsb (5) Threat or Threat is more Knorr 1975; Daoudi and Dajani 1983 (it won’t actual successful than work with adversaries who will perceive imposition imposition greater losses); Chan 2000 (says threat is as of sanctions effective as imposition, not necessarily more); Bergeijk 1994; Hovi et al 2005

Imposition more Eaton and Engers 1999; Cortright and Lopez successful than mere 1995 (imply this argument). threat

(6) Whether Yes Wallensteen 1983; Baldwin 1985; Cortright work better and Lopez 2000; O’Sullivan 2003; Major with other 2004c policy instruments No; other policy Pape 1997 instruments are the ones that actually do the work

(7) Multilateral more Doxey 1980, 1996; Daoudi and Dajani 1983; Unilateral or successful Martin 1992;d Preeg 1999;e Drezner 2000a;f multilateral Nooruddin 2002;g Askari et al 2003;a Eyler sanctions 2007; Solingen 2012 a Jonathan Kirshner, Currency and Coercion: The Political Economy of International Monetary Power (Princeton: Princeton University Press, 1995). b Embargoes are restrictions on imports into the target, while boycotts are the prohibition of exports from the target to the sender. c The second-wave authors who believe that sanctions are sometimes successful generally hold that they work best as part of a larger strategy involving some incentives or carrots. d Lisa L. Martin, Coercive Cooperation: Explaining Multilateral Economic Sanctions (Princeton: Princeton University Press, 1992). e Ernest H. Preeg, Feeling Good or Doing Good with Sanctions: Unilateral Economic Sanctions and the US National Interest (Washington, DC: Center for Strategic and Intelligence Studies, 1999). f Daniel W. Drezner, “The Complex Causation of Sanction Outcomes” in Chan and Drury, Sanctions as Economic Statecraft. g Irfan Nooruddin, “Modeling Selection Bias in Studies of Sanctions Efficacy”, International Interactions, 28 No. 1 (2002).

Multilateral less Hufbauer et al 1990 successfulb

No difference in success Bergeijk 1994; Jing et al 2003 rates of the two

a Hossein G. Askari et al, Economic Sanctions: Explaining their Philosophy and Efficacy (Westport, Connecticut: Praeger, 2003). b Hufbauer et al hold that sanctions are more successful when they are unilateral. Although multilateral sanctions are theoretically more effective, the empirical data does not support this observation as multilateral sanctions involve coordination efforts among senders which is often difficult to achieve. Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed.

Table 2.2 Varying hypotheses on characteristics of the sender

Variable Hypothesis Authors (1) Size Bigger, wealthier senders have more Hirschman 1945; Knorr 1975; and success Wallensteen 1980; Daoudi and wealth of Dajani 1983; Cortright and Lopez sender 1995, 2000; Davis and Engerman 2003

Uncertain relation Hufbauer et al 1990a

Larger senders less successful Krustev 2007b; Jing et al 2003c (2) It matters greatly – symbolic goals less Doxey 1980, 1996; Kaempfer and Sender successful than instrumental onesd Lowenberg 1988, 2000 motives Symbolic goals more successful than Barber 1979; Lindsay 1986; goals of compliance/deterrencee Dashti-Gibson et al 1997

Irrelevant Wallensteen 1983

(3) Costs Costly sanctions less successful Knorr 1975; Daoudi and Dajani to the 1983; Nincic and Wallensteen sender 1983; Hufbauer et al 1990; Cortright and Lopez 1995; Doxey 1996; Eaton and Engers 1999; Drezner 2000; Kaempfer and Lowenberg 2000; Nooruddin 2002; Davis and Engerman 2003; aThey hold that it is difficult to predict the relation between sender size and sanctions success because empirically, senders have tended to be much larger. Hufbauer et al, Economic Sanctions Reconsidered. b Krustev believes that this is because larger senders tend to demand more. Krustev, “Bargaining and Economic Coercion”. c They maintain that the sender is seen as bulling a small target. Chao Jing, William H. Kaempfer and Anton D. Lowenberg, “Instrument Choice and the Effectiveness of International Economic Sanctions: A Simultaneous Equations Approach”, Journal of Peace Research, 40 No. 5 (2003). d These authors believe that this is because the sender is motivated simply by the desire to “do something” rather than actually seeking policy change in the target. e They argue that sanctions work through shaming techniques such as isolation and ostracism.

Eyler 2007

Costly sanctions more successfula Martin 1992; Schwebach 2000; Chan 2000

Irrelevant when Baldwin 1985 compared with costs to target (4) Democratic senders Hart 2000 Regime more successful type of b sender Democratic senders Stein 2012 may be less successful

Table 2.3 Varying hypotheses on characteristics of the target

Variable Hypothesis Authors (1) Extent of Sanctions successful Doxey 1980; Davis and Engerman 2003; economic when damage is Marinov 2005; Dashti-Gibson et al 1997; damage to more Lindsay 1986; Cortright and Lopez 2000 target Success does not Baldwin 1985; Lindsay 1986; Hufbauer et al depend on extent of 1990; Drezner 2000a; Jing et al 2003; economic damagec Kaempfer and Lowenberg 1992, 2000

a These scholars hold that costly sanctions are effective by signaling the sender’s strength of resolve. b Stein argues that democracies may be weak states (relative to society); they may have less market power, and therefore be less able to squeeze the target economically. Stein, “Sanctions, inducements” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation. c This is because success can come from shaming or isolation; sanctions work more through political than economic factors. For Kaempfer and Lowenberg, success depends on targeting influential interest groups rather than the whole economy. William H. Kaempfer and Anton D. Lowenberg, International Economic Sanctions: A Public Choice Perspective (Westview Press, 1992); William H. Kaempfer and Anton D. Lowenberg, “A Public Choice Analysis of the Political Economy of International Sanctions” in Chan and Drury, Sanctions as Economic Statecraft.

Milder sanctions Rowe 2001a more successful Extent of damage may itself depend on (a) and (b) as well as (2), (3), and (4) (a) Overall Success with weaker Wallensteen 1983; Doxey 1996; Jing et al 2003; economic targets Hufbauer et al 1990 health of target

(b) Relative Sanctions more Knorr 1975; Cortright and Lopez 2000; Davidson trade between successful when and Shambaugh 2000 sender and target and sender target trade a lot Trade dependence is Whang 2007b irrelevant

(2) Strength of Sanctions less Wallensteen 1983; Sylvan 1983; Hufbauer et al target regime successful with 1990; Bergeijk 1994; Dashti-Gibson et al 1997; stronger targets Kaempfer and Lowenberg 2000; Drezner 2000a; Stein 2012

(3) Rally- Sanctions less Galtung 1967; Daoudi and Dajani 1983; Nincic around-the- successful when and Wallensteen 1983; Hufbauer et al 1990 flag effect effect is strong Sanctions can work Baldwin 1985; Klotz 1999 despite this effectc

(4) Economic Makes sanctions Hirschman 1945; Knorr 1975; Doxey 1980, diversification less successful 1996; Nincic and Wallensteen 1983; Green 1983d by target

a Rowe argues that sanctions can bring more internal unity, with domestic groups becoming more dependent on the government so that they are less likely to pressure for change. David M. Rowe, Manipulating the Market: Understanding Economic Sanctions, Institutional Change, and the Political Unity of White Rhodesia (Ann Arbor: University of Michigan Press, 2001). b Whang found no statistical significance of trade dependence on the outcome of sanctions. Taehee Whang, “Unifying Theory and Testing of Economic Sanctions Outcomes” (PhD Dissertation, University of Rochester, 2007). c Sanctions can work through other factors such as generating shame/isolation and economic difficulties, thus being effective even in the presence of a strong rally-around-the-flag effect. d Jerrold D. Green, “Strategies for Evading Economic Sanctions” in Nincic and Wallensteen, Dilemmas of Economic Coercion.

Third county Jing et al 2003a assistance is irrelevant for sanctions success

(5) Prior Sanctions more Hufbauer et al 1990; Drezner 1999; Nooruddin relationship successful against 2002; Jing et al 2003; Eyler 2007; Whang 2007 with sender allies

(6) Type of Sanctions more Cortright and Lopez 1995; Nooruddin 2002; target regime successful against Marinov 2005;b Solingen 2012 democratic targets

a Jing et al make the empirical finding that third-country assistance does not affect the success of sanctions. Jing et al, “Instrument Choice”. b Nikolay Marinov, “Do Economic Sanctions Destabilize Country Leaders?”, American Journal of Political Science, 49 No. 3 (2005).

Conclusion: Conflicting Hypotheses in the Sanctions Literature

The discussion above has highlighted the conflicting propositions on numerous factors that may affect the working of sanctions. One source of difference among authors’ positions on the role of these variables is their overall orientation – whether they are first- or second- wave scholars. To those who are critical of the effectiveness of sanctions, these variables help explain why they do not work. For example, Doxey believes that sanctions must be multilateral in order to be successful, but such international cooperation on sanctions implementation is rarely achieved.1 However, differences remain among scholars within the same school of thought, so that while second-wave authors like Daoudi and Dajani, and Drezner believe multilateral sanctions are more likely to bring the desired changes, other second wave scholars like

Hufbauer et al maintain that unilateral sanctions have empirically tended to be more successful, while another category of second wave writers like Bergeijk and Jing et al hold that the number of senders is irrelevant for sanctions success.2

With regard to the type of target regime, scholars have generally agreed that sanctions are more successful against democratic states. Risa Brooks has offered a more nuanced argument by holding that sanctions success depends on the type of sanctions as well as the regime type.

According to Brooks, the most successful sanctions against democratic targets are comprehensive sanctions or those that hurt powerful groups; the corresponding sanctions for authoritarian regimes are those that hurt pivotal constituencies.3

1 Doxey, Economic Sanctions.

2 Bergeijk, Economic Diplomacy; Daoudi and Dajani, Economic Sanctions; Drezner; Sanctions Paradox; Hufbauer et al, Economic Sanctions Reconsidered; Jing et al, “Instrument Choice”.

3 Risa Brooks, “Sanctions and Regime Type: What Works, and When?”, Security Studies, 11 No. 4 (2002).

Apart from their orientation as first or second wave scholars, another source of variation within the sanctions literature is the methodology adopted. The bulk of the literature employs the case study method, and thus the conclusions differ according to the cases selected. A common criticism is that the early literature selected high-profile cases of sanctions failure such as the 1930s sanctions by the League of Nations on Japan for the invasion of Manchuria and

Italy for the attack on Ethiopia, or the US grain embargo on the Soviet Union after its invasion of Afghanistan. Scholars like Doxey, Knorr (1975), Nincic and Wallensteen (1983) tended to base their conclusions on several short case summaries.4 Baldwin also used ample anecdotal evidence, but his analysis is more heavily based on conceptual reasoning.5 Hufbauer et al conducted regression analysis on a massive data that they compiled, which remains the most comprehensive collection of sanctions cases today.6 Later work such as Drezner and Krustev use game theory or formal modeling to analyze the impact of sanctions, while Drezner also conducts case studies.7 Still others have employed insights from economics, using the public choice theory.8 They look at the role of domestic groups in critically affecting the decision- making in both the sender and the target. The conclusions these authors draw are affected by their methodology and the broad scope of their analysis – whether they offer detailed case comparisons or present a more sweeping view of the overall statistics of sanctions impact.

4 Doxey, Economic Sanctions; Knorr, Power of Nations; NIncic and Wallensteen, Economic Coercion.

5 Baldwin, Economic Statecraft.

6 Hufbauer et al, Economic Sanctions Reconsidered.

7 Drezner, Sanctions Paradox; Krustev, “Bargaining and Economic Coercion”.

8 Eaton and Engers, “Sanctions: Some Simple Analytics”; Jing et al; Major, “Instrument Choice”; Kaempfer and Lowenberg, International Economic Sanctions; Kaempfer and Lowenberg, “Public Choice Analysis”; Major, “Domestic Politics of International Economic Sanctions”.

Ultimately however, the primary reason for the opposing arguments by the literature lies in the assumptions of each analyst as to the causal paths generated by economic sanctions.

Scholars have implicitly tended to assume that a particular mechanism is the only route by which sanctions may affect the final outcome. In the early to mid-twentieth century, the prevalent understanding was that sanctions may work according to the “naïve theory of economic sanctions”, which Crawford and Klotz have termed as the political fracture mechanism.9 According to this, sanctions cause economic suffering to the population, which then pressures the regime to adopt the necessary changes in order to terminate the sanctions.

Among the authors that tend to assume political fracture to be the only route to sanctions success are Galtung, Doxey, Green, Sylvan, Rowe, Marinov, and Stein.10

A few others focus on the sender’s coercion of the target, whereby the target changes its policy due to increasing political costs from factors besides domestic politics. Wallensteen11 and

Lindsay12 suggest the possibility of this process. Knorr appears to assume compellence to be the only mechanism by which sanctions may work.13 Chan and Drury also emphasize the bargaining function of sanctions through “linkage politics” where leverage in one issue is used

9 Galtung, “On the Effects of International Economic Sanctions”; Crawford and Klotz, How Sanctions Work.

10 Doxey, Economic Sanctions; Galtung, “On the Effects of International Economic Sanctions”; Green, “Strategies for Evading Economic Sanctions”; Marinov, “Do Economic Sanctions Destabilize Country Leaders?”; Rowe, “Economic Sanctions”; Stein, “Sanctions, inducements”; David Sylvan, “Ideology and the Concept of Economic Security” in Nincic and Wallensteen, Dilemmas of Economic Coercion.

11 Wallensteen believes that sanctions work better when both the demand and the target size are small. He also emphasizes that sanctions imposed gradually are more effective since they retain greater bargaining leverage. Wallensteen, “Economic Sanctions” in Nincic and Wallensteen, Dilemmas of Economic Coercion.

12 Lindsay, “Trade Sanctions”, 155.

13 Knorr believes that sanctions work best when the threat is informal, the stake is not too high for the target, and sanctions are unilateral. He also emphasizes that poor, small countries are particularly vulnerable to sanctions due to trade dependence. Finally, he highlights the role of rally-around-the-flag effect, economic diversification by the target, and costs to the sender as the main reasons for sanctions failure. Knorr, Power of Nations, 156-161.

to influence policies in another.14 Quite unlike the bulk of the sanctions literature, Chan and

Drury are conscious of the mechanism they discuss, terming it compellence and pointing out that it requires clear communication by the sender.15 In the same volume, Drury talks about sanctions as working through “coercive diplomacy”, which is the same as compellence.16

Drezner shows the compellence mechanism in detail (although not terming it as such) in the cases of US coercion with South Korea vis-à-vis North Korea, and Russian sanctions on the former CIS states.17 He also suggests the working of the political fracture mechanism.18

Cortright and Lopez discuss the “bargaining model” of sanctions where they act as a form of persuasion.19 This is the carrot-and-stick diplomacy advocated by the concept of coercive diplomacy. The work of Nincic and Wallensteen, Daoudi and Dajani, Baldwin, Hufbauer et al,

Chan, and Kaempfer and Lowenberg imply the possibility of both the political fracture and compellence mechanisms i.e. changing target policy through domestic pressure or through external coercion.20

Very few authors other than Crawford and Klotz,21 who first put forward the framework of different mechanisms, discuss resource denial as a possible route for the working of

14 Chan and Drury, Sanctions as Economic Statecraft.

15 Chan and Drury, Sanctions as Economic Statecraft, 9.

16 Drury, “How and Whom the US President Sanctions” in Chan and Drury, Sanctions as Economic Statecraft.

17 Drezner, Sanctions Paradox.

18 Drezner, “The Complex Causation of Sanctions Outcomes” in Chan and Drury, Sanctions as Economic Statecraft.

19 Cortright and Lopez, Sanctions Decade.

20 Baldwin, Economic Statecraft; Chan, “Economic Sanctions; Daoudi and Dajani, Economic Sanctions; Hufbauer et al, Economic Sanctions Reconsidered; Kaempger and Lowenberg, “Public Choice Analysis”; Nincic and Wallensteen. “Economic Coercion”.

21 Crawford and Klotz, How Sanctions Work.

sanctions. According to this, sanctions effectively limit the resources or funds needed by the target to continue its undesired policy. Lopez and Cortright argue that Iraq was effectively disarmed through the resource denial mechanism (although they do not use the term “resource denial”).22 They hold that sanctions succeeded in intercepting crucial materials such as specialized aluminum tubes and fluorine gas; together with the strict inspections regime that

Iraq was forced to accept as a result of sanctions, sanctions caused nuclear restraint through resource denial. O’Sullivan has similarly argued that resource denial contributed to the containment of Iraq, and that international control of Iraq’s oil revenues reduced funds for its nuclear weapon program.23 She believes that policy change by the target is best achieved through compellence involving dialogue and bargaining; a target regime may be contained through resource denial; and regime change can occur through either resource denial or political fracture.24

Only a handful of scholars have articulated the possibility of resource constraints as altering target policy. Crawford and Klotz, O’Sullivan, and Drezner emphasize the divergence in possible causal paths by which sanctions may work.25 A central contribution of the dissertation is that it offers a simple distinction between the two possible ways in which sanctions may change target policy – by affecting target capabilities, or by affecting the target’s will. The latter, which I term “motivational changes”, incorporates a range of mechanisms including domestic pressure and external coercion.

22 George A. Lopez and David Cortright, “Containing Iraq: Sanctions Worked”, Foreign Affairs, 83 No. 4 (2004).

23 O’Sullivan, Shrewd Sanctions.

24 O’Sullivan, Shrewd Sanctions, 288-291.

25 Crawford and Klotz, How Sanctions Work; Drezner, “An analytically eclectic approach to sanctions” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation; O’Sullivan, Shrewd Sanctions; David D. Palkki and Shane Smith, “Contrasting causal mechanisms: Iraq and Libya” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation. 91

Conclusion: Literature on Economic Sanctions

This extensive survey of the literature on economic sanctions shows both the abundance of work and the lack of agreement among scholars on such matters as the definition of success, and the conditions for success. The first wave scholarship holds that sanctions often fail to change target policy, while the second wave maintains that sanctions are useful in offering some benefits with relatively low costs. However, the general consensus among both bodies of work is that economic sanctions are unlikely to bring major policy alterations in the target state.

The first wave scholars attribute the failure of sanctions to the target’s ability to adjust by adopting political measures such as rally-around-the-flag, or economic steps such as diversifying trade partners. Second-wave scholars generally do not challenge the first wave observation that such actions can limit the impact of sanctions. However, they point out that sanctions may nevertheless be successful through symbolic effects, by entailing significant costs of adjustment to the target, or by bringing unbearable economic damage despite domestic political support. Thus the difference between the first and second wave is not as stark as it first appears.

As this review shows, the large literature on sanctions offers a variety of hypotheses on the factors affecting sanctions success. Arguments made in opposite directions – for example that short sanctions are more successful, with others holding that longer sanctions are more effective – are both logically valid. Shorter sanctions give the target less time to adjust while longer ones allow time for the costs to kick in. At the end of the day, the balance of opposing viewpoints is likely to vary on a case-by-case basis. The review shows that no one argument is conclusive and that the ultimate impact depends on interactions with other variables.

Conclusion

As seen from this review, the expected effect of sanctions on nuclear programs is uncertain. The work on sanctions suggests that sanctions could restrain nuclear programs under the right conditions, such as when they are multilateral, the target is weak, and the target is democratic. In the final analysis, the literature tends to have low expectations about the ability of sanctions to induce nuclear restraint.

The principal insight from the literature is the distinction between two processes whereby nuclear programs may be restrained – resource denial and motivational changes. While the former highlight the target’s capabilities to pursue nuclear weapons, the latter emphasizes its motives. Unlike in the case of proliferation – where capabilities alone are insufficient to explain proliferation – restraint can be explained by resource denial. Another important insight from the literature is the three-fold classification of motives into security, domestic politics, and prestige.

The varied causal processes by which sanctions may affect the cost-benefit calculus on nuclear programs can be categorized into one of these three models.

The distinction between unintentional and intentional restraint ultimately draws from

Schelling’s conception between brute force and coercion.26 The distinction between capability and intention is also seen, in rare instances, in the sanctions literature.27 Schelling’s analysis helps focus the dissertation on the central division between capability and motives. Hence, although domestic political pressures or a change in the regime cannot properly be referred to as

26 Schelling, Arms and Influence.

27 For example, Crawford and Klotz, and Drezner point to the fact that restraint can be the result of resource denial alone. Crawford and Klotz, How Sanctions Work; Drezner, “An analytically eclectic approach to sanctions” in Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 164.

“motives” for restraint, the dissertation considers such factors within the broader category of motives. In fact, they fall into the domestic politics model as elucidated by Sagan.28

28 Sagan, “Why Do States Build Nuclear Weapons?”

CHAPTER 3

RESEARCH DESIGN

In seeking to understand the role of sanctions in nuclear restraint, the dissertation brings together insights from the existing work on proliferation and sanctions. As established in the previous chapter, sanctions have generally not been considered an important explanation of nuclear restraint. In recent years, they have received more attention following Libya’s surprising announcement on nuclear rollback in 2003. However, even the recent full-length work on sanctions and proliferation does not consider sanctions to be a definitive cause of restraint.29

Given our limited current knowledge on the subject, I adopt the case-study method. This qualitative focus helps shed light on the intricate mechanisms that may be at play;30 although generalization may be limited, this approach can offer accuracy of explanations for given cases.

In this chapter I specify the research question and define key variables. I then state the central hypothesis, which identifies resource denial and motivational changes as two distinct ways in which sanctions can affect nuclear programs. Finally, I elaborate the research method, which is based on comparative case studies. I use Alexander George’s “structured, focused comparison” to understand the evolution of nuclear weapons programs in four countries.

Research Question

The dissertation asks the following question: What is the role, if any, of economic sanctions in nuclear restraint? The effort is to determine whether and to what extent sanctions

29 Solingen, Sanctions, Statecraft, and Nuclear Proliferation.

30 Gerring notes that the case-study method is generally better than others for the purpose of investigating causal pathways. John Gerring, Case Study Research: Principles and Practice (New York: Cambridge University Press, 2007), 48.

play a part in the ending or slowing of nuclear weapons programs. In order to answer this question, it is essential to isolate the impact of sanctions on restraint.

The dependent variable is nuclear restraint, which is the scaling back of efforts at a nuclear weapons program or the dismantling of existing weapons. It includes both the slowing and the ending of a weapons program. Restraint may be the result of changes in either motivations of the state,31 or of technical/economic pulls it faces. It is itself reversible since the country can restart its weapons program in the future as its technical and motivating factors change.

I define nuclear restraint as the slowing, stopping, or rollback of a nuclear weapons program.

It may be intentional (motivational) or unintentional. This definition differs slightly from Ariel

Levite’s characterization of nuclear restraint as “a governmental decision to slow or stop altogether an officially sanctioned nuclear weapons program”.32 Whereas Levite emphasizes that restraint is a decision, I leave open the possibility that it could be unintentional.

Nuclear restraint can be seen as the opposite of “nuclear pursuit” where a state explores the nuclear weapons option, pursues its development, or actually acquires nuclear weapons.33 I conceptualize nuclear pursuit as incorporating any effort toward or interest in a nuclear weapons program. Thus at any point of time, a country with a potential or actual weapons program must display either nuclear pursuit or nuclear restraint – if it has a continuing, standstill program it

31 At the heart of the puzzle of nuclear restraint lies the observation that changes in the drivers of nuclear weapons programs are insufficient to explain restraint. Inertia, the possible political embarrassment of retracing one’s steps, and the likely international bargaining benefits from wielding the program all suggests that the erosion of the original motivations for nuclear weapons is an inadequate explanation of nuclear restraint.

32 Levite, “Never Say Never Again”, 67.

33 These three stages of explore, pursuit, and acquisition are taken from Singh and Way where they lay out four possible stages of nuclear weapons programs -- stage ‘0’: no interest in nuclear weapons acquisition; stage ‘1’: explore or seriously consider building nuclear weapons indicated in such measures as political authorization to explore the option or linking nuclear research to defense; stage ‘2’: pursue nuclear weapons through high-level political decisions or concerted efforts at weaponization; stage ‘3’: acquire nuclear weapons by assembling them and/or testing. Singh and Way, “Correlates of Nuclear Proliferation”, 865-867

displays nuclear pursuit while nuclear restraint occurs if the effort slows down, stops, or is dismantled.

I use the following specification for the three types of restraint as slow, stop, or rollback.

Table 3.1 Three types of nuclear restraint

Type of Definition Restraint Slow When projects for fuel cycle capability move more slowly than the country is able to, or more slowly that it would like to Stop When projects for acquiring fuel cycle capability are suspended or abandoned

Rollback When projects/facilities for fuel cycle capability are incapacitated (removed, made inoperable, dismantled, or destroyed)

By focusing on fuel cycle capability, the research overcomes some of the ambiguity often seen in the proliferation literature.34

Despite these attempts to clearly demarcate the concepts of nuclear pursuit and nuclear restraint, the real world complexity implies that nuclear programs often display elements of both pursuit and restraint. This applies to the ‘slow’ type of restraint, where slow growth can coexist with pursuit. This is seen in several cases, most notably in Iran’s nuclear program in 2006-2010.

Instances of stopping or rolling back a nuclear program are relatively clear to identify. I use the following criterion to distinguish nuclear pursuit from the ‘slow’ category of nuclear restraint.

As stated in the table, a program is slow if it grows more slowly than it is capable of. Such capabilities can generally be identified. A program is also considered slow when it grows more slowly than leaders would like it to. This subjective notion is measured against the pace of the program in years just prior to the period under consideration. In other words, if a nuclear program proceeds more slowly than in previous years, I classify that period as restraint. In

34 Sagan, “Nuclear Latency and Nuclear Proliferation”, 82-90. 97

addition, any declared statements by leaders regarding their intentions on the nuclear program are also taken into account in gauging restraint.

The independent variable is economic sanctions, defined as the deliberate government withdrawal or threat of withdrawal of customary economic relations to seek change in a particular policy (or policies) of the targeted state. The “sender” is the country or international organization imposing sanctions, while the “target” is the state that receives the sanctions.

Because they are political instruments, sanctions are measured according to the declaration or communication by the sender to the target, such as enacting laws prohibiting trade with the target. In other words, an economic sanction is deemed to have been threatened or imposed based on evidence that the sender articulated such a policy.

To summarize, the research question is: what is the role of economic sanctions in nuclear restraint? The focus is on understanding nuclear restraint, the puzzling phenomenon of the slowing, stopping, or rolling back of nuclear weapons programs. The central focus is on restraint

(and not sanctions); the dissertation is not primarily concerned with the effects of sanctions.

Therefore it does not seek to trace the overall effect of sanctions on a nuclear program; instead, it focuses attention on the role of sanctions in explaining instances of nuclear restraint.35

Practically, this means that each country’s nuclear program is divided into instances of restraint.

I then analyze the role of sanctions in bringing about those specific cases of restraint. In other words, I do not analyze the impact of sanctions on every instance of nuclear pursuit.36

35 This is not to say that I ignore the overall effects of sanctions. In fact, in the detailed process tracing that follows, I do consider the complex factors of both the general causes of nuclear restraint, as well as the effects of sanctions.

36 Depending on the stage of the nuclear program and the presence or absence of sanctions, I do at times, consider how sanctions affected nuclear pursuit. For example, I study the possible effects of US and UN sanctions on Libya’s nuclear pursuit 1995-2002.

Hypothesis

The dissertation hypothesizes that sanctions can contribute to nuclear restraint by limiting resources (“resource denial”) and/or by changing the cost-benefit calculus of leaders

(“motivational changes”). This is an important insight, especially since the proliferation as well as the sanctions literature has tended to focus exclusively on the latter i.e. changing motives or coercing leaders.

Resource Denial

In this process, a nuclear program slows, stops, or rolls back due to the sheer physical inability to pursue the program. Such physical constraints on the nuclear program can arise either from military attacks (or sabotage), or from the dwindling of resources for the program.

While military attacks can roll back a nuclear program – best seen in Iraq during the 1991 war – the lack of financial and technical resources can at best stop a program. A nuclear program cannot be dismantled or rolled back by the sheer lack of resources. Since sanctions-induced resource denial refers to the latter, this implies that sanctions-induced resource denial can at most stop a nuclear program. A second logical observation regarding sanctions-induced resource denial is that it cannot take place unless sanctions are actually imposed, not merely threatened. Since resource denial refers to the physical, unintentional consequence of the lack of adequate resources, it necessarily requires sanctions to be enforced on the ground.

Motivational Changes

In the second process, a nuclear program slows, stops, or rolls back due to a changing cost-benefit calculus in favor of restraint. Naturally, a multitude of factors, including sanctions, can affect such calculations. For sanctions to induce such motivational changes, they must be credible and potent. Sanctions can be either threatened or imposed. In fact, Schelling points out

that threatened punishment tends to be more effective than that which is enforced. In any case, the potency of sanctions depends on what the target values.37 Credibility is easily achieved if sanctions are imposed. For sanctions to motivate restraint, the target must perceive that the sender desires restraint; and that the sanctions will be reduced or removed in exchange for restraint.38 These requirements for sanctions to persuade nuclear restraint are summed up as: sanctions must be credible and potent; and they must be accompanied by credible reassurances that they will be reduced or ended in exchange for restraint.

Method: Structured, Focused Comparison of Cases

Case studies are particularly helpful in the study of phenomena involving “equifinality” or alternate paths to the same outcome.39 Their contribution is in presenting in-depth analyses and internal validity.40 The specific case-study method adopted is structured, focused comparison first developed by Alexander George. It is used to generate contingent generalizations based on historical experiences.41 Having formulated the research question and specified the key variables, the researcher must then select cases for detailed study.42 This dissertation studies the nuclear programs in four countries – Iraq, Taiwan, Libya, and Iran. The rationale for choosing this set of countries is given below.

37 Schelling, Arms and Influence, New ed., 3.

38 Schelling, Arms and Influence, New ed., 4, 74.

39 Alexander L. George and Andrew Bennett, Case Studies and Theory Development in the Social Sciences, (Cambridge, MA: MIT Press, 2005), 20.

40 Gerring, Case Study Research.

41 George and Bennett, Case Studies, 69-71.

42 George and Bennett, Case Studies, 83-84.

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The next crucial step in structured, focused comparison is to formulate a fixed set of questions to be asked of each case.43 This dissertation revolves around the key distinction between resource and motivational factors affecting proliferation. For each country that is selected, I lay out the evolution of the nuclear program using process tracing. Each instance of nuclear restraint is then analyzed, asking whether it is driven by resource factors, motivational factors, or both. To isolate the impact of sanctions, I also use counterfactual analysis.

Case Selection

Existing literature classifies several countries as displaying nuclear restraint, defined as the stopping or rolling back of nuclear weapons programs, or the dismantling of nuclear weapons. As shown earlier, the literature does not offer a close distinction between the slowing, stopping, and rolling back of nuclear programs. Instead, it tends to use the blanket term

“reversal” or “restraint” to refer to the stopping or dismantling of weapons or weapons programs. The countries that are known to have done either are listed below.

Table 3.2 Cases of nuclear restraint

(1) Italy (2) West Germany (3) Yugoslavia (4) Australia (5) Egypt (6) Switzerland (7) Sweden (8) South Korea (9) Taiwan (10) Iran44 (11) Brazil (12) Iraq (13) Algeria

43 George and Bennett, Case Studies, 86-87.

44 This refers to the stopping of the nuclear program after the Islamic Revolution of 1979.

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(14) Romania (15) South Africa (16) Kazakhstan (17) Ukraine (18) Belarus (19) Libya

Source: Taken from Scott D. Sagan, “The Causes of Nuclear Weapons Proliferation”, Annual Review of Political Science, 14, 2011, Figures 1 and 2 – all countries marked with a negative sign in Sagan’s figures are listed above in chronological order.

The above table includes countries that have merely explored a nuclear weapons program, and not necessarily embarked upon it. A central point of this dissertation, however, is that nuclear rollback is a particularly puzzling phenomenon as it entails the dismantling of weapons-usable facilities after they are actually launched, not merely discussed or considered.45

This research seeks to understand the role of sanctions in nuclear restraint, which is understood as the scaling down of a program that has already been begun. Since the central puzzle driving the research is nuclear rollback i.e. the dismantling of facilities or projects for fuel cycle capability, I use rollback as an important criterion for case selection.46 As stated earlier, nuclear rollback refers to incapacitating existing projects or capabilities in the nuclear fuel cycle. This is best seen in terms of dismantling or destroying facilities. Using this definition, and based on the latest estimations from Sagan, I categorize nuclear weapons programs as following.47

45 This refers to Singh and Way’s stage ‘1’ in their classification of the stages of nuclear weapons pursuit -- explore or seriously consider building nuclear weapons, indicated in such measures as political authorization to explore the option or linking nuclear research to defense. Singh and Way, “Correlates of Nuclear Proliferation”, 865-867.

46 As described in the introductory chapter, dismantling projects (or facilities) for nuclear weapons-related activities is the most puzzling because they entail eliminating activities that have already been embarked upon. Rollback also implies overcoming any vested interests in the nuclear program (such as scientific and military-industrial), and the absence of new justifications for the program.

47 Scott D. Sagan, “The Causes of Nuclear Weapons Proliferation”, Annual Review of Political Science, 14, 2011.

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Table 3.3 Cases of nuclear rollback

Rollback No Rollback (1) South Korea (1) US (2) Taiwan (2) Russia (3) Brazil (3) UK (4) Iraq (4) France (5) South Africa (5) China (6) Kazakhstan (6) Israel (7) Ukraine (7) India (8) Belarus (8) Pakistan (9) Libya (9) North Korea (10) Syria

Thus the focus of the dissertation is in the first column in the table above. Sanctions can be reasonably expected to have been influential in only some of these instances. The following table lists the sanctions on the countries whose nuclear programs have rolled back.

Table 3.4 Sanctions on countries whose nuclear weapons programs have rolled back

Country Periods of Periods of Sender Purpose of Sanctions Rollback Sanctions S. Korea 1975-1976 1973-1977 US Human rights

1975-1976 US, To forego nuclear reprocessing Canada Taiwan Late 1970s 1976-1977 US To forego nuclear reprocessing

1987-1988 Ukraine 1991-1996 1993-1997 Russia Control over Black Sea Fleet and nuclear weapons Kazakhstan 1991-1995 1993-1996 Russia To limit independence; control energy resources Iraq 1991-1998 1979-82 US To end support to terrorism

1980-2003 US Terrorism; chemical and nuclear weapons

1990-2003 US To curb proliferation; desabilization

1990-2003 UN To withdraw from Kuwait, curb proliferation Libya 2003 1978-2004 US To end support to terrorism and to 103

destabilize Qaddafi

1992- UN To end support to terrorism 1999/2003 Argentina 1990-1995 1944-1947 US To end Nazi influence and destabilize Peron government

1977-1983 US Human rights

1978-1982 US To adhere to nuclear safeguards

1982 UK To withdraw from Falklands Brazil 1990-1998 1962-1964 US For expropriation claims and to destabilize the leftist regime of Goulart

1974-84 US Human Rights

1978-81 US To adhere to nuclear safeguards South 1989-1991 1962-1993 UN To end apartheid and for Namibian Africa independence

1975-1982 US To adhere to nuclear safeguards and to avoid nuclear testing

1985-1993 US To end apartheid

By comparing periods of rollback with periods of sanctions, it is seen that rollback and sanctions have overlapped in all the above countries except Argentina and Brazil. Therefore it is reasonable to conclude that sanctions were not significant in ending the nuclear programs of

Argentina and Brazil.48 Since the purpose of this study is to understand how sanctions work if they do, this leads me to exclude Argentina and Brazil from a detailed analysis. The remaining countries where sanctions may have been an important cause of rollback are: South Korea,

48 Admittedly, sanctions can have lag effects so that the absence of sanctions at the time of rollback does not necessarily indicate their ineffectiveness. However, Argentina and Brazil are commonly understood to have rolled back their weapons programs under bilateral rapprochement, rather than due to sanctions. Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., 12; Joseph Cirincione, Jon B. Wolfsthal and Miriam Rajkumar Deadly Arsenals: Tracking Weapons of Mass Destruction, 2nd ed. (Washington D.C.: Carnegie Endowment for International Peace, 2005).

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Taiwan, Ukraine, Belarus, Kazakhstan, Iraq, Libya, and South Africa. Of these, I exclude the former Soviet states since they cannot be properly said to have rolled back nuclear programs, as they inherited nuclear weapons from the Soviet Union.49 Of the remaining cases – South Korea,

Taiwan, Iraq, Libya, and South Africa, I select four countries on the basis of what we can learn the most. South Africa is excluded because sanctions are commonly not regarded as influential in

South Africa’s nuclear rollback.50 South Korea and Taiwan display many similarities in undertaking nuclear restraint roughly around the same time and for similar reasons (mid to late

1970s, under US pressure). From among the two, I select Taiwan since its weaker security guarantee from the United States makes it a bigger puzzle than South Korea.51

In proceeding along this line, I am adopting a unique combination of what Mahoney and Goertz refer to as the “causes-of-effects” and “effects-of-causes” approaches.52 They hold that qualitative research is based on the causes-of-effects approach since it examines effects of phenomena in order to move back to the drivers or causes. Quantitative research, on the other hand, tends to have an effects-of-causes view since it attempts to estimate the average effect of some given causes. In my analysis, I use a combination of these two methods by first adopting a causes-of-effects approach – inquiring as to what causes nuclear rollback. Next, I take an

49 This means that the puzzle of nuclear rollback is not as stark in the cases of Ukraine, Belarus, and Kazakhstan, because they did not dismantle nuclear programs that they themselves had started.

50 It is commonly held that South Africa dismantled its nuclear weapons due to declining security threats accompanying the ending of the cold war. It is also attributed to the leadership of F. W. de Klerk. Paul, Power Versus Prudence, 117; Reiss, Bridled Ambition, 20; Levite, “Never Say ‘Never’”, 2002/03, 84.

51 Both South Korea and Taiwan faced considerable insecurities and threat perceptions in the early 1970s with the outcome of the Vietnam War and the thawing of US relations with the PRC. Despite the withdrawal of 24,000 US troops, South Korea continued to retain US ground forces and tactical nuclear weapons. Taiwan however, viewed the US opening to the PRC, its replacement by the PRC as a member of the UN, and the Nixon Doctrine (indicating a reduced US commitment to its Asian allies) with fear.

52 James Mahoney and Gary Goertz, “A Tale of Two Cultures: Contrasting Quantitative and Qualitative Research”, Political Analysis, 14 No. 3 (2006).

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effects-of-causes approach – asking what the effect of economic sanctions on nuclear restraint is.53

Selecting the same value on the dependent variable (nuclear restraint), however, has been famously admonished as introducing selection bias into the research.54 Hence I choose one country where nuclear rollback has not occurred.55 The negative cases or instances where nuclear restraint did not occur are selected according to the “possibility principle”. This principle holds that the researcher should select only those negative cases where the outcome studied is possible, while those where the outcome is unfeasible should be discarded.56 In order to keep the total number of countries to a limited, manageable size, I select one case of “no rollback”. From Table 3, these countries are: Israel, North Korea, India, Pakistan, Iran, Syria (?),

US, UK, France, Russia, China.

Since the P-5 states are very unlikely to undertake nuclear rollback, they are excluded.

Of the remaining states (i.e. Israel, North Korea, India, Pakistan, and Iran), Iran and North

Korea are the most suitable for analysis since they are under sanctions (for nonproliferation purposes), and are or were NPT members. I choose to study Iran as a case of no-rollback due to the recent international focus on Iran’s nuclear program, as well as the plethora of calls for and

53 I am thankful to James Mahoney for pointing out to me this aspect of my research at the Institute for Qualitative and Multi-Method Research, Arizona State University, 2008.

54 Gary King, Robert O. Keohane, and Sidney Verba, Designing Social Inquiry: Scientific Inference in Qualitative Research (Princeton: Princeton University Press, 1994), 129-130.

55 In any case, King et al point out that selecting cases with the same value on the dependent variable “is not a bad first attempt at the problem”, as it helps generate hypotheses about a little understood topic. King et al, Designing Social Inquiry, 134.

56 The possibility principle is based on the rules of “inclusion” and “exclusion”. The “Rule of Inclusion” is “Cases are relevant if their value on at least one independent variable is positively related to the outcome of interest” and the “Rule of Exclusion” is “Cases are irrelevant if their value on any eliminatory independent variable predicts the nonoccurrence of the outcome of interest. James Mahoney and Gary Goertz, “The Possibility Principle: Choosing Negative Cases in Comparative Research”, American Political Science Review, 98 No. 4 (2004), 657-658.

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imposition of sanctions on Iran for the specific purpose of inducing restraint. The four countries studied in this dissertation, therefore, are: Iraq, Taiwan, Libya, and Iran.

Case Analysis

In the chapters analyzing their nuclear programs, I divide each program into phases of nuclear pursuit or restraint. Each of these sub-periods is the final case in this research, providing wide variance in the value of the dependent variable (nuclear pursuit or restraint) and the independent variable (sanctions). For each case of restraint, I seek to assess whether it was primarily driven by resource constraints or motivational factors. After establishing the dominant process in each instance, I then determine the role of sanctions in restraint.57 For each case, therefore, I ask whether restraint was brought about by resource constraints or motivational factors. This is the standard question asked of each case, as required in structured, focused comparison.58 If motivational factors are assessed to have played a role, I then ask whether motives changed through the security, domestic politics, or prestige models.

Two techniques commonly used in case studies – process tracing and counterfactual analysis – are discussed below.

Process Tracing

Ultimately, the case studies shed light on alternate paths through “process tracing”, where the researcher offers a causal narrative tracing the origins and evolution of the phenomenon in a given case. Such a method is particularly useful when controlled comparison

57 In some cases, both resource and motivational factors appear to be equally important. I such instances I evaluate the role of sanctions in both routes.

58 George and Bennett, Case Studies, 86-87.

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is difficult to implement.59 Process tracing is a key method that illuminates the equifinailty of most social phenomena, where an outcome is brought about by more than one causal path.60 It involves the use of different types of evidence to verify a single inference.61 Although it focuses on an individual case, it can still have important conclusions that are generalizable. Process tracing is based on “contextual knowledge” or some common assumptions about how the world works, from which the researcher can draw conclusions.62

It is important to keep in mind that process tracing must be applied not only to the hypotheses of interest to the researcher; it must equally be used for propositions that challenge the researcher’s hypotheses.63 Hence I pay close attention to important alternative explanations in each case. For example, Iraq’s nuclear rollback cannot be examined with considering the impact of the 1991 Gulf War and its aftermath.

Counterfactual Analysis

Finally, the method of “counterfactual analysis” is employed while studying all the potential hypotheses for a given case. It is often an underlying element in process tracing,64 and helps close comparison when it is difficult to locate two similar cases.65 Counterfactual analysis is a thought experiment where the researcher asks if the observed phenomenon would have occurred in the absence of particular factors. This helps to isolate the explanatory role of

59 George and Bennett, Case Studies, 214.

60 George and Bennett, Case Studies, 207.

61 Gerring, Case Study Research, 173.

62 Gerring, Case Study Research, 178-181

63 George and Bennett, Case Studies, 217.

64 Gerring, Case Study Research, 182.

65 George and Bennett, Case Studies, 167.

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independent variables. Counterfactual analysis is appropriate within a given case or “local domain” where the processes are well understood.66 They are appropriate to establish necessary causes, but not for sufficient causes.67

I use the “idiographic” type of counterfactual argument as the focus is on specific instances in given case studies.68 According to this, the researcher studies the various possibilities in a set time period by drawing on an in-depth knowledge of the case as well as a general understanding of cause and effect in social relations.69

Tetlock and Belkin have advanced criteria for making good counterfactual analyses, most particularly the “minimal-rewrite-of-history rule”. According to this, the counterfactual effort should not involve a hypothetical scenario where the world is substantially different i.e. the hypothesized change should “not unduly disturb what we otherwise know about the original actors and their beliefs and goals”.70 This means that the counterfactual world must be objectively possible. The best way to achieve this is to conceive of a world without the independent variable but with all else the same.71

66 James D. Fearon, “Causes and Counterfactuals in Social Science: Exploring an Analogy between Cellular Automata and Historical Processes” in Philip E. Tetlock and Aaron Belkin, eds., Counterfactual Thought Experiments in World Politics: Logical, Methodological, and Psychological Perspectives (Princeton: Princeton University Press, 1996), 52.

67 James Mahoney, Erin Kimball, and Kendra Koivu, “The Logic of Historical Explanation” (unpublished paper, November 20, 2007).

68 Philip E. Tetlock and Aaron Belkin, “Counterfactual Thought Experiments in World Politics: Logical, Methodological, and Psychological Perspectives” in Tetlock and Belkin, Counterfactual Thought Experiments.

69 Tetlock and Belkin, “Counterfactual Thought Experiments” in Tetlock and Belkin, Counterfactual Thought Experiments, 7.

70 Tetlock and Belkin, “Counterfactual Thought Experiments” in Tetlock and Belkin, Counterfactual Thought Experiments, 23.

71 Fearon, “Causes and Counterfactuals” in Tetlock and Belkin, Counterfactual Thought Experiments.

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In addition, counterfactuals must clearly specify antecedents and consequents, be logically consistent, be in keeping with well-established theories and statistical generalizations, and have testable implications in the real world.72 Counterfactuals are difficult to undertake with equifinality as the absence of one causal path does not preclude other paths from leading to the desired outcome.73

Sources

In the case studies that follow, I use available sources of information, largely relying on open source materials. Where possible, I have sought to interview experts who have been involved or studied the nuclear programs in these countries. In the case of Taiwan, ample declassified information was accessed through the National Security Archive at the George

Washington University. Due to the secret nature of information surrounding nuclear programs, I often use alternative indicators such as economic data. Ultimately, the research is limited by the fact that states tend to act as “black boxes” with regard to their nuclear programs, including past nuclear programs.

72 Tetlock and Belkin, “Counterfactual Thought Experiments” in Tetlock and Belkin, Counterfactual Thought Experiments, 19-31.

73 Gary Goertz and Jack S. Levy, “Causal Explanations, Necessary Conditions, and Case studies” in Gary Goertz and Jack S. Levy, eds., Explaining War and Peace: Case Studies and Necessary Condition Counterfactuals (New York: Routledge, 2007).

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CHAPTER 4

IRAQ

Since the 2003 war it has become evident that Iraq had not restarted its nuclear weapons program. The Iraq Survey Group, the team appointed by the George W. Bush administration for the purpose of uncovering WMD in Iraq, concluded that the nuclear program terminated in 1991 after the Gulf War.1 Nevertheless few analyses have sought to understand why, contrary to all expectations, Iraq did not renew the program after 1991. It is generally believed that this was the result of unprecedented UN inspections in the years after the Gulf War.2 Iraq was also placed under severe economic sanctions between 1990 and 2003 that were intended, at least in part, to destroy its nuclear ambitions. This chapter assesses the role of sanctions in stopping and reversing the Iraqi nuclear program, with a special focus on the comprehensive sanctions since

1990.

According to the Iraq Survey Group, “Iraq did not possess a nuclear device, nor had it tried to reconstitute a capability to produce nuclear weapons after 1991”.3 The critical turning point after which the nuclear program was not reconstituted was Desert Storm in January-

February 1991. The war significantly slowed down the program by destroying key facilities and hampering the country’s industrial infrastructure. The nuclear effort stopped completely in April

1991, when the UN Security Council passed Resolution 687 formally establishing a ceasefire

1 In Operation Desert Storm, commonly known as the Gulf War, the United States led some 680,000 coalition forces in a UN-authorized war to oust Iraqi troops from Kuwait. It lasted six weeks in January-February 1991.

2 Michael Friend, After Non-Detection, What? What Iraq’s Unfound WMD Mean for the Future of Non- Proliferation, United Nations Institute for Disarmament Research: Geneva, UNIDIR /2003/38, 16; George Lopez and David Cortright, “United Nations sanctions and nuclear weapons” in Jane Boulden, Ramesh Thakur, and Thomas G. Weiss, edited, United Nations and Nuclear Orders, Tokyo: United Nations University Press, 114; O’Sullivan, Shrewd Sanctions, 140.

3 Iraq Survey Group, Comprehensive Report of the Special Advisor to the Director of Central Intelligence on Iraq’s WMD, (Central Intelligence Agency, 30 September 2004), Volume 2, 7.

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and demanding complete WMD disarmament. Under rigorous UN inspections since May 1991, all remaining equipment and materials associated with the nuclear program were removed, destroyed, dismantled, or rendered inoperable.

This analysis argues that Iraq’s nuclear program was rolled back by military action and intrusive inspections. Sanctions helped prevent the rebuilding of the program after it was thus eliminated. Sanctions contributed by denying resources, and by pushing the regime to focus on survival from domestic threats. Sanctions did not, however, persuade Iraq’s leader to give up nuclear weapons ambitions.

The chapter begins with a brief summary of the origin and growth of Iraq’s nuclear program. It then considers the various stages of restraint in the program, categorized as slowing, stopping, or rolling back. In each instance the analysis proceeds by first assessing whether restraint was largely brought about by motivational factors or resource constraints. After establishing the dominant route for restraint in each stage, the chapter then considers whether sanctions helped restrain the nuclear program.

The Nuclear Program

Iraq’s nuclear program began in the mid-1950s with American assistance under Atoms for Peace, leading to the establishment of the Iraqi Atomic Energy Commission in 1956 and the

Tuwaitha Atomic Center for nuclear research in the late 1950s. After the fall of the monarchy in

1958 Iraq negotiated with the Soviet Union, which supplied a small research reactor that started operating at Tuwaitha in 1968.4 The Soviets began supplying HEU reactor fuel enriched to 80%

4 The reactor initially had a capacity of 2 MW and was upgraded to 5 MW in 1978, when it became known as the IRT-5000. Jed C. Snyder, “Iraq”, in Jed C. Snyder and Samuel F. Wells Jr., Limiting Nuclear Proliferation, edited, Cambridge, Massachusetts: Ballinger Publishing Company, 1985, 4.

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in 1978.5 Although Iraq signed the NPT in 1968 and ratified it in 1969, incipient efforts to produce plutonium -- signaling an interest in weaponization -- emerged in the mid 1970s under the leadership of Saddam Hussein, who headed the Iraqi Atomic Energy Commission (IAEC) from1973 to 1979.6

The nuclear program has been described as ‘modest’ until around 1974 when Iraq concluded a major nuclear cooperation agreement with France, the start of several cooperative ventures with Western nations.7 In 1975 Saddam Hussein declared he was setting up a nuclear power program, which was to be based on obtaining turnkey projects covering the entire fuel cycle.8

The same year he also stated publicly that the Iraqi nuclear effort would produce the first Arab atomic bomb.9 Indeed, in the early 1970s scientists and other members of the nuclear establishment believed that the political leadership (i.e. President Hassan al-Bakr and Vice

President Saddam Hussein) viewed nuclear weapons as the logical conclusion of an advanced nuclear program.10

5 Snyder, “Iraq”, 5.

6 Although Hussein relinquished this formal position in 1979 when he became President of Iraq, he continued to be involved in the IAEC and its activities grew immensely since then. Richard Rhodes, The Twilight of the Bombs: Recent Challenges, New Dangers, and the Prospects for a World Without Nuclear Weapons, New York: Alfred A. Knopf, 2010, 16.

7 Spector, Nuclear Proliferation Today, 166.

8 Malfrid Braut-Hegghammer, “Revisiting Osirak: Preventive Attacks and Nuclear Proliferation Risks”, International Security, 36 (1), 2011, 106-107.

9 Dan Reiter, “Preventive Attacks against Nuclear Programs and the “Success” at Osiraq”, Nonproliferation Review, 12 (2), 2005, 357; Leonard S. Spector, Nuclear Proliferation Today, Carnegie Endowment for International Peace, New York: Vintage Books, 1984, 173-174.

10 Braut-Hegghammer, “Revisiting Osirak”, 105-106.

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The spurred interest in nuclear technology in the mid-1970s seems to have been facilitated by the influx of revenues following the oil crises.11 It was also driven by motivational considerations of security and prestige vis-à-vis Israel and Iran as discussed below.12 The recently begun ambitious nuclear program by the Shah of Iran is said to have had a ‘domino effect’ on Iraq.13 Deterring an Israeli attack also appears to have been an important consideration. In an apparent reference to nuclear weapons, in March 1979 Saddam Hussein told his senior advisers, “We want, when the Israeli enemy attacks our civilian establishments, to have weapons to attack the Israeli civilian establishments. We are willing to sit and refrain from using it, except when the enemy attacks civilian establishments in Iraq or Syria…”14 After the start of the Iran-Iraq war in 1980, Saddam Hussein showed concerns that Israel might supply

Iran with WMD, especially biological and chemical weapons.15

11 Amatzia Baram, “An Analysis of Iraqi WMD Strategy”, Nonproliferation Review, 8 (2), 2001, 28; Braut- Hegghammer, “Revisiting Osirak”, 106; Gary Samore, “Iraq”, in Mitchell Reiss and Robert S. Litwak, edited, Nuclear Proliferation after the Cold War, Washington, DC: Woodrow Wilson Center Press, 1994, 17; Snyder, “Iraq”, 5.

12 Baram, “An Analysis of Iraqi WMD Strategy”, 28-29.

13 Braut-Hegghammer, “Revisiting Osirak”, 109; Gordon Corera, Shopping for Bombs: Nuclear Proliferation, Global Insecurity, and the Rise and Fall of the A Q Khan Network, Oxford University Press, 2006, 60.

14 Kevin M. Woods, David D. Palkki, and Mark E. Stout, The Saddam Tapes: The Inner Workings of a Tyrant’s Regime 1978-2001, New York: Cambridge University Press, 2011, 223.

15 In a conversation with senior advisers in late 1981, Saddam Hussein stated, “One day, Israel will provide the Iranians with the know-how to wage a germ and chemical attack. Israel will provide the Iranians – they will approach an Iranian official and tell him, “Why don’t you attack them? He will say: “I do not know how.” Then they will tell him, “Come and we will teach you how to attack,” and they will teach him how to attack us. One of Israel’s objectives is not only as [Israeli Prime Minister Menachem] Begin would say for the sole purpose of protecting the security of Israel from Iraqi scientific advancement, but also to prolong the war between Iraq and Iran, because the Israeli planners, their strategic brains, want Iraq to remain preoccupied with Iran. So when Iraq has a deterrent capability against Iran, this means that one day, Iraq will turn its back with ease against Iran, who will not be able to confront it. So when he [Begin] removes this part for a period of time, he will maintain continuously through his intelligence means, the political influence and other reasons as well, he will be able to keep Iraq busy through its confrontation with Iran.” Woods et al, Saddam Tapes, 225-226.

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A nuclear weapons capability would also serve as a powerful symbol of prestige for Iraq, which the Ba’ath Party emphasized as the birthplace of civilization.16 True to its name -- Ba’ath is translated as the ‘Arab Resurrection Party’ – the party stressed Iraq’s splendid past and sought to reclaim it. The decision to acquire fuel cycle capability coincided with emerging Iraqi dominance in the Arab world in the late 1970s.17

Saddam Hussein saw himself as the last in a long line of great leaders like Nebuchadnezzar,

Hammurabi, and Sargon.18 He aspired to fill the shoes left vacant by Egypt’s charismatic leader

Gamal Abdel Nasser after his death in 1970. Hussein believed that a militarily strong Iraq both in terms of conventional military strength and WMD would allow him to present himself as the true Arab leader.19 He held that both for prestige and national security, “nuclear weapons were necessary for Iraq to survive”.20

Cooperation with France began in 1974, and in 1976 Iraq signed a contract with French firms for two reactors (discussed below). Iraq also seemed to move towards acquiring reprocessing capability, beginning negotiations with Italy in 1975 and obtaining a radiochemical laboratory in 1979. The lab, which was located at the Tuwaitha Nuclear Research Center, included three “hot cells” (lead-shielded rooms with remote-handling equipment for processing

16 The Ba’ath Party ruled Iraq from 1968 to 2003.

17 According to Tripp, a combination of factors led to Iraq’s resurgence in the Arab world– oil revenues following the oil crises; a 1975 agreement with Iran, which temporarily quelled territorial and other issues; Iraq’s accusation of Syria on supporting Kurdish rebels as well as Syrian invasion of Lebanon in 1976; and Iraqi criticism of Egypt for improving relations with Israel. Charles Tripp, A History of Iraq, Cambridge University Press, 2000, 218-219.

18 Steve Weissman and Herbert Krosney, The Islamic Bomb: The Nuclear Threat to Israel and the Middle East, New York: Times Books, 1981, 87.

19 Gawdat Bahgat, Proliferation of Nuclear Weapons in the Middle East, Gainesville: University Press of Florida, 2007, 54.

20 Iraq Survey Group, Comprehensive Report, Vol. 1, 26.

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radioactive materials) and could reportedly reprocess one spent fuel rod at a time from the small

Soviet reactor, the IRT-5000.21

After turning down a request for a large (500 MW) natural uranium gas-graphite nuclear power reactor,22 in 1976 France agreed to supply a light-water reactor, which was considered more proliferation resistant23 and an 800-kilowatt mockup of the same reactor. They were called

Tammuz I and Tammuz II respectively (France called them Osirak and Isis) and were located at

Tuwaitha. This reactor complex at Tuwaitha held the potential for weaponization since it could be used by Iraqi scientists to gain experience with the fuel cycle, and then carry out weapons work at a new undeclared facility elsewhere.24

The French also proposed to sell about 72 kilograms of 93% enriched HEU as fuel for the reactors. This generated widespread concern about the intent to weaponize among Israel, the

United States, some European countries, Saudi Arabia, and Syria.25 As a result, France decided to make the HEU available in limited quantities and required Iraq to return spent fuel. In reality

Iraq received only one shipment HEU enriched to 93%; it got 11.8 kg in 1980.26 France also

21 Braut-Hegghammer, “Revisiting Osirak”, 108; Spector, Nuclear Proliferation Today, 170.

22 This was because France was no longer producing the gas-graphite reactor. The gas-graphite reactor would have been more suitable for producing plutonium. Spector, Nuclear Proliferation Today, 167; Federation of American Scientists, Militarily Critical Technologies List, Part II: Weapons of Mass Destruction Technologies, accessed October 1, 2012, http://www.fas.org/irp/threat/mctl98-2/p2sec05.pdf, 42.

23 Although the light-water reactor is commonly considered less susceptible to proliferation, the fact that Iraq readily accepted it in place of a nuclear power plant as originally requested was considered proof of its weapons interest (Feldman 1982, 116). It is believed that Iraq opted for this less efficient way to reprocess plutonium (rather than through a heavy water reactor) as it would invite less negative attention from the IAEA and other international actors. Jed C. Snyder, “The Road to Osirak: Baghdad’s Quest for the Bomb”, Middle East Journal, 37 (4), 1983, 569.

24 Braut-Hegghammer, “Revisiting Osirak”, 115; Robert E. Kelley, “The Iraqi and South African Nuclear Weapons Programs: The Importance of Management”, Security Dialogue, 27 (1), 1996, 28.

25 Spector, Nuclear Proliferation Today, 169; Rhodes, Twilight of the Bombs, 15.

26 I have listed the more recent evaluation of the quantity of HEU fuel received from France, rather than Spector’s assessment of 12.5 kg. Spector, Nuclear Proliferation Today, 169. 116

stationed French technicians at the reactor site27 to ensure that fissile material was not diverted for weapons purposes.28 These measures, together with IAEA safeguards, meant that “large- scale diversion” of reactor fuel for weaponization was “unfeasible”, at least without detection.29

Between 1979 and 1981 a number of developments slowed down the nuclear program, categorized in this chapter as the first period of nuclear restraint. First, sabotage attacks on the

Tammuz I and II reactors while under construction in France delayed their delivery. Second, following the 1979 Islamic Revolution in Iran, the Iraqi leadership imprisoned two key nuclear scientists due to suspected Shiite loyalties. And finally, in 1981 Israeli jets destroyed the

Tammuz I reactor before it became operational. Despite Iraqi efforts, the Tammuz I was never rebuilt due to difficulties obtaining external assistance.

After the Israeli strike, in the early 1980s Iraq adopted a different strategy based on uranium enrichment. It launched several projects including EMIS (electro-magnetic isotope separation), gaseous diffusion, laser enrichment, centrifuge, and chemical methods. From 1982 until the

Gulf War of 1991 it made tremendous progress in EMIS and centrifuge technology, but had not yet begun industrial-scale enrichment. At the same time Iraq did not abandon the plutonium route to nuclear weapons. In 1981 Iraq secretly tried to obtain a large heavy water reactor from

Italian suppliers.30 It sought to reprocess plutonium from the spent fuel of the IRT-5000. Iraq

27 They were supposed to remain on site until 1989, but most left after the start of the Iran-Iraq war in 1980.

28 Spector, Nuclear Proliferation Today, 169-170.

29 Braut-Hegghammer, “Revisiting Osirak”, 111; Reiter, “Preventive Attacks”, 359-361; Spector, Nuclear Proliferation Today, 178-180. The IAEA conducted its first inspection in June 1980, when the first and only shipment of HEU fuel from France arrived. In January 1981, a second inspection was carried out during the Iran- Iraq war. On both occasions the Agency verified the fuel assemblies and the absence of diversion for weapons purposes. The plan was to increase the frequency of inspections to once every two weeks when more fuel arrived. Hans Gruemm, “Safeguards and Tamuz: Setting the Record Straight”, IAEA Bulletin, 23 (4), 1981, 10-11.

30 Spector, New Nuclear Nations, 164.

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separated about 5 grams of plutonium and recovered about 11 kg of uranium between April

1988 and April 1990 in the hot cells at Tuwaitha.31

Weapons Program

Until 1981 the Iraqi nuclear program lacked a dedicated budget, organizational structure, and strategic plan to develop nuclear weapons.32 In September 1981, soon after the Israeli attack, Iraq launched a nuclear weapons program headed by Dr. Jafar Dhia Jafar centered at an office called Directorate 3000 at Tuwaitha.33 The aim was to produce fissile material through a variety of enrichment methods, the most important being EMIS (electro-magnetic isotopic separation).34 Despite a tremendous increase in funding,35 the program did not make much progress until late 1987.36

31 International Atomic Energy Agency, Fourth Consolidated Report of the Director General of the International Atomic Energy Agency (Vienna: IAEA), October 7, 1997, 53-54.

32 Braut-Hegghammer, “Revisiting Osirak”, 107.

33 Jeffrey T. Richelson, Spying on the Bomb: American Nuclear Intelligence from Nazi Germany to Iran and North Korea (W. W. Norton & Company, 2006), 320.

34 Iraq tried several different methods for uranium enrichment, but faced some technical problems. For example the laser isotope program was hampered by the complexity of the technology and difficulty procuring special materials (IAEA 1997, 44-45); gaseous diffusion required a very large industrial infrastructure (IAEA 1997, 37). EMIS became the chosen method because information was easily available in the open literature and because Iraq could indigenously produce the basic materials (ISG 2004, Nuclear, 42; Albright 2010, 86).

35 Braut-Hegghammer, “Revisiting Osirak”, 117.

36 International Atomic Energy Agency (IAEA) Report, 1997, 54. As Braut-Hegghammer notes, between 1981 and 1987 “the political leadership remained detached” from the details of the nuclear program. She interprets this as a sign of lukewarm interest in nuclear weapons by the top leadership, arguing that scientists pushed the move to weaponization. Braut-Hegghammer, “Revisiting Osirak”, 105, 120. This chapter, however, maintains that although scientists were a critical element of the nuclear program, they did not initiate it, as evinced by the personal interest that Saddam Hussein took in the program – he travelled to Paris to negotiate the agreement resulting in the supply of two reactors; and as discussed below, in 1980 he communicated to leading scientists the desire to start a weapons program. The slow progress in the nuclear program until 1987 is rather explained by Hussein’s preoccupation with the war with Iran, which turned out to be the opposite of the decisive victory he had envisioned. For example in October 1980 Hussein talked of how the war could possibly stretch for a year, not anticipating that it would end only in 1988. Woodes et al, Saddam Tapes, 138-140; 144-146; 148-151. Within two months of the invasion Iraq already lost its momentum; soon after, Iran went on the counteroffensive. By May 1982 Iran had regained all its lost territory as well as inflicted heavy casualties on Iraq. Kenneth Pollack, Arabs at War: Military Effectiveness, 1948- 1991, (Lincoln: University of Nebraska Press, 2002), 193, 198-199. Between 1982 and 1986 Iran attacked Iraq 118

The start of the weapons program in 1981 was precipitated by the Israeli raid just three months prior.37 The attack is generally believed to have deepened the desire for nuclear weapons, and turned the direction of the program from plutonium production to uranium enrichment.38 In an apparent reference to the nuclear program, in late 1981 Saddam Hussein talked of how Israel and the Western nations were seeking to break Iraq psychologically or actually by targeting its “scientific and economic advancements, which are the main sources of

Iraq’s strength”.39 Soon after the Israeli attack, Hussein released Dr. Jafar Dhia Jafar from prison and charged him with leading a nuclear weapons program,40 which was headquartered at the newly established office Directorate 3000.

In the latter part of the 1980s, the security threat from Iran appears to have been the primary motivation for nuclear weapons.41 Saddam Hussein became convinced that weapons of mass

relentlessly, seeking to overthrow the Ba’ath regime. Pollack, Arabs at War, 203; Solingen, Nuclear Logics, 145. Duelfer (2009, 34-35) talks of how Iraqi officials viewed the large-scale human wave attacks by the Iranians as a form of unconventional warfare. Charles Duelfer, Hide and Seek: The Search for Truth in Iraq (New York: Public Affairs, 2009), 34-35.Thus the nuclear program made little progress until 1987 due to the war with Iran, rather than due to any evident decline in the desire for nuclear weapons.

37 Braut-Hegghammer, “Revisiting Osirak”, 115-116.

38 Cirincione et al, Deadly Arsenals, 331; Charles Duelfer, interview, 2009; Khidir with Jeff Stein, Saddam’s Bombmaker: The Terrifying Inside Story of the Iraqi Nuclear and Biological Weapons Agenda (New York: Scribner, 2000), 130; Iraq Survey Group Report, Nuclear, 3; Kelley, “Iraqi and South African Nuclear Weapons Programs”, 28; Rhodes, Twilight of the Bombs, 15.

39 Woods et al, Saddam Tapes, 227.

40 The circumstances surrounding Jafar’s arrest and release are discussed later in the chapter.

41 Mahdi Obeidi (former head of Iraq’s centrifuge program), phone interview by author, February 2, 2012; Solingen, Nuclear Logics, 147. Differences with Iran had grown after the Iranian Revolution of 1979. The new Islamic regime in Iran, which established a fundamentalist religious state, differed vastly from Ba’athist Iraq, which believed in a secular nation-state. Unlike the Islamic Republic, the Iraqi state encompassed Islam within the notion of pan- Arabism. Seizing what he perceived to be a weakened regime under transition, Saddam Hussein sent Iraqi forces to invade Iran in 1980. Saddam Hussein also viewed the war as a continuance of the age-old conflict between Arabs and Persians. William R. Polk, Understanding Iraq (I B Tauris, 2005), 129. In addition Hussein sought to redress the perceived wrongs of a 1975 treaty with Iran, in which Iraq ceded some crucial territory in return for Iranian non- interference with Iraqi Shia. Quite contrary to Hussein’s expectations of a quickly achieved victory, the war dragged on for eight years, ultimately ending when Iran accepted a UN Security Council-sponsored ceasefire in 1988.

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destruction had been crucial in Iraq’s survival -- Iraq had used chemical weapons during the war.42 Added spurt to the nuclear program in the late 1980s appears to have come from suspicions of an Iranian nuclear effort.43 In a 2004 interview with the FBI, Saddam Hussein stated his belief that Iran was still the biggest threat to Iraq, specifically the danger that Iran would annex southern Iraq.44 As the following paragraph delineates, the weaponization effort became concretized in 1987-1988.

In 1987 Department 3000,45 where the nuclear program was centered, was renamed

Petrochemical 3 or PC-3 to prevent external suspicion.46 Saddam Hussein’s son-in-law Hussein

Kamel, who was also Minister of Industry and Military Industrialization, was put in charge of the reinvigorated weapons effort at PC-3 in January 1989.47 The PC-3 office was divided into four groups, each tasked with a different function – Group One for centrifuge development under Mahdi Obeidi, Group Two for EMIS enrichment under Jafar Dhia Jafar, Group Three for engineering and manufacturing as well as administrative support under Dhafar Selbi, and Group

Four for bomb design and weaponization under Khidir Hamza and later Khalid Said.48 Thus the weaponization effort took independent shape as Group Four within the PC-3 in 1988.49 Its

42 Iraq Survey Group Report, Vol. 1, 24.

43 Duelfer, interview, 2009; Iraq Survey Group Report, Vol. 1.

44 He also discussed his view that a key factor by which Iraq was able to avoid defeat was by its superior missiles, which were effectively used against Tehran in 1987-1988. Joyce Battle, NSA Electronic Briefing Book No. 279, Saddam Hussein talks to the FBI, June 11, 2004.

45 Directorate 3000 at Tuwaitha was renamed Department 3000, before subsequently becoming PC-3.

46 Richelson, Spying on the Bomb, 323.

47 IAEA Report, 1997, 54.

48 Richelson, Spying on the Bomb, 323.

49 Note by the Secretary-General to the Security Council, December 1, 1995, S/1995/1003, 4.

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activities were first conducted at the IAEC at Tuwaitha and moved to a new site at Al Atheer in

May 1990.50 Iraq made significant progress and even selected a site in southwestern Iraq for the purpose of testing nuclear weapons underground.51

After the invasion of Kuwait in August 1990 Iraq launched a “crash program” to quickly develop a nuclear weapon, in the hope of deterring an international military attack. It was directed by Hussein Kamel and was revealed to UN inspectors only after Kamel’s defection to

Jordan in 1995.52 The crash program was based on diverting fuel from the two research reactors at Tuwaitha (the Soviet-supplied IRT-5000 and the French Tammuz II) and enriching it to weapons-grade level using a centrifuge cascade. According to this plan, Iraq would have extracted, from the fresh reactor fuel, about 25kg HEU with an average enrichment of 86% by

April 1991.53 This would have been sufficient to produce a “single low-yield nuclear device”.54

According to the Iraqis, it would not have been possible to test/deploy a nuclear device/weapon before the end of 1992.55 In any case, the IAEA believed that the crash program based on commissioning 50 centrifuges in six months was “wildly optimistic”, since fabricating

50 IAEA Report, 1997, 54-56.

51 IAEA Report, 1997, 56. The PC-3 focused on the implosion design fueled by HEU since it required much less HEU than the gun-type design, which was initially considered. It obtained much of the relevant information from open literature. Note by the Secretary-General, December 1995, 14.

52 The past existence of a nuclear weapons program and its details were revealed only after Kamel’s defection, when inspectors were led to what was claimed to be Kamel’s chicken farm, containing troves of documents relating to the nuclear and other WMD programs.

53 It would have further extracted HEU from irradiated fuel by October 1991. Note by the Secretary-General, December 1995, 3

54 Note by the Secretary-General to the Security Council, October 6, 1995, S/1995/844, 6.

55 Note by the Secretary-General, December 1995, 3.

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centrifuges is a delicate technical task and Iraq would have to rely on a mix of indigenous and imported materials.56

In just three months, by December 1990, Iraq had constructed a small reprocessing plant to extract HEU from reactor fuel. It had not actually started extracting HEU by the time the Gulf

War began in January 1991.57 The reprocessing plant was seriously damaged during the war, after which it was redesigned for the purpose of being installed at a new location, Al Tarmiya.58

By the time of the war, Iraq had not built the 50-machine centrifuge cascade, although it had formulated the design and allocated space for the cascade at Rashdiya.59 To produce uranium metal for weapons fabrication, Iraq produced a test amount of 10kg uranium tetrafluoride by late

1990. But the project to convert HEU to uranium metal was also damaged in the war.60 Thus, although the crash program was not close to producing a nuclear weapon by the time of the Gulf

War, it was set to make progress at producing fissile material.

Given the definition of nuclear restraint as used in the dissertation – the slowing, stopping, or reversal of a nuclear weapons program -- the Iraqi nuclear program underwent four phases of restraint, as summed up in the following table.

56 IAEA Report, 1997, 47, 50.

57 IAEA Report, 1997, 51.

58 IAEA Report, 1997, 49.

59 Note by the Secretary-General, December 1995, 10. The centrifuge program made tremendous program under the leadership of Mahdi Obeidi. Begun in 1987, the program succeeded in building two oil-bearing centrifuges by 1989 and two magnet-bearing centrifuges by mid-1990. It also tested one magnet-bearing centrifuge with uranium hexafluoride. Iraq Survey Group Report, Nuclear, 7). Obeidi obtained published designs from the Manhattan Project and, as described later in the chapter, received information and technology from various Western sources, particularly a German firm. Mahdi Obeidi and Kurt Pitzer, The bomb in my Garden: The Secrets of Saddam’s Nuclear Mastermind, (Hoboken, New Jersey: John Wiley & Son, Inc., 2004; Note by the Secretary-General, December 1995, 11.

60 IAEA Report, 1997, 50-51.

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Table 4.1 Iraq’s nuclear program

Time Nuclear Program 1950s-1979 Pursuit 1979-1981 Restraint 1 (Slow) 1982 -January 1991 Pursuit January - February 1991 Restraint 2 (Rollback) March-April 1991 Restraint 3 (Slow and Stop) May 1991-1998 Restraint 4 (Rollback) 1998-2003 Continued Restraint (nuclear program absent)

Restraint I (Slow) 1979-1981

Between 1979 and 1981 a number of sabotage and military attacks damaged the Tammuz I reactor, eventually destroying it before it became operational. These attacks decidedly slowed down the nuclear program. In addition the regime imprisoned two of its leading scientists associated with the program due to suspicions of Shiite loyalties in the context of the Iranian

Revolution of 1979. This also contributed to slow growth in the program.

Restraint in the Iraqi nuclear program appeared for the first time in April 1979 when bomb explosions caused hairline fractures to the reactor cores of the Tammuz I and II in France while awaiting shipment to Iraq.61 This set back the nuclear program by about six months, with France delivering the cores in late 1979.62 In the summer of 1980 there were further attacks on supplier sites in France and Italy.63 In June Dr. Yahya el-Meshad, an Egyptian nuclear scientist working

61 Israel was widely speculated to be behind the bombings (Spector 1984, 176; Richelson 2006, 321).

62 Spector, Nuclear Proliferation Today, 176.

63 A series of bombings in August 1980 targeted the residences and offices of suppliers including the offices and apartment of the director-general of SNIA-Techint, the Italian company supplying hot cells; another Italian firm Ansaldo Mercanico Nucleare; and the French government-owned subsidiary Techniatome. Several threatening letters were also sent to employees at other French and Italian companies assisting the Iraqi nuclear program. Israel is widely speculated to have been behind the attacks. Snyder, “Iraq”, 22; Richelson, Spying on the Bomb, 321.

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for the Iraqi Atomic Energy Commission was killed in Paris where he had gone to inspect the shipment of reactor fuel.64

Besides these sabotage attacks, a second element constraining the nuclear program in this period was the imprisonment of two important Iraqi scientists. Soon after the Iranian

Revolution, the Iraqi government arrested the person in charge of the reprocessing laboratory,

Dr. Hussein Shahristani, for alleged support to a Shiite movement.65 When his colleague Dr.

Jafar Dhia Jafar, vice chairman of the IAEC, protested, he too was arrested.66 According to

Braut-Hegghammer this brought the nuclear program to a “standstill”.67

A third element of restraint in this period arose from military attacks on nuclear facilities.

A few days after the start of the Iran-Iraq war in September 1980, two Iranian fighter jets attacked Tammuz I while it was still under construction, bringing minimal damage to the dome and cooling system. This further delayed the operation of the reactors by another six months.68

The most lasting impact of nuclear restraint in this phase was an Israeli attack on the

Tammuz I in June 1981. The Israeli Air Force dropped a total of sixteen 2000-pound bombs on the reactor-complex, completely destroying the Tammuz I reactor before it began operating.69

Negotiations with France to rebuild the reactor continued until 1984, when it became evident

64 Spector, Nuclear Proliferation Today, 176.

65 Braut-Hegghammer, “Revisiting Osirak”, 108-109.

66 Richelson, Spying on the Bomb, 319. Both Shahristani and Jafar were Shi’te. Weissman and Krosney, Islamic Bomb, 251-253. Shahristani remained imprisoned from 1979 until 1991, while Jafar was released in 1981, when he agreed to help develop nuclear weapons. Braut-Hegghammer, “Revisiting Osirak”, 109.

67 Braut-Hegghammer, “Revisiting Osirak”, 109.

68 It was supposed to start operating in December 1980. Spector, Nuclear Proliferation Today, 177.

69 Frank Barnaby, The Invisible Bomb: The Nuclear Arms Race in the Middle East (London: I B Tauris & Co. Ltd., 1989), 88; Snyder, “Iraq”; Rhodes, Twilight of the Bombs, 15.

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that France would not reconstruct it.70 Spurred by American and Israeli concerns about Iraqi interest in nuclear weapons, Italy announced an end to its nuclear cooperation with Iraq in late

1982.71 As discussed later in this chapter, the Israeli attack likely placed additional financial restrictions on the program, which now required new funds to reconstruct the reactor.

All in all, the Israeli attack and its consequences eliminated a key element of Iraq’s nuclear program as the reactor was never rebuilt. Its impact likely lasted several years after the event – it effectively curbed Iraq’s plutonium reprocessing capability. Nevertheless I classify the nuclear program as undergoing a phase of restraint only up till 1981 since, after that point, Iraq launched a number of uranium enrichment projects and formally initiated a weapons program.

Specifically, Iraq started a secret nuclear weapons program based on uranium enrichment in

September 1981, just months after the Israeli attack.72 The new effort began with the release of

Jafar Dhia Jafar in September, and a significant increase in funding for the program.73 The same month, Jafar established Directorate 3000 at the Tuwaitha Nuclear Research Center, the office in charge of the new nuclear weapons program.74

70 IAEA Report, 1997, 53.

71 Spector, Nuclear Proliferation Today, 183. One important reason for this change in the French and Italian positions appears to be the significant decline in the supply of Iraqi oil after the start of the war with Iran. Snyder, “Iraq”, 12-13. It may also have been driven by American pressure since the late 1970s as well as Israeli warnings that it would not hesitate to undertake further such attacks in the future. Shai Feldman, “The Bombing of Osirak- Revisited”, International Security, 7 (2), 1982, 126; Samore, “Iraq”, 17.

72 Braut-Hegghammer, “Revisiting Osirak”, 115.

73 According to Reiter the program increased from 400 scientists and $400 million to 7,000 scientists and $10 billion. Braut-Hegghammer notes that the staff increased by 60 percent annually from 1983 until 1991, and that it received “abundant and consistent funding” since September 1981, when Jafar returned to the Tuwaitha Nuclear Research Center. Reiter, “Preventive Attacks”, 362; Braut-Hegghammer, “Revisiting Osirak”, 117.

74 Braut-Hegghammer, “Revisiting Osirak”, 117.

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Restraint I: Motivational or Resource Driven?

The arrest of two lead scientists in 1979-1980 would seem to suggest that the Iraqi leadership was not sufficiently motivated to pursue a nuclear weapons program.75 However this section argues that this is not the case, and that Restraint 1 was caused by resource constraints, which included sabotage and military attacks, rather than motivational factors.

First, the absence of a formal or declared nuclear weapons program does not indicate the lack of motivations to develop nuclear weapons or a weapons capability. The Iraqi nuclear program, at least until 1981, was moving toward acquiring a reprocessing capability using the spent fuel from Tammuz I. In the latter half of the 1970s Iraq had serious negotiations with

France and Italy, culminating in the delivery of nuclear technology in the late 1970s – the combination of the Tammuz I from France and the reprocessing lab from Italy could poise Iraq for a capability to reprocess plutonium. The fact that these two legs of a reprocessing capability were proceeding simultaneously suggests an interest in weaponization. In addition to the Soviet- supplied reactor fuel (10 kg of 80% enriched fuel made available in 1978) and the French- supplied fuel (11.8 kg of 93% enriched fuel supplied in June 1980), in this period Iraq was also importing natural uranium and acquiring lab-scale fuel fabrication capability from Italy.76

Moreover, there is some evidence that Saddam Hussein desired a nuclear weapons capability in this period (1979-1981). In 1979 Saddam Hussein attempted to obtain components or even a

75 As Braut-Hegghammer states: “…despite having made the explicit decision to pursue nuclear weapons Saddam kept his chosen bomb-maker imprisoned.” Malfrid Braut-Heggahmmer, Nuclear Entrepreneurs: Drivers of Nuclear Proliferation, Ph.D. thesis. Department of International Relations. London School of Economics, 2010, 63.

76 Spector, Nuclear Proliferation Today, 170; Rhodes, Spying on the Bomb, 15. Between 1979 and 1982 Iraq imported various forms of natural uranium, slightly enriched uranium (enriched to 2.6%), and depleted uranium fuel from Brazil, Niger, Portugal, and Italy. IAEA Report, 1997, 27; Spector, Nuclear Proliferation Today, 171-172.

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nuclear weapon from the Soviet Union.77 In a meeting with senior advisors in late 1981 he discussed the need for a deterrent against both Israel and Iran.78 He was conscious that not having a nuclear capability meant that Arabs could be subject to “blackmail” to get political concessions under a nuclear threat.79 Thus in the early 1980s Saddam Hussein viewed nuclear weapons capability as essential for Iraq’s security primarily against Israel80 but also against Iran.

At the same time, Hussein also articulated offensive gains that would be within his reach with a nuclear capability – regaining the territories lost to the Arabs in the 1967 war. According to Hal

Brands and David Palkki, Saddam Hussein “expressed various versions of this logic between

1978 and 1981.”81 Clearly then, the motivations for nuclear weapons existed at this time.

Second, after the bomb explosions in France, Iraq chose to receive the damaged reactor cores (after some repairs) rather than wait the two years that the French estimated it would take to rebuild them.82 Thus the leadership opted for damaged reactors with unrepaired hairline

77 Baram, “Analysis of Iraqi WMD Strategy”, 28; Hal Brands and David Palkki, “Saddam, Israel, and the Bomb: Nuclear Alarmism Justified?”, International Security, 36 (1), 2011, 147, 149. Hussein later talked of this attempt: “…we contacted some friendly countries [to acquire] a type of weapon that will make Israel hesitate if it decided to carry out such an attack against Iraq.” He was referring to a likely Israeli attack against “Iraq’s vital facilities,… will target main rings that will stop development or will stop Iraqi prosperity in the programs of scientific and economic advancements…”Woods et al, Saddam Tapes, 227.

78 Hussein stated, “…So we have to have this protection for the Iraqi citizen so that he will not be disappointed and held hostage by the scientific advancement taking place in Iran or in the Zionist entity. The Iraqi citizen must have sufficient protection with simple means. In addition, the issue of deterrent capability… is not a provocative, hostile action… Without such deterrence, the Arab nation will continue to be threatened by the Zionist entity and Iraq will remain threatened by the Zionist entity.” Woods et al, Saddam Tapes, 226.

79 Woods et al, Saddam Tapes, 226.

80 He talked of his fear that Israel “will exceed its limits, crossing the lines of Arab countries on its borders and will attack us in Iraq with its air force. That it will bomb our vital economic facilities, and will attack our petroleum facilities, and therefore,… we reckoned that we have to have defensive means to carry out defensive actions ” (Woods et al 2011, 227). The urgency of the security threat from Iran appears to have strengthened in the late 1980s.

81 Brands and Palkki, “Saddam, Israel, and the Bomb”, 148. Saddam Hussein talked of a war of attrition, possibly undertaken jointly with Syria and Jordan to regain lost territories. Woods et al, Saddam Tapes, 223.

82 Rodger Claire, Raid on the Sun: Inside Israel’s Secret Campaign that Denied Saddam the Bomb, (Broadway, 2004), 49; Hamza and Stein, Saddam’s Bombmaker, 110

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fractures instead of causing a delay of two years. This also suggests a deep interest in preserving the pace of the program.

Third, the arrest of the Iraqi scientists speaks more about the regime’s style of functioning rather than a decline in motivations for the nuclear program – the Ba’ath regime under Saddam Hussein, who became President in 1979, ran on a powerful psychological and organizational structure of reward and punishment.83 The regime used intimidation to motivate the scientists (Obeidi and Pitzer 204, 129) – Shahristani was arrested for suspected loyalty; Jafar for commiserating with his family.84 In June 1980, about six months after their arrest, Hussein conveyed to the two scientists (while still imprisoned), his desire to develop nuclear weapons – he sought to enlist their help while they were still incarcerated.85 Hussein understood that people had multiple identities and used a compelling mix of reward and punishment to wield power.86

In later years another scientist – Dr. Mahdi Obeidi, who headed the centrifuge program – would experience a moment of fear that he or his family may meet a similar fate if he did not comply with Hussein’s directives on the nuclear program. At the same time, Obeidi and his centrifuge staff were rewarded with new cars and sums of money when they first successfully enriched uranium with a centrifuge.87

83 Amatzia Baram, “Saddam’s Power Structure: The Tikritis Before, During and After the War” in Toby Dodge and Steven Simon, edited, Iraq at the Crossroads: State and Society in the Shadow of Regime Change (International Institute for Strategic Studies), Adelphi Paper 354; Tripp, History of Iraq, 260.

84 Obeidi and Pitzer, Bomb in my Garden, 46, 129, 204.

85 Baram, “Analysis of Iraqi WMD Strategy”, 28; Braut-Hegghammer, “Revisiting Osirak”, 109.

86 Charles Duelfer (former Special Adviser to the Director of Central Intelligence for Iraqi WMD and former Deputy Executive Chairman of UNSCOM), interview by author, October 7, 2009, Maclean, Virginia.

87 Obeidi and Pitzer, Bomb in my Garden, 95, 129-130.

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The imprisonment of the scientists was driven by Saddam Hussein’s concerns about domestic security following the Iranian revolution. Since the Sunni minority ruled the majority

Shia in Iraq, he had reason to fear that the Shiite Islamic revolution in neighboring Iran would have spillover effects in Iraq.88 Thus in 1979 the nuclear program took a temporary backseat to more pressing domestic problems; Saddam Hussein did not give up his nuclear ambitions.89

Since motivations for nuclear weapons continued, Restraint 1 must have been brought about by resource constraints.90 The following section assesses the role of sanctions in leading to these resource limitations in 1979-1981.

Sanctions and Restraint 1

In this first period of restraint, Iraq did not face comprehensive or multilateral sanctions; instead it was subject to some US sanctions by virtue of its designation as a state sponsor of terrorism. In December 1979 the Carter administration placed Iraq on the first list of State

Sponsors of Terrorism due its support for the PLO.91 This automatically entailed sanctions on

US foreign aid, the export of military and dual-use items, and US support for international loans. By virtue of its designation as a sponsor of terrorism, Iraq was also subject to export

88 Charles Duelfer and Stephen Benedict Dyson, “Chronic Misperception and International Conflict: The US-Iraq Experience”, International Security, 36 (1), 2011, 83.

89 Braut-Hegghammer, Nuclear Entrepreneurs, 62; Braut-Hegghammer, “Revisiting Osirak”, 108-109.

90 As argued in the theory chapter, nuclear restraint must necessarily be caused by either resource-related factors or a change in leadership motivations favoring restraint (or both). The former include any factors, including military strikes and other such elements that limit the physical capability to pursue nuclear weapons. The latter can occur through myriad factors broadly categorized as the security, domestic politics, or prestige models. In the security and prestige models, the leadership calculates the benefits in external security and international status that would accrue from restraint; in the domestic model, the leadership undertakes restraint due to changing domestic coalitions that favor restraint or due to domestic pressures on regime survival.

91 The United States had not had diplomatic relations with Iraq since 1967, when, along with other Arab countries, Iraq severed bilateral relations following the Arab-Israeli war. Bernard Gwertzman, “US Restores Full Ties With Iraq But Cites Neutrality in Gulf War”, New York Times, November 27, 1984.

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controls, which were most recently elaborated in the Export Administration Act of 1979.92

These were the only sanctions on Iraq at the time. The United States removed Iraq from the terrorism list and lifted sanctions in March 1982 soon after the Reagan administration came to power. The move was driven by the desire to reduce Soviet influence and prevent an Iranian victory.93

What role, if any, did sanctions play in Restraint 1? The following section assesses whether sanctions contributed to resource constraints in this period. The possible ways in which sanctions may have been influential are by: (i) limiting access to technology, and (ii) limiting the financial resources available for the program.

Technology Denial

The US sanctions on Iraq from 1979 to 1982 would have directly impacted the nuclear program had Iraq been receiving nuclear assistance from the United States. However, since this was not the case, the US sanctions did not inflict direct technology denial. Instead, sanctions could have constrained the program by denying export licenses to Iraq’s principal suppliers of nuclear technology at the time --- France and Italy. Italy’s supply of a reprocessing lab became controversial in the United States in March 1980, when it was publicly revealed in a New York

Times article.94 This generated much concern since Iraq was considered a sponsor of terrorism.

Another example of the inconsistency with which export controls were applied is the controversy over US export licenses for Italy’s sale of naval frigate engines in 1980. The sale of

92 The Act required a “validated license” if it were determined that exports made a “significant contribution to the military potential” of Iraq (and other countries determined to be ‘repeatedly’ supporting terrorism) -- Export Administration Act, Pub. L No. 96-72 (1979), Section 6(j)(1).

93 O’Sullivan, Shrewd Sanctions, 106.

94 Snyder, “Road to Osirak”, 575.

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eight engines required export licenses since they contained parts manufactured by General

Electric (GE). The Commerce Department granted GE these export licenses in January 1980, only to suspend them in February 1980.95 In April Secretary of State Cyrus Vance and National

Security Adviser Zbignew Brzenski supported the sale for the purpose of improving relations with Iraq.96 Members of Congress were enraged and accused the administration of breaking the law, particularly in its failure to inform Congress before granting the licenses. After the start of the Iran-Iraq war in September 1980, the administration blocked the shipment of the remaining six engines (two having been shipped already). Finally, in deference to a State Department request, in December 1980 GE decided not to ship these remaining engines even though it had a valid export license.97 It was unclear whether the sanctions or export controls specifically prohibited this transaction – the main objection by Congressional members was to not being informed.98 A review by the GAO concluded that the export license to GE was “technically in compliance” with the Export Administration Act of 1979.99

95 The cancellation occurred under congressional pressure. Members of congress argued that the GE sale violated Section 6(j) of the Export Administration Act of 1979, according to which the Commerce and State Secretaries were to inform Congress before granting such licenses -- Hearing before the Subcommittees on Europe and the Middle East, and on International Economic Policy and Trade, of the Committee on Foreign Affairs House of Representatives , 96th Congress, Second session, May 14, 1980.

96 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM.

97 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM.

98 Administration officials argued that the decision to grant the licenses was made on several considerations, including “the availability of comparable equipment from foreign sources” – a consideration specifically mentioned in the Export Administration Act under Section 4(c). Assistant Secretary of State Deane Hinton justified the administration’s decision by arguing that Iraq would have been able to obtain the items from other sources, denying export licenses would have resulted in the loss to the United States of a deal valued at $11 million, US-Italian relations would have been adversely affected, and Iraq would not succeed in diversifying its supply sources away from the Soviets -- Statement by Dean R. Hinton, Assistant Secretary for Economic and Business Affairs, Department of State, Hearing before the Subcommittees on Europe and the Middle East, and on International Economic Policy and Trade, of the Committee on Foreign Affairs House of Representatives , 96th Congress, Second session, May 14, 1980.

99 Licensing for Export of Turbine Engine Cores to Italy for Use in Iraqi Frigates, B-200643, Dec 9, 1980, US Government Accountability Office, accessed June 19, 2012, http://www.gao.gov/products/B-200643.

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The tension between Congress, which attempted to reduce US commercial relations with

Iraq, and the administration, which sought to continue such links, was also seen in the State

Department’s approval of the sale of Boeing commercial jets to Iraq in early August 1980.

Again, as in the case of the naval frigates, the deal was cancelled when the administration succumbed to Congressional pressure in late August 1980.100

These variations in American decisions to continue or cancel sales to Iraq were driven by political pressure rather than by the imposed sanctions, which had remained constant between late 1979 and March 1982. Indeed, it is striking that the sanctions did not result in a sure denial of technical exports as the executive and legislative branches of the US government debated whether the sanctions included particular items.101

During 1979-1981, the US sanctions did not have the scope to deny export licenses to

France (regarding the French nuclear cooperation with Iraq) as France had become a major nuclear supplier and was not itself dependent on American supplies.102

Therefore the resource constraints facing Iraq at the time were principally in the form of attacks on facilities and personnel rather than as technology denial by suppliers.103 I make this conclusion because much of the supply of nuclear technology to Iraq (mainly by France and

100 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM.

101 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM.

102 Congressional Research Service (Environment and Natural Resources Policy Division), Analysis of Six Issues about Nuclear Capabilities of India, Iraq, Libya, and Pakistan, prepared for the Subcommittee on Arms Control, Oceans, International Operations and Environment of the Committee on Foreign Relations, US Senate, January 1982, GAO, 43, 54-55.

103 One small exception was the denial of US export licenses to a German firm NUKEM for depleted uranium fuel. Iraq had ordered 25,000 pounds of depleted uranium fuel pins, sized to fit Tammuz I -- possibly for irradiation in Tammuz I to produce plutonium. Leonard Spector with Jacqueline Smith, 1990, 187. The attempt failed when NUKEM subcontracted portions of the deal to Canadian and American firms, which led to export denial. Spector, Nuclear Proliferation Today, 173.

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Italy) as agreed to in the late 1970s was in fact carried through.104 In fact American pressure on both France and Italy to refrain from the sale of technology and equipment appears to have largely failed, apparently driven by French and Italian interest in Iraqi oil.105

Financial Constraints

Financial issues did not significantly affect the nuclear program until late 1980 when the effects of the Iran-Iraq war, which began in September 1980, translated into a visible economic impact best seen in the decline in oil production. In June 1980 when Saddam Hussein communicated his desire for nuclear weapons to Shahristani and Jafar, Iraq was at the peak of its national income following the oil crises of the 1970s. As the graphs below show, GDP registered a significant decline in 1981. This is principally attributed to the war,106 which disrupted oil production and exports.107

104 It is true that France denied the original Iraqi request for a large gas-graphite reactor, and France also limited the amounts of HEU fuel available at a time as well as placed other restrictions. It did, however, carry through with agreements to make these available, contributing to a much more advanced Iraqi nuclear program in the late 1970s. The same is true with Italian cooperation during this period.

105 Spector, Nuclear Proliferation Today, 170-171; Snyder, “Iraq”, 12-13; France and Italy each imported from Iraq about 21 % and 24% of their total OPEC oil imports respectively. Snyder, “Road to Osirak”, 573-574.

106 Real GDP growth fell from 23.5% in 1979 to 2.1 % in 1980, and fell drastically to -44.3% in 1982. Economist Intelligence Unit, Country Profile Iraq, 1988-1989, 15.

107 Economist Intelligence Unit, Country Profile Iraq, 1988-89, 27.

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Figure 4. 1 Iraq’s GDP 1970-1982

Figure 4. 2 Iraq’s oil production and exports 1970-1982

Source: Plotted based on data from OPEC Annual Statistical Bulletin, various years

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The Tammuz I reactor complex cost an estimated $300 million, which Iraq was willing and able to pay in the late 1970s.108 However, having to reconstruct it after the Israeli raid likely placed financial strain on Iraq especially in the context of the ongoing war with Iran. An indication of this is seen from the fact that Iraq turned to Saudi Arabia for financial help in reconstructing the reactor soon after the Israeli raid.109 Thus Iraq’s financial constraint in reconstructing the Tammuz I was a repercussion of the war with Iran, which reduced oil income.

The issue of having to rebuild the reactor itself arose due to military action by Israel. Hence sanctions, which in any case covered only military equipment, aid, and international loans, were not the cause of economic constraints in Restraint 1.

Conclusion: Sanctions and Restraint I

The US sanctions on Iraq between December 1979 and March 1982 arose by virtue of its place on the first list of State Sponsors of Terrorism. Hence they were limited to a ban on the export of military and dual-use items, foreign aid, and the blocking of international loans. The sanctions were not aimed at convincing Iraq to eschew nuclear weapons development and appear to have had no such effect. They also do not seem to have imposed resource constraints on the nuclear program.110

108 Solingen, Nuclear Logics, 158.

109 Saudi Arabia agreed to finance the project during a visit by the Iraqi foreign minister to Riyadh in July 1981. “Saudis will Pay for Repairs on Iraq’s Reactor.” New York Times. July 17, 1981.

110 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM.

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Table 4. 2 Summary of Iraq’s nuclear restraint (slow) in 1979-1981

Causes of restraint Present? Resource Constraints: Techological No Did sanctions impose significant resource constraints on NW Financial No program? Motivational Changes: Security No Did sanctions induce motivational changes in NW program? Domestic Politics No

Prestige No

However, the absence of sanctions since 1982 appear to have played a role in Iraq’s renewed weapons program in the 1980s. As the following section shows, some of the progress in the nuclear weapons effort would have been delayed or obstructed if sanctions had been present.

Nuclear Pursuit 1982-1990

In the 1980s, Iraq increased its efforts on the nuclear program and moved close to producing fissile material by the end of the decade. However, progress was not rapid as Iraq encountered some resistance on the part of nuclear suppliers.111 After officially establishing the nuclear weapons program in September 1981, it launched a number of uranium enrichment programs including EMIS, gaseous diffusion, laser enrichment, centrifuge, and chemical methods. The most advanced were the EMIS program begun in 1982 and the centrifuge project, which started in 1987. Although plagued by some technical inefficiency,112 the EMIS effort envisaged two

111 After the Israeli attack of 1981, the French were hesitant to rebuild the Tammuz I reactor; negotiations finally broke off in 1984. Italy also ended its nuclear cooperation by the mid-1980s. Iraq eventually set up its own clandestine supply network, especially for the centrifuge program that advanced quickly in the late 1980s.

112 By 1991, the EMIS project had succeeded in producing only 640 grams of uranium enriched to 7.2%, and another 685 grams of uranium enriched to about 3%. This was far below the aim for each large-scale facility to produce 15kg HEU (i.e. uranium enriched to 20% or more) annually. The IAEA observed that the installed separators worked only at 20% of their design capacity. IAEA Report, 1997, 35-36. Hence one inspector observed that the EMIS effort was a “spectacular failure” when measured against the resources poured into it. Kelley, “Iraqi and 136

industrial scale plants at Al Tarmiya and Al Sharqat meant to enrich to 20% and 93%.113 Iraq achieved some limited operation of EMIS technology by the time of 1991 war.114 According to

Robert Kelley, the nuclear program was characterized by inefficiencies due to scientists’ desire to incorporate pet projects and a tendency to exaggerate success to superiors.115 Apparently, the program was marked by “organizational inefficiencies”.116

The centrifuge effort was centered at an independent office called the Engineering Design

Center in 1987 under Dr. Mahdi Obeidi, who reported to Hussein Kamel. The goal was to produce 10kg of HEU (at 93% enrichment level) per year by 1994. The program grew rapidly, using clandestine sources from Germany and other European countries. Iraq tested its first centrifuge just a few months after the launch of the program.117

South African Nuclear Weapons Programs”, 28. Technical problems with the separators meant that large-scale enrichment would have been delayed. Nevertheless, given “sufficient time and expense”, Iraq is likely to have achieved its enrichment goals in the absence of the war, albeit delayed by “a year or two”. David Albright, “Iraq’s Programs to Make Highly Enriched Uranium and Plutonium for Nuclear Weapons Prior to the Gulf War”, ISIS Report, October 1, 2002 (Washington, DC: Institute for Science and International Security, 2002), accessed October 19, 2011, http://isis-online.org/isis-reports/detail/iraqs-programs-to-make-highly-enriched-uranium-and-plutonium- for-nuclear-we/9.

113 IAEA Report, 1997, 36.

114 Construction on the Tarmiya plant began in 1987 and was completed by the time of the Gulf War in January 1991, although it was not fully operational. Construction of the facility at al Sharqat was about 80% complete, but no process equipment was installed by the time of the war. Iraq Survey Group Report, Nuclear, 42; IAEA Report, 1997, 36.

115 Kelley, “Iraqi and South African Nuclear Weapons Programs”, 28-30.

116 Braut-Hegghammer, “Revisiting Osirak”, 121.

117 The main facility for large-scale production of centrifuges was at Al Furat, which the IAEA assessed as being capable of producing some 5,000 centrifuges a year. Apart from Al Furat, a second centrifuge facility was planned in the Taji area planned to hold 1,000 centrifuges. In late 1990 some 120 centrifuges were installed at Rashdiya as part of the ‘crash’ nuclear program. IAEA Report, 1997, 39, 41-42.

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Sanctions and Pursuit 1982-1990

The US sanctions on Iraq imposed in 1979 ended in March 1982, when the Reagan administration removed it from the terrorism list apparently due to its reduced support for

Palestinian groups.118 However, some new sanctions were imposed throughout the 1980s -- the

United States did not sell items on the Munitions Control List; in 1981 Congress prohibited direct aid to Iraq; starting in 1984, the Commerce Department barred the export of particular chemical substances that had possible uses in chemical weapons production; and in 1986

Congress prohibited indirect aid to Iraq.119 At the same time, the United States extended agricultural credits and technology supplies to Iraq in the late 1980s, and by 1990 Iraq was importing some $1 billion worth of US agricultural products.120

Did these incomplete sanctions support or obstruct Iraq’s nuclear program? The evidence suggests that, in the latter half of the 1980s, progress in the nuclear program was supported by

American assistance, while the sanctions did not significantly slow down the program. From

1984 to 1990 the United States approved exports to Iraq worth $96 million for high-speed

118 In reality, this was a reflection of the changing cold war politics, with Iraq distancing itself from the Soviet Union following its invasion of Afghanistan. Theodore W. Galdi and Robert D. Shuey, “US Economic Sanctions Imposed Against Specific Foreign Countries 1979 to the Present”, CRS Report for Congress, Revised September 9, 1988, 105; O’Sullivan, Shrewd Sanctions, 106, 110, 203.

119 Congress also sought to impose sanctions on Iraq in 1988 for its use of chemical weapons against the Kurdish population, but this was opposed by the Reagan administration. Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM.

120 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM; Christopher M. Jones, “Trading with Saddam: Bureaucratic Roles and Competing Conceptions of National Security” in Eugene R. Wittkopf and James M. McCormick, edited, The Domestic Sources of American Foreign Policy: Insights and Evidence, 3rd ed., (Lanham, Maryland: Rowman and Littlefield Publishers, Inc, 1999). Relations between the United States and Iraq improved under the Reagan administration, culminating in the reestablishment of formal diplomatic relations in November 1984. Gwertzman, “US Restores Full Ties”. In 1987 the State Department concluded a five-year trade agreement with Iraq; in 1988 President Reagan waived the ban on indirect aid; and in 1990 President Bush waived the ban on certain forms of direct aid.Galdi and Shuey, “US Economic Sanctions”,105-108; O’Sullivan, Shrewd Sanctions, 110.

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computers, and $1.5 billion sensitive technology, most of which was acquired by the IAEC.121 If the sanctions had continued, these licenses would almost certainly have been denied.122

The evidence also suggests that sanctions did not significantly slow down the Iraqi nuclear program in the 1980s. Instead, the hesitation of supplier countries in continuing cooperation with Iraq stemmed from developments related to the Iranian Revolution, the Iran-Iraq war, and the Israeli attack on Tammuz I. Iraq found it difficult to obtain nuclear technology from abroad after the Israeli strike; negotiations with Italy and France were suspended in 1982 and 1984 respectively.123 Discussions with France on rebuilding the reactor proceeded very slowly despite

Iraqi willingness to accept the new, stricter terms.124 French delay was caused by the ongoing

Iran-Iraq war as well as a change in the French government, with the Socialists, who were sympathetic to Israel, taking power in May 1981 less than three weeks before the Israeli attack.125 The French may also have been dissuaded by the arrest of Iraq’s top two scientists

Shahristani and Jafar, who had been active in the Tammuz project.126 France continued

121 Bruce W. Jentleson, With Friends Like These: Reagan, Bush, and Saddam 1982-1990. (New York: W. W. Norton and Company, 1994), 55, 62-64; Richelson, Spying on the Bomb, 350.

122 This suggests that the nuclear program may have slowed down if US sanctions had been present at this time, or at least that Iraq would have had to find alternate suppliers for dual-use technology.

123 After the Israeli raid nuclear suppliers like France and Italy may have been concerned about Israeli threats of future such attacks. Paul Power, “The Baghdad Raid: Retrospect and Prospect”, Third World Quarterly, July 8 (3), 860. Moreover, Iraq’s war with Iran meant that it was no longer a promising source of oil.

124 France required Iraq to fuel a reconstructed reactor using ‘caramel’ fuel (enriched only to 10%). Iraq accepted this and other “stringent technical conditions” (Dobbs 1984).

125 Michael Dobbs, “France Delays on Iraqi Reactor: Gulf War Holds Up Reconstruction of Facility Bombed by Israel”, Washington Post, December 3, 1984; Weissman and Krosney, Islamic Bomb, 11-12, 256.

126 Weissman and Krosney, Islamic Bomb, 255.

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negotiating with Iraq until 1984, when it became clear to the Iraqi authorities that it would not rebuild the reactor.127

A third possible source of nuclear technology for Iraq was the Soviet Union, which remained an important arms supplier. However the Soviets reportedly turned down Iraqi approaches for nuclear cooperation (beyond the small research reactor the IRT-5000) in the

1970s.128 In any case after the 1981 Israeli attack, it appears that the focus of the nuclear program shifted from seeking technology abroad to developing indigenous capabilities and skills.129 The difficulties in obtaining nuclear assistance therefore appear to have had little to do with sanctions.

Restraint in the 1990s

The next stages of Iraqi nuclear restraint occurred in the 1990s, when Iraq faced a comprehensive, universal sanctions regime unique in the history of sanctions. These were placed in response to its invasion of Kuwait in August 1990. Immediately after the invasion, the

United States imposed unilateral sanctions terminating all economic links with Iraq; these were soon followed by mandatory UN sanctions prohibiting all trade and financial transactions, barring the export of Iraqi oil and arms purchases.

The same day of the invasion of Kuwait, the United States declared a national emergency and banned all trade and financial transactions with Iraq except for humanitarian purposes. At the time, the United States was Iraq’s largest trade partner, receiving a third of its exports.130

127 IAEA Report, 1997, 53.

128 Power, “”Baghdad Raid”, 851.

129 Braut-Hegghammer, “Revisiting Osirak”, 119.

130 Economist Intelligence Unit, Country Report Iraq, 1996 first quarter, 3.

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Iraqi and Kuwaiti assets in the United States were frozen, affecting some $30 billion (most of it in Kuwaiti assets).131 The Bush administration rescinded hitherto approved licenses for US military exports132 and the Soviet Union also suspended all arms supplies. Iraq was returned to the State Department’s terrorism list in September 1990, banning export credits and placing strict controls on the export of US arms and related technology. In November 1990 Congress passed the Foreign Operations Appropriations Act, banning exports to Iraq of arms and nuclear equipment and technology, and cancelling Export-Import Bank credits and other such assistance.133

Just four days after the invasion of Kuwait, the Security Council passed Resolution 661 imposing such wide-ranging trade, arms, and financial sanctions that they have been called the

“most comprehensive” sanctions ever imposed by the UN.134 It was only the third time that the

Council was imposing such mandatory sanctions (the other two instances being Rhodesia and

South Africa). The sanctions were related to the UN demand on Iraqi forces to withdraw from

Kuwait.135 Thus at this point, they were not intended to enforce nuclear reversal or disarmament.

Resolution 661 of August 1990 entailed, among other things, a complete boycott of all Iraqi

(and Kuwaiti) goods and services, an embargo on commodity sales to Iraq and Kuwait, including weapons and other military equipment (excluding medicines and food in case of

131 Clyde H. Farnsworth, “Bush, in Freezing Assets, Bars $30 Billion to Hussein”, New York Times, August 3, 1990.

132 Restrictions on US indirect aid to Iraq had been lifted in 1988, and those on direct aid were terminated in January 1990. O’Sullivan, Shrewd Sanctions, 110.

133 O’Sullivan, Shrewd Sanctions, 110.

134 Jean E. Krasno, and James S. Sutterlin, The United Nations and Iraq: Defanging the Viper (Westport: Praeger, 2003), 142; Lopez and Cortright, “United Nations sanctions”, 113.

135 United Nations Security Council (SC), Resolution 660, “The situation between Iraq and Kuwait”, August 2, 1990, http://daccess-dds-ny.un.org/doc/RESOLUTION/GEN/NR0/575/10/IMG/NR057510.pdf?OpenElement, paragraph 2; United Nations Security Council (SC), Resolution 661, “The situation between Iraq and Kuwait”, August 6, 1990.

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humanitarian needs), and the prohibition of all financial transactions except those pertaining to the sale of food and medicine.136 In order to reduce the effects of the evolving humanitarian crisis in Iraq, since August 1991 the Council proposed schemes for the limited sale of Iraqi oil, but the Iraqi regime rejected these as a violation of its sovereignty.137

In another resolution, also in August 1990, the Security Council authorized members to use limited naval force to, among other things, inspect cargoes in order implement the sanctions.138 And in September 1990 the Council banned all flights to and from Iraq and Kuwait other than for humanitarian purposes.139

Following the failure to oust Iraqi forces from Kuwait, in January 1991 the United States and allies, under UN authorization, launched a six-week war to restore Kuwaiti sovereignty. The war ended in a ceasefire, whose terms were codified in Security Council Resolution 687 of

April 1991. The resolution was a victory for the coalition as it set far-reaching “terms of surrender” on Iraq.140 Indeed, Resolution 687 has come to be known as the “mother of all

136 United Nations SC, Resolution 661. Following a report by UN Under-Secretary General Martti Ahtisaari on the humanitarian crisis in Iraq, Security Council Resolution 687 of April 1991 permitted imports into Iraq of: food supplies, agricultural equipment, and other supplies like fertilizers, pesticides and veterinary drugs. Boutros Boutros- Ghali, “Introduction” in United Nations, The United Nations and the Iraq-Kuwait Conflict, 1990-1996 (New York: United Nations, 1996), 37.

137 In August 1991 the Security Council passed Resolution 706 authorizing the sale of Iraqi oil of up to $1.6 billion for six months mainly for funding humanitarian programs. The regime rejected this “oil-for-food” (OFF) proposal as it involved close monitoring by the UN-established Sanctions Committee to determine the appropriateness of each transaction under this scheme. In September 1991 (Resolution 712) the Security Council specified the details of this arrangement. Hussein objected to OFF since he believed that it would remove the pressure on the Security Council to lift sanctions. Iraq Survey Group Report, 9-10.

138 United Nations Security Council (SC), Resolution 665, August 25, 1990. http://daccess-dds- ny.un.org/doc/RESOLUTION/GEN/NR0/575/15/IMG/NR057515.pdf?OpenElement.

139 United Nations Security Council (SC), Resolution 670, September 25, 1990, http://daccess-dds- ny.un.org/doc/RESOLUTION/GEN/NR0/575/20/IMG/NR057520.pdf?OpenElement.

140 John M. Goshko, “UN Approves Resolution for Formal End of Gulf War”, Washington Post, April 4, 1991.

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resolutions” for its long and extensive list of specifications for Iraq.141 It drastically changed the purpose of the sanctions first imposed in August 1990 – they were now seeking the complete elimination of Iraq’s WMD and missile programs. Whereas Resolution 661, which first imposed the sanctions, made no mention of when and how they would be lifted, Resolution 687 stated that the sanctions would be lifted when Iraq had met all UN demands including the following: stop programs on WMD and ballistic missiles (with a range greater than 150 km), accept UN inspections to destroy, remove, or render harmless aspects of such programs, submit a declaration to the Secretary General stating all aspects of such programs, reaffirm its commitments under NPT, and unconditionally agree not to acquire, use, construct, or develop such weapons or components or research related to them.142 The oil and arms embargoes were also to be reviewed every 120 days by taking into consideration Iraqi compliance with Council demands.143 Both the US unilateral sanctions and the UN sanctions remained in place until

2003. They were lifted in May 2003, soon after President Bush declared an end to major combat operations in Iraq.144

Continued Nuclear Pursuit August 1990-January 1991

Iraq’s invasion of Kuwait in August 1990 marked an important turning point, after which the imposition of comprehensive sanctions and the expectation of a military confrontation with the

141 As expected, the resolution made war-related demands on Iraq, such as to restore Kuwaiti sovereignty, return stolen Kuwaiti property, repatriate Kuwaiti citizens, and accept liability for war-time damage. However, the resolution went much further in making the additional stipulations that Iraq undertake the destruction and monitoring of its nuclear, chemical, biological, and missile capabilities under UNSCOM and the IAEA. It also established intrusive inspections unique in the history of the UN, as discussed later in the chapter. United Nations Security Council (SC), Resolution 687, April 3, 1991, http://daccess-dds- ny.un.org/doc/RESOLUTION/GEN/NR0/596/23/IMG/NR059623.pdf?OpenElement.

142 United Nations SC, Resolution 687.

143 United Nations SC, Resolution 687, paragraph 28.

144 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM.

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United States affected key regime decisions. In this period, Iraq launched a crash program to quickly develop a nuclear weapon, achieving its farthest progress in weapons development.

However, by the time of the 1991 war, it only completed the first of four steps in the crash program (i.e. constructing a small reprocessing plant) and had not yet begun uranium enrichment with centrifuges.

The crash program envisaged setting up a small-scale reprocessing plant to extract enriched uranium from research reactor fuel; the uranium thus extracted was to be further enriched to weapons-grade in a 50-machine centrifuge cascade; the HEU would then be converted to uranium metal, for which Iraq had the necessary technology.145 Finally, the uranium metal was to be cast and fabricated into the explosives core of a nuclear weapon.146

By December 1990 Iraq completed the design, fabrication, and installation of the small reprocessing plant, in the remarkably short span of just three months. It is therefore apparent that in the short run, sanctions did not motivate nuclear restraint (comprehensive sanctions were imposed in August 1990)-- they clearly did not persuade the leadership to slow, stop, or reverse the program. However, the evidence indicates that sanctions denied some specialized technology required for centrifuge production. The crash program envisaged uranium enrichment using a 50-machine centrifuge cascade. The Engineering Design center (EDC), the headquarters of the centrifuge effort, had obtained design details of a sub-critical centrifuge in

1989, and components for centrifuge testing by early 1990.147 However, a large quantity of

145 IAEA Report, 1997.

146 Note by the Secretary-General, December 1995.

147 IAEA Report, 1997, 40. The EDC obtained most of this information through a German firm, H&H Metalform, which was already supplying Iraq with specialist machine tools for arms. The firm put the EDC in touch with two former employees of another German firm, MAN, which had designed and developed centrifuges for URENCO in the 1970s and 1980s. However, the EDC encountered some difficulty in producing maraging steel centrifuges, partly due to insufficient industrial infrastructure. Hence it changed its focus to the carbon fiber centrifuge, which it 144

carbon fiber and a winding machine, which had been ordered in 1989, never reached Iraq due to the sanctions.148 Thus sanctions delayed progress in the crash program by obstructing the supply of materials necessary for producing centrifuges.149

Restraint 2 (Rollback) January-February 1991

Iraq’s nuclear program underwent an important stage of restraint marked by the elimination of key nuclear facilities during the Gulf War in January-February 1991. The bombing campaign destroyed most of the facilities located at the Tuwaitha Nuclear Research

Center,150 reducing the program significantly in comparison to its pre-war stature. It destroyed

Iraq’s two functioning reactors – the IRT-5000 and the Tammuz II.151 Most remaining facilities were seriously damaged, including components of the crash program such as the pilot reprocessing plant and the facilities for producing enrichment feed material.152 Activity at the nuclear weapons development complex at Al Atheer also ceased following damage during the war.153 Additionally, the war impaired industrial sites and services supporting nuclear weapons

successfully tested in early 1990. IAEA Report, 1997, 39-40; Obeidi and Pitzer, Bomb in my Garden, 88-92; 122- 123.

148 IAEA Report, 1997, 42; Iraq Survey Group Report, 30. Iraq did not have the capability to produce carbon fiber domestically. Iraq Survey Group Report, Vol. 2, “Nuclear”, 31.

149 Nevertheless, the overall progress in the nuclear program at this time lends this period to be categorized as nuclear pursuit.

150 Iraq Survey Group Report, Vol. 2, “Nuclear”, 4. A detailed list of the specific facilities that were destroyed in Desert Storm is given in Attachment 3.4 of IAEA Report, 1997.

151 While the reactors themselves were “heavily damaged”, the pool storing reactor fuel remained intact (IAEA 1997, 75).

152 Iraq Survey Group Report, Vol. 2, 4.

153 IAEA Report, 1997, 59. 145

activities – the electricity grid, communications infrastructure, and supply lines.154 The following table sums up the main nuclear-related facilities destroyed during Desert Storm.

Table 4. 3 Nuclear facilities destroyed in Desert Storm

Facility Level of Destruction Tuwaitha Nuclear Research Center Total destruction of critical buildings

EMIS facility at Tarmiya Total destruction of some critical buildings

Planned second EMIS site at Al Sharqat Total destruction of basic building

Uranium conversion plant (for producing Total destruction EMIS enrichment feed material) at Al Jazira

Yellowcake production plant at Al Qa’im Total destruction of uranium plant

Source: Statement of IAEA Director General Hans Blix to the Security Council, March 11, 1992, accessed September 16, 2009, http://www.fas.org/news/un/iraq/iaea/dgsp1992n20.html.

Thus in Restraint 2 the nuclear program underwent a significant elimination of its components during the Gulf War.155

154 Boutros-Ghali, “Introduction”, 26; Economist Intelligence Unit, Country Profile Iraq, 1996-97; Iraq Survey Group. Desert Storm wreaked widespread damage on the basic infrastructure of the country, indirectly affecting the nuclear program. The most hard-hit were the telecommunications and electrical systems (incapacitating more than eighty percent of its grid). Almost four months after the war, Iraq was still producing only about a quarter of its pre- war electricity generation. This disrupted critical services such as water purification and sewage. Barton Gellman, “Allied Air War Struck Broadly in Iraq”, Washington Post, June 23, 1991; Patrick E. Tyler, “US Officials Believe Iraq Will Take Year to Rebuild”, New York Times, East Coast, June 3, 1991. A UN report by Under Secretary General Martti Ahtisaari stated that the war had “wrought near-apocalyptic results upon the economic infrastructure” and that the country had “been relegated to a pre-industrial age, but with all the disabilities of post- industrial dependency on an intensive use of energy and technology.” Martti Ahtisaari, Report to the Secretary- General on Humanitarian Needs in Kuwait and Iraq in the Immediate Post-Crisis Environment, March 20, 1991, S/22366, accessed September 21, 2009, http://www.un.org/Depts/oip/background/reports/s22366.pdf, 5. Oil refining capacity was also hampered during the war. Economist Intelligence Unit, Country Profile Iraq, 1996, 25.

155 During the war, the regime apparently ordered that the Rashdiya centrifuge facility be temporarily dismantled and hid in obscure places to be used later. Obeidi and Pitzer, Bomb in my Garden, 137. This activity is not considered here as constituting nuclear rollback since it was an effort at concealing aspects of the nuclear program rather than eliminating them. Indeed, the equipment was brought back to the Rashdiya facility after the war. Note by the Secretary-General, December 1995, 12.

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Restraint 2: Motivational or Resource Driven?

The increased pace of the nuclear program after August 1990 – most notably, the crash effort to develop a nuclear weapon -- indicates the depth of regime motivation for the program.

Thus we can reasonably suppose that Restraint in January-February 1991 was not caused by motivational factors. Restraint 2 was brought about by the Gulf War of 1991, when direct military action eliminated key facilities. Thus clearly rollback in Restraint 2 was caused by limits to the physical ability to pursue the nuclear program rather than due to declining motivations for nuclear weapons. This “resource constraint” did not arise from technological or financial restrictions, but was rather the result of war. This automatically implies that sanctions were not critical in Restraint 2. Moreover, as discussed in the theory chapter, the resource constraint route of sanctions cannot bring about nuclear rollback, but can at maximum stop the nuclear program. Nevertheless this section will consider the possible effects from the newly imposed sanctions during Restraint 2.

Sanctions and Restraint 2

Given that Restraint 2 was caused by military action and not by motivational factors, this section considers the possible effects of sanctions in constraining resources for the nuclear program in a significant way. The sanctions imposed on Iraq in August 1990 remain, till today, the most comprehensive and universal sanctions ever imposed.156 They thus held great potential for denying resources by means of both technological and financial limitations.

156 David Cortright and George A. Lopez, The Sanctions Decade: Assessing UN Strategies in the 1990s (Boulder, Colorado: Lynne Rienner Publishers 2000), 37.

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Technology denial

The UN sanctions prohibited the export of any commodity to Iraq (except food and medicine in case of a humanitarian need), were mandatory, and were implemented near- universally. Hence they met the basic conditions to mete out technological denial for the nuclear program. As briefly stated earlier, sanctions did in fact deny some technology for the crash nuclear program in 1990. This section considers whether such instances of technological denial contributed to restraint in January-February 1991.

Details on the specific components the denial of which may have contributed to nuclear reversal are limited. Sanctions did prevent the export to Iraq of advanced equipment for melting and casting uranium metal in nuclear weapons production, leaving it with a “rudimentary” capability in this regard.157 Sanctions also prevented the import of important equipment for a pilot plant for chemical enrichment.158 And sanctions prevented supplies for facilities to develop a high explosive package for a nuclear weapon (the Dhafer Project).159

For its centrifuge program Iraq was seeking to develop carbon fiber composite technology.

Related components for this technology, which were ordered from a German company in 1989, were prohibited by sanctions in 1990. After a second attempt Iraq succeeded in trans-shipping a major consignment (including carbon fiber) through Singapore to Jordan.160 However the materials never reached Iraq.161 This would have been a major obstacle for the crash program, had Iraq extracted HEU from research reactor fuel before the Gulf War.

157 IAEA Report, 1997, 30.

158 IAEA Report 1997, 44.

159 IAEA Report 1997, 56.

160 IAEA Report, 1997, 42.

161 Iraq Survey Group Report, Vol. 2, “Nuclear”, 30.

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Thus sanctions blocked the supply of some technological resources for the nuclear program.

However this does not appear to have contributed significantly to nuclear restraint for the following reasons. First, the nuclear program advanced rapidly in 1990 under the crash program, which was launched around the same time that sanctions were imposed in August 1990.

Although progress in the crash program was constrained by some sanctions-induced supply limitations, these did not prevent its overall advance. Second, Restraint 2 involved nuclear rollback, and this cannot be brought about by sanctions-induced resource constraints.162

Financial Constraints

Since the post-1990 sanctions on Iraq were comprehensive and universal, they held great potential to deny financial ability to pursue nuclear weapons. In particular, Iraq depended greatly on oil exports as a source of revenue and therefore the oil embargo significantly reduced its income.163 The production and export of oil effectively drew to a halt with the imposition of sanctions in August 1990. While production was roughly 2.8 million barrels per day in 1989 with exports estimated at 2.3 million barrels a day, the corresponding figures fell to 2.1and 1.6 respectively in 1990 – showing about a seventy percent decline in the quantity of oil exports.

The sanctions also threatened to disrupt the basic functions of Iraqi society as about 60 percent of food consumption was imported.164

162 As argued in the theory chapter, sanctions-induced resource constraints cannot bring about nuclear rollback; they can only slow down or stop a nuclear program, but cannot roll it back since this involves active elimination of parts of the program.

163 At the time of the invasion of Kuwait oil constituted about 60 percent of Iraq’s GDP and brought about 95 percent of its foreign exchange earnings. Economist Intelligence Unit, Country Report Iraq, First Quarter 1998; Economist Intelligence Unit, Country Profile Iraq, 2000, 26.

164 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM

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The financial impact of sanctions was magnified by existing economic problems -- Iraq had borrowed an estimated $40 billion from Saudi Arabia and Kuwait during the Iran-Iraq war, with a total foreign debt of about $65 billion by 1990.165 Apart from this heavy debt, the conflict with Iran had severely distorted the economy with the concentration of monetary and personnel resources on the war effort.166 The total damage to the economy from the war is estimated at

$130 billion to $150 billion.167 Thus its dependence on oil and the damage from the recently concluded Iran-Iraq war together poised Iraq on the brink of an economic crisis when sanctions were imposed.

Nevertheless in the first few months the effects of sanctions were mitigated by a combination of luck and regime actions. A bumper agricultural crop lessened the pressure on food supply, and resources plundered from Kuwait provided some consumer goods; reduced external military procurements helped salvage some foreign exchange.168 According to one author in the first two or three months of sanctions “Iraqis did not feel the pain” due to the large stock of looted consumer goods.169 The regime also undertook extreme economic measures to cope such as introducing rationing for food and everyday goods.170 It sold its gold reserves and

165 Economist Intelligence Unit, Country Profile Iraq, 1996, 34; Economist Intelligence Unit, Country Profile Iraq, 1990-1991, 13.

166 Economist Intelligence Unit, Country Profile Iraq, 1990-91, 10.

167 O’Sullivan, Shrewd Sanctions, 123; Solingen, Nuclear Logics, 157.

168 O’Sullivan, Shrewd Sanctions, 128-29.

169 Patrick Clawson, “Iraq’s Economy and International Sanctions” in Amatzia Baram and Barry Rubin, eds., Iraq’s Road to War (New York: St. Martin’s Press, 1993), 73.

170 Clawson, “Iraq’s Economy”, 74; Economist Intelligence Unit, Country Profile Iraq, 1990-91, 11-12.

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printed money; tried to encourage agricultural production by keeping prices high; and banned the import of luxury goods.171

The regime dealt with the sanctions-induced limitation on cash flows by drawing down on foreign exchange reserves, and undertaking dramatic domestic measures such as rationing basic commodities. Thus when Restraint 2 occurred in January 1991, Iraq was coping relatively well with sanctions, and did not yet face severe financial constraints. Therefore financial limitations from sanctions do not seem to have affected the nuclear program at least by the time of the Gulf

War. In fact the progress in the ‘crash program’ launched after the imposition of sanctions suggests that at least in the short run, sanctions did not slow the nuclear program. Thus the nuclear program accelerated in the immediate aftermath of the imposition of sanctions.

Table 4.4 Summary of Iraq’s nuclear restraint (rollback) Jan-Feb 1991

Prestige No

Restraint 3 – (Slow and Stop) March-April 1991

Once the Gulf War ended, Iraq resumed some activity related to the crash nuclear program.172 According to Mahdi Obeidi, the chief of the centrifuge program, after the

171 O’Sullivan, Shrewd Sanctions, 129.

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conclusion of Desert Storm “Saddam ordered an immediate resumption of the centrifuge program”.173 Thus in March-April 1991 the staff at the centrifuge facility at Rashdiya worked to reassemble the parts previously disassembled during the Gulf War.174 This recommencement of the nuclear program after the war was at a minimal level – it involved an effort to put together the components of the centrifuge facility, which had recently been taken apart. Moreover, the centrifuge effort was unlikely to progress much in enriching uranium for weaponization purposes, given that Tuwaitha had been largely destroyed in the war.175 The main activity in the nuclear program since the war was salvaging equipment, material, and documents (and as discussed below, after the passage of Resolution 687 concealing the salvaged equipment took priority).176 The absence of previously conducted nuclear-related activities lends this period to be categorized as restraint, with the program proceeding slowly compared to pre-1991. Thus in

March 1991 Iraqi nuclear restraint was marked by slow activity in the program.

This minimal centrifuge-related activity, however, lasted only a few weeks and ceased following the passage of Security Council Resolution 687 (in April) demanding the termination of all WMD programs in Iraq.177 Ongoing activity in the nuclear program – in terms of salvaging material and attempting to reassemble the centrifuge project after the war – ceased as a result of the unprecedented demands placed on Iraq by the resolution. In April 1991 all

172 It restarted work on building a 50-machine centrifuge cascade. Iraq Survey Group Report, Nuclear, 31.

173 Obeidi and Pitzer, Bomb in my Garden, 138.

174 Obeidi writes, “My staff and I worked around the clock, as the Special Security Organization (SSO) brought equipment back from their hiding places. We took the first steps toward rebuilding the clean rooms and reassembling everything as it had been weeks earlier.” Obeidi and Pitzer, Bomb in my Garden, 138-139.

175 Charles Duelfer (former Special Adviser to the Director of Central Intelligence for Iraqi WMD and former Deputy Executive Chairman of UNSCOM), interview by author, October 7, 2009, Maclean, Virginia.

176 Note by the Secretary-General, December 1995, 12-14.

177 Iraq Survey Group Report, Vol. 2, “Nuclear”, 31; Obeidi and Pitzer, Bomb in my Garden, 139.

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activity in the nuclear program stopped. Thus Restraint 3 was characterized first by the slowing of the nuclear program, and its eventual stopping altogether in April 1991.

Restraint 3: Motivational or Resource Driven?

The sluggish progress in the nuclear program in March-April 1991 was clearly the result of the recently concluded war, which eliminated important plants and equipment. The fact that the program continued some functions despite the odds against it after the war178 is indicative of the enduring interest in nuclear weapons. It suggests that the regime did not abandon the plan to acquire sufficient HEU for a nuclear weapon by April 1991, as envisaged in the crash program.

The strongest evidence of this is the activity in March 1991 to restore the Rashdiya centrifuge facility.179 After accepting Resolution 687 in April 1991, the regime sought to hide documents and equipment related to the centrifuge project, which the Iraq Survey Group believes is evidence of the desire to restart centrifuge production when sanctions ended.180 Nuclear weapons activity in March 1991 involved minimal efforts at reassembling the Rashdiya facility since it was not damaged in the war (the outside world was unaware of its existence). This was the sole program that it was practical for Iraq to restart immediately after the war. Thus the slowing of the nuclear program in March 1991 is attributed to war-related resource factors.

After the passage of Resolution 687 however, motivational factors drove the regime’s decision to stop all nuclear activity. Soon after accepting the resolution, the regime launched a program to conceal sensitive aspects of its past nuclear efforts. The leadership chose to end

178 Persisting with the nuclear program after the 1991 war was made difficult by the direct destruction of nuclear facilities, and by indirect factors such as damaged infrastructure and threats to regime stability – the leadership faced major insurrections among the Shi’a and the Kurdish populations just a few days after the war. As discussed later in the chapter, these were forcefully put down by the regime.

179 Note by the Secretary-General, December 1995, 12.

180 Iraq Survey Group Report, Vol. 2, “Nuclear”, 31.

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current nuclear activity in order to hide capabilities, apparently with the intention of resuming them once the Security Council absolved Iraq. The fact that the nuclear program stopped in

April 1991 (before the start of inspections the following month), when Iraq could have chosen to continue the minimal activity as in the weeks prior, suggests that this was motivationally driven.

The decision to stop the program in April 1991 appears to have been motivated by the desire to avoid detection of the past nuclear weapons program and remaining capabilities by UN inspectors. The regime attempted to do this by hiding or destroying materials and documents, beginning an extensive denial and deception effort as discussed below. This was carried out in an attempt to create the impression of the absence of a nuclear weapons program.181

Denial of the past nuclear weapons program as well as efforts to hide its elements is indicative of the ongoing desire to preserve some weapons-related capability. From the beginning Iraq denied any nuclear weapons related activity. In its first declaration to the IAEA it stated that it had no materials, equipment, or facility connected with nuclear weapons development and it sought to establish this by an attempt to “conceal the programme in its entirety by removing and concealing tell-tale equipment and materials from the sites involved”.182 The leadership launched a “denial and deception” plan in April 1991 before the start of inspections. It salvaged equipment after the war, concealed it in off-site locations, and sanitized facilities of all evidence of weapons-related activity.183 The deception effort was

181 David Kay, interview, 2009.

182 IAEA Report, 1997, 15.

183 Note by Secretary-General, December 1995, 14.

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headed by Hussein Kamel184 who ordered that tell-tale documents and equipment be taken away from their original sites and hidden in scattered locations.185 Laboratories and scientific personnel were to be moved to universities and institutes.186

The decision to stop and hide important parts of the nuclear program was driven by motivational concerns rather than resource factors – there was no obvious change in resource capability between March and April 1991. Moreover the leadership appears to have calculated that halting the program in April better suited its interests since it might enable its future reconstitution once the post-Desert Storm system ended. Thus the slow pace of the nuclear program in March-April 1991 is attributed to resource constraints, while the stopping of the program in April 1991 can be explained by motivational elements.

The concealment activity was begun soon after Iraq accepted Resolution 687. Submitting to the terms of the resolution marked an important turning point, after which Iraq’s nuclear activities did not resume. As mentioned earlier, Resolution 687 presented a long and extensive list of specifications for Iraq. Strikingly, it demanded that Iraq undertake the destruction and monitoring of its nuclear, chemical, biological, and missile capabilities under UN supervision.187

184 Apart from Hussein Kamel, Saddam Hussein’s son Qusay also supported deception activities. The two used the Military Industrial Commission (MIC) as well as the Special Security Organization, the Republican Guard, and the Special Republican Guard to conceal proscribed weapons and related materials. In the nuclear program the Special Republican Guard hid equipment for uranium enrichment. Iraq Survey Group Report, Vol. 1, 44, 46.

185 Iraq Survey Group Report, Nuclear, 4-5. In 1992 IAEA Director-General Hans Blix stated in a letter to the Security Council, “Iraq had gone to great lengths to conceal or destroy any evidence” of its nuclear weapons project at Al Atheer. Similarly at the EMIS facility at Tarmiya, the Iraqi authorities went to the extent of laying fresh concrete to hide installed machines and freshly painting the walls so as to hamper the detection of uranium. Report of the Secretary-General on the Status of Compliance by Iraq with the Obligations placed upon it under certain of the Security Council Resolutions relating to the situation between Iraq and Kuwait, January 25, 1992, S/23514,18.

186 Iraq Survey Group Report, Vol. 2, “Nuclear”, 71.

187 The resolution required Iraq to “unconditionally agree not to acquire or develop nuclear weapons or nuclear- weapon-usable material” including research, development, support, and manufacturing activities related to this; to accept “urgent on-site inspections and the destruction, removal or rendering harmless” of nuclear weapons-related material; to submit a declaration revealing all its nuclear weapons-related materials within 15 days; and to accept a 155

Through the resolution, the Security Council sought to implement an arms control regime that was backed by sanctions, inspections, and the potential use of military force.188 The striking nature of this demand was that Iraq was expected to permanently disavow such capabilities, to be ensured by intrusive inspections unique in the history of the UN.189 The extensive disarmament regime was a consequence of Iraq’s military defeat, and therefore, according to

Charles Duelfer was not arms control but “coercive disarmament” similar to that imposed on

Germany after World War I.190 The arrangement was designed to “transform Iraq from a country that had the world’s fourth-largest army at the outset of the crisis into an essentially demilitarized state.”191

Sanctions and Restraint 3

This section separately assesses the role of sanctions in the resource-driven restraint (the slowing of the program) in March-April, and in the motivational restraint (the stopping of the program) in April 1991.

I. Sanctions and the Slowing of the nuclear program

The slow rate of the nuclear program in March-April 1991 -- compared to the rapid pace in the latter half of 1990 -- was principally the result of the devastation brought about by Desert

Storm. There is no reason to think that the resource constraints imposed by sanctions in future plan (to be developed by the IAEA Director General) for ongoing monitoring and verification. Resolution 687, paragraphs 11-14.

188 Krasno and Sutterlin, United Nations and Iraq, 8. The possibility of force always remained so long as the Council declared, as it did in Resolution 687, that it was acting under Chapter VII of the UN Charter, which allows the use of military force for restoring international peace and security.

189 Krasno and Sutterlin, United Nations and Iraq, 7.

190 Charles Duelfer, Hide and Seek: The Search for Truth in Iraq (New York: Public Affairs, 2009), 72-74.

191 John M. Goshko, “UN Approves Resolution for Formal End of Gulf War”, Washington Post, April 4, 1991.

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Restraint 3 would have been significantly different from the effects just a few months ago in

January 1991, barring the passage of time. Hence although the sanctions did limit financial and technical resources, these were not the primary reasons for the slowing of the nuclear program in March 1991, which was more directly the result of Desert Storm.

II. Sanctions and the Stopping of the nuclear program

What role did sanctions play in the regime’s decision to stop the nuclear program in April

1991? The decision to stop the program in April 1991 likely arose from a consideration of the futility of nuclear pursuit at this time, in the context of the demands placed by Resolution 687.

The reality of Iraq’s defeat in the war meant that it had little choice but to accept the resolution.192 In fact, the resolution laid out the terms of the ceasefire for Iraq as the defeated party. Resolution 687 also clearly and strongly demanded that Iraq give up its WMD programs, and it declared that sanctions would continue until this was met. Therefore the political and military reality of defeat as codified by the Security Council was the principal reason for a recalculation of the benefits of the nuclear program. The leadership likely reasoned that its security and other foreign policy goals would be better served by temporarily shelving the program. As the following discussion shows, it seems that the regime accepted Resolution 687 largely due to security and domestic political factors – first its defeat and ejection from Kuwait, and then the consequences of domestic insurrections, with coalition forces moving to support the rebellion.

192 The letter from Iraq’s Minister of Foreign Affairs to the UN Secretary General in which Iraq accepted Resolution 687 stated that Iraq had “no choice” but to accept it. United Nations Security Council (SC), “Identical Letters dated 6 April 1991 from the Permanent Representative of Iraq to the United Nations addressed respectively to the Secretary-General and the President of the Security Council”, April 6, 1991, http://daccess-dds- ny.un.org/doc/UNDOC/GEN/N91/111/71/IMG/N9111171.pdf?OpenElement.

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Another reason for accepting Resolution 687 and consequently stopping the nuclear program was the expectation that sanctions would be terminated. Indeed, immediately after the resolution was passed, Saddam Hussein chaired a meeting of the Revolutionary Command

Council – the central decision-making body of the government – in which he established that getting the sanctions lifted was his priority.193 Security Council Resolution 661, which imposed the sanctions, had made no mention of when and how they might stop. However, Resolution

687 stated that “Council agreement” that Iraq had satisfied the newly stipulated disarmament obligations would lead to the lifting of sanctions.194 Saddam Hussein therefore ordered to “give up as little as necessary to satisfy the UN” so that sanctions could be ended without completely discarding Iraq’s WMD programs.195

Thus the goal of eliminating sanctions may have been an important consideration in

Iraq’s acceptance of Resolution 687 and the consequent stopping of its nuclear program.

Nevertheless, the dominant factor driving such considerations was Iraq’s defeat in the US-led war. This remains the overarching explanation for why it accepted the new Council resolution demanding WMD disarmament.196 At the end of the ground operation, in late February 1991

Iraq informed the Secretary General that it would comply with relevant Security Council resolutions subject to certain conditions. Hostilities ceased on 28 February 1991 after Iraq declared that its forces had withdrawn from Kuwait.197 The new political reality ushered in by

193 Duelfer, Hide and Seek, 79.

194 United Nations SC Resolution 687, paragraph 22.

195 Duelfer, Hide and Seek, 79.

196 Krasno and Sutterlin, United Nations and Iraq, 107.

197 United Nations, United Nations and the Iraq-Kuwait Conflict, 121. 158

this turn of events is seen in Iraq’s prompt acceptance of Resolution 686, the first Council resolution on Iraq after the war.198

Given that motivational considerations rather than resource constraints were the primary driver stopping the nuclear program,199 this section assesses which sub-category of motivations

(i.e. security, domestic politics, or prestige/norms) was most important in restraint, and whether sanctions played a role here. The focus will be on why Iraq accepted Resolution 687, since this precipitated the stopping of the nuclear program. After explaining this, I will then go on to analyze why Iraq chose not to attempt restarting the nuclear program.

The prestige model200 was largely absent as it is unlikely that Saddam Hussein expected improved national prestige from submitting to the post-war arrangement. Rather it can be surmised that accepting international inspections and agreeing to end all WMD programs (as stated in Resolution 687) was humiliating.201 As the letter to the UN noted, Iraq was effectively forced to accept a resolution that was “an unprecedented assault on the [its] sovereignty.’202 The issue of prestige seems to have affected the thinking of Iraqi officials till the very end. Later in

198 The resolution was passed on 2 March 1991, and Iraq accepted it on 3 March 1991. It demanded that Iraq comply with all twelve Security Council resolutions since the invasion of Kuwait. United Nations, United Nations and the Iraq-Kuwait Conflict, 121.

199 As stated earlier, Iraq ceased centrifuge-related activity just a few weeks after resuming it. This was in response to the passage of Resolution 687 in April 1991. The fact that Iraq did not persist with the centrifuge program although it clearly had some capability for this (especially since the centrifuge facility was largely untouched by the war) indicates that the stopping of the nuclear program in April was not necessitated by resource constraints.

200 According to this, leaders decide to undertake nuclear restraint due to the perceived prestige benefits of giving up a nuclear weapons program and conforming to the nonproliferation norm.

201 For example, referring to the inspections Saddam Hussein talked of how “[I]it was difficult for them [Iraqi officials] to be told one day to open all of their files and turn over all of their work and government secrets to outsiders.” Joyce Battle, “Saddam Hussein talks to the FBI”, National Security Archives, Electronic Briefing Book No. 279, May 13, 2004, 1, http://www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB279/23.pdf.

202 Security Council, Identical Letters Dated 6 April 1991 from the Permanent Representative of Iraq to the United Nations Addressed Respectively to the Secretary-General and the President of the Security Council, April 6, 1991, S/22456.

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the decade, the regime’s sensitivity regarding “presidential palaces” was apparently driven by prestige considerations since “the palaces represented the sovereignty of Iraq”.203 Another instance is the request of Iraqi officials that UNMOVIC (UN Monitoring, Verification and

Inspection Commission -- the new body that replaced UNSCOM) refrain from publishing photographs of the destruction of the Al-Samoud missiles.204 As an autocratic leader, Hussein feared that deference to the UN would be seen as an indication of weakness.205 Therefore it is highly unlikely that Hussein was motivated to submit to Resolution 687 by the desire to conform to international demands.

Motivations for accepting Resolution 687 and consequently ending the nuclear program must therefore be seen in the security and domestic politics models. The predominant motivational factor lies within the security model, in connection with Iraq’s acceptance of the resolution as the official ceasefire agreement at the end of the war.206 It could not realistically challenge the resolution.207 The post-war arrangement based on continued sanctions and newly instituted inspections was indeed the “peace of the victor”, made possible by Iraq’s defeat in the war.208

203 Joyce Battle, “Saddam Hussein talks to the FBI”, NSA Electronic Briefing Book No. 279, May 13, 2004, http://www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB279/23.pdf , 1.

204 Hans Blix, Disarming Iraq (New York: Pantheon Books, 2004).

205 David Kay (former head of Iraq Survey Group), interview by author, October 7, 2009, Arlington, Virginia.

206 According to the security model a state gives up its nuclear weapons program due to increased security risks by pursuing it i.e. negative security externalities.

207 Sarah Graham-Brown, Sanctioning Saddam: The Politics of Intervention in Iraq (New York: I. B. Tauris Publishers in association with MERIP, 1999), 20; Krasno and Sutterlin, United Nations and Iraq, 107.

208 Friend, After Non-Detection, What?; Krasno and Sutterlin, United Nations and Iraq, 1, 23-24.

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The sudden eruption of domestic rebellion after the war also likely generated domestic political pressure to accept Resolution 687.209 Soon after Desert Storm the regime faced a major

Shia uprising in the south, followed by a Kurdish rebellion in the north.210 Despite the successful quashing of the Shia uprising, it significantly affected Saddam Hussein, who termed it the “Page of Treason and Treachery”.211 After this, Hussein’s focus was no longer on Iraq’s military defeat but on securing his regime internally.212

Another insurgency erupted among the Kurds in the north, who had long been at loggerheads with the regime. About a million Kurdish refugees fled to neighboring Turkey and

Iran following the state’s successful clamping down of the movement in late March. Resolution

687 was passed on April 3 in this context. Iraq accepted the resolution on April 6, 1991, a day after the Security Council passed a resolution condemning the attack on the Kurds and asking for international cooperation to help the refugees.

From his discussions with commanders, it is evident that Hussein viewed the psychological impact of the war (causing the uprisings) as the greater defeat than actual defeat

209 The domestic politics model explains nuclear restraint as the result of the changing domestic power coalition to support those who favor restraint. In the case of Iraq, restraint is partly explained by domestic challenges that seriously threatened regime survival.

210 The Shia uprising was massive and spontaneous, characterized in one account as a civil war. Ofra Bengio, “Iraq’s Shi’a and Kurdish Communities: From Resentment to Revolt” in Amatzia Baram and Barry Rubin, eds., Iraq’s Road to War (New York: St. Martin’s Press, 1993), 58. It was partly driven by “the economic neglect of the southern regions” (as well as a reaction to overall Sunni dominance and Ba’athist secularism). Elizabeth A. Nathan and Kevin M. Woods, “Saddam and the Tribes: How Captured Documents Explain Regime Adaptation to Internal Challenges (1979-2003)”, JCOA Journal, Joint Center for Operational Analysis, US Joint Forces Command, Suffolk, Virginia, XII no. 1 (2010), 18. By 7 March several Shiite-majority towns in the south were controlled by insurgents (Hiro, 400). However the rebellion lacked leadership and direction. Trip, History of Iraq, 256. Amid evidence of growing Iranian involvement backing the insurgents, Saddam Hussein cobbled together his weakened army to launch a counteroffensive on 9 March. The movement was largely routed by mid-March, with thousands of refugees trying to move into Saudi Arabia and Iran. Dilip Hiro, Desert Shield to Desert Storm: The Second Gulf War (New York: Routledge, 1992), 401-402.

211 Woods et al, Saddam Tapes, 200.

212 Tripp, History of Iraq, 255.

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in battle. To redress the situation he believed that the army should be downsized, and commanders chosen carefully according to their “degree of loyalty”.213 The issue of loyalty thus became even more central for Saddam Hussein after 1991.214

Starting on April 7, 1991 the United States began airlifting relief aid to the Kurds.215 It was joined by Britain, France, and Turkey in Operation Provide Comfort, “said to have been the largest and most complex humanitarian operation attempted by the [US] military since World

War II”.216 The United States and its allies set up a no-fly zone in northern Iraq banning Iraqi aircraft from flying beyond the 36th parallel. The no-fly zone was set up to protect US air-drops of aid to the Kurds as well as the US ground forces that moved into northern Iraq as part of

Provide Comfort. It involved more than twenty thousand forces. It was against these internal and external developments that Iraq accepted Resolution 687 on 6 April 1991.

These events meant that the regime of Saddam Hussein was under threat both internally and externally. The experience of such opposition to his regime led Hussein to restructure the state apparatus, openly relying on tribalism.217 The combined effect of the war and the domestic insurrections made it important to achieve an end to sanctions – Hussein established this as his priority soon after the passage of Resolution 687. Since the resolution tied the termination of sanctions to WMD disarmament, this meant that the regime would now have to credibly claim that it had ceased WMD-related operations.

213 Woods et al, Saddam Tapes, 200-203.

214 Nathan and Woods, “Saddam and the Tribes,” 18.

215 Boutros-Ghali, “Introduction, 40-41.

216 Graham-Brown, Sanctioning Saddam, 43.

217 Baram, “Saddam’s Power Structure”; Nathan and Woods, “Saddam and the Tribes”, 19.

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Given that security and domestic political considerations motivated the leadership to accept the resolution and consequently suspend activities in the nuclear program, this analysis now asks whether sanctions contributed to such considerations. In other words, did sanctions help convince the leadership that its survival favored ending the nuclear program? This can be gleaned by examining the counterfactual scenario where sanctions are absent. In such a situation, the post-war arrangement would have consisted of UN inspections backed by the possible threat of renewed military attack, but not sanctions.218 The demand to end WMD programs would be associated with the carrot of ending inspections. Since the inspections were not yet known to be rigorous,219 this would likely not have persuaded the leadership to stop the nuclear program in April 1991.

In reality, soon after the passage of Resolution 687 Saddam Hussein conveyed that removing sanctions was a priority.220 The link between sanctions and WMD disarmament appears to have persuaded Hussein to end the nuclear program in April 1991, with the apparent aim of renewing it when inspections and sanctions ended. Thus sanctions were significant in this particular part of Restraint 3. Saddam Hussein stated in a 2004 interview that Iraq accepted

218 Member states could authorize the use of force if the Security Council determined that Iraq was in “material breach” of Resolution 687. Boutros-Ghali, “Introduction”, 78.

219 As was borne out in the following years, the regime had not expected that total WMD disarmament as stipulated in Resolution 687 really meant total disarmament. David Kay believes that the regime acceded to inspections due to the “misbelief” that they would be similar to those that had been conducted by the IAEA in the past. Kay also narrates an incident as told to him by the legal advisor to the Iraqi Foreign Office. According to this individual, Saddam Hussein called a meeting after the first IAEA inspection to ask his officials why Iraq was being subjected to extensive inspections. Hussein seemed surprised by the turn of events and did not view the rigorous inspections as something he had agreed to. For Saddam Hussein it was a slow and grinding process by which he came to realize the extent of what he was expected to give up. Charles Duelfer (former Special Adviser to the Director of Central Intelligence for Iraqi WMD and former Deputy Executive Chairman of UNSCOM), interview by author, October 7, 2009, Maclean, Virginia; Duelfer and Dyson, “Chronic misperception”, 84-85; David Kay (former head of Iraq Survey Group), interview by author, October 7, 2009. Arlington, Virginia.

220 Duelfer, Hide and Seek, 79.

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Resolution 687 to avoid harm to the populace.221 According to him, after the 1991 war the leadership focused on rebuilding Iraq’s infrastructure, including agricultural and economic programs.222 This desire must have been motivated not only by the war damage to the country’s basic services,223 but also by the fact that economic hardships fueled the rising domestic discontent.224 Sanctions hindered this objective of rebuilding the country after the war.

Therefore much of the sanctions “bite” derived from the post-war situation, where the costs from sanctions became magnified due to damage during the war. Resolution 687 worsened the situation further by tying the lifting of sanctions to WMD disarmament. Thus for the first time since the sanctions were imposed in August 1990, their lifting became linked with the status of

WMD programs. At the end of the day, although sanctions contributed to the leadership’s decision-making, their potency and significance derived from the military reality of battlefield defeat and the subsequent eruption of domestic rebellion.

221 Joyce Battle, “Saddam Hussein talks to the FBI”, NSA Electronic Briefing Book No. 279, February 13, 2004, http://www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB279/05.pdf, 3.

222 Joyce Battle, “Saddam Hussein talks to the FBI”, NSA Electronic Briefing Book No. 279, March 13, 2004, http://www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB279/15.pdf, 1.

223 A March 1991 UN report noted an “energy and communications’ vacuum”, which was “an omnipresent obstacle to the success of even a short-term, massive effort to maintain life-sustaining conditions in each area of humanitarian need.” Letter dated 20 March 1991 from the Secretary-General addressed to the President of the Security Council, March 20, 1991, Annex, S/22366, 6.

224 Hussein talked of the effect sanctions were having on Iraqi “morale” due to “the miserable life they are [were] living.” David D. Palkki and Shane Smith, “Contrasting causal mechanisms: Iraq and Libya” in Etel Solingen, ed., Sanctions, Statecraft and Nuclear Proliferation (Cambridge University Press, 2012), 279. Hence sanctions had an indirect effect on the nuclear program – they made its reconstitution less likely since the regime had to concentrate its limited resources on meeting internal and external threats.

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Table 4.5 Summary of Iraq’s nuclear restraint (slow and stop) March-April 1991

Causes of restraint Present? Resource Constraints: Techological No Did sanctions impose significant resource constraints on NW Financial No program? Motivational Changes: Security Yes Did sanctions induce motivational changes in NW program? Domestic Politics Yes

Prestige No

Restraint 4 – (Rollback) May 1991-1998

The final phase of restraint in the Iraqi nuclear program began with inspections in May

1991. Iraq’s nuclear program was systematically dismantled under the UN inspections, which were unprecedented in their scope and execution.225 In February 1992 the nuclear weapons project officially ended when the PC-3 was subsumed into the Military Industrialization

Commission (MIC).226 Iraq’s remaining nuclear facilities and equipment were destroyed or incapacitated during inspections in 1991-1992. Although more details of the secret nuclear weapons program came to be revealed in later years, by late 1992 Iraq no longer possessed any fresh uranium fuel or operable equipment.227 By February 1994 all aspects of the program were

225 In the summer of 1991, Iraq also undertook unilateral destruction of some WMD-related equipment and materials. While most of this pertained to the biological weapons program, some nuclear components were also destroyed. Most of the centrifuge-related materials that had been hidden by the security organizations (before the start of inspections) were largely rendered useless under Saddam Hussein’s orders to wreck or bury them. Some of it were stored at what was later purported to be Hussein Kamil’s chicken farm. Mahdi Obeidi (former head of Iraq’s centrifuge program), phone interview by author, June 28, 2012.

226 According to Jafar Dhia Jafar, senior nuclear scientists interpreted this development as the official end to the nuclear program. Braut-Hegghammer, Nuclear Entrepreneurs, 128-129.

227 Spent fuel was removed by February 1994. Some yellowcake was discovered after the 2003 war, but it had not been used since 1991. Many details of the past nuclear program, including the crash program, were revealed only in 165

rendered inoperable. After achieving such a total disarmament of the nuclear program, in the remaining years (until 1998) UN inspections ensured that it was not reconstituted. This phase of restraint under UN inspections is characterized by the rollback of the entire program.

As the theoretical discussion established, nuclear rollback is generally the result of motivational factors, where the leadership calculates that dismantling the nuclear program is more beneficial than continuing it. In rare instances, rollback may be the result of a forceful elimination of the program. This section will first consider whether Restraint 4 was primarily driven by resource constraints or motivational factors, and then assess the role of sanctions in

Restraint 4. As the analysis shows, rollback was brought about by external factors – military force and inspections – while the regime displayed no motivations to give up the nuclear weapons program.

Nuclear rollback from May 1991 till late 1994 occurred under the auspices of UN inspections, carried out by UNSCOM and the IAEA. Despite denial and deception techniques, inspections physically destroyed, removed, or rendered harmless important components of the program. Between 1994 and 1998 inspections ensured that these capabilities were not reconstituted (“ongoing monitoring and verification”).

The tally of the specific tasks achieved by inspections is impressive. The IAEA destroyed key facilities and equipment including the EMIS sites at Tarmiya, Al Sharqat, and Tuwaitha; the nuclear weapons facilities at Al Atheer and Al Qa Qaa; laboratory-scale reprocessing facilities at Tuwaitha; and equipment and materials of the centrifuge program. The agency destroyed a total of more than 50,000 square meters of facility floor space and destroyed or rendered

1995 after the defection of Hussein Kamel. What was revealed at that time, however, was largely confined to documents and some components; later, Mahdi Obeidi also revealed centrifuge components and “a complete set of workable centrifuge blueprints” that he had hidden in his garden. Since 1992, however, Iraq did not possess any operable equipment related to the nuclear program. Iraq Survey Group Report, Vol. 2, “Nuclear”, 13, 73.

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harmless more than 1,900 items and 600 tons sensitive alloys that could be used for uranium enrichment or nuclear weapons development.228

In addition the IAEA removed all fissile material from Iraq in 1991, taking away the roughly five grams of plutonium that Iraq had reprocessed. The agency also removed uranium fuel, with fresh fuel taken away in November 1991 and irradiated fuel removed by February

1994.229 The IAEA thus possessed custody of all known procured uranium compounds, all known practically recoverable amounts of indigenously produced uranium compounds, and all known plutonium. The IAEA effectively destroyed or removed most aspects of Iraq’s nuclear program by the end of 1992.230

Table 4. 6 Key aspects of nuclear rollback by inspections, 1991-1994231

Date Key inspection activities

June-Nov 1991 IAEA removes all plutonium (about five grams) from Iraq (most of it was removed in June)

Oct 1991 IAEA begins destroying or rendering harmless centrifuge and EMIS components; IAEA renders harmless the hot cells and glove boxes used to reprocess plutonium.

Nov 1991-June 1992 IAEA removes all fresh and lightly irradiated HEU fuel

April-June 1992 IAEA destroys nuclear weapons facility at Al Atheer

June-July 1992 IAEA destroys EMIS facilities at Tarmiya and Al Sharqat

228 IAEA Report, 1997, 16.

229 IAEA Report, 1997, 74.

230 Blix, Disarming Iraq, 30. By that point, spent fuel was the sole remaining element of the nuclear program.

231 As the table shows, most of this activity was completed by 1992. After 1994, when the Ongoing Monitoring and Verification (OMV) regime was established, the key task of inspections was to ensure that destroyed capabilities were not reconstituted. OMV entailed an intricate network of aerial surveillance, remote ground-based sensors, cameras, ground-penetrating radar, and other detection systems. At least one inspector viewed this intrusive system as draconian. George A. Lopez and David Cortright, “Containing Iraq: Sanctions Worked”, Foreign Affairs, July- August, 2004, 94; Tim Trevan, Saddam’s Secrets: The Hunt for Iraq’s Hidden Weapons (Harper Collins, 1999) 133-34; UN, United Nations and the Iraq-Kuwait Conflict, 79.

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Dec 1993-Feb 1994 IAEA removes spent fuel

Apart from this direct dismantling activity, inspections also made it difficult to continue weapons efforts by close scrutiny and repeated requests for documents and access to sites.232

Inspections had this important “deterrent value” since the presence of inspectors on the ground made it logistically difficult to reconstitute weapons efforts.233 The elaborate denial and deception scheme under Hussein Kamel kept personnel preoccupied with destroying, copying, and hiding all evidence indicative of the nuclear weapons program. It was indeed difficult to continue the weapons effort in the face of this massive undertaking.234

Restraint 4: Motivational or Resource Driven?

Drawing on available evidence, this section argues that Restraint 4 was not driven by motivational considerations – the leadership did not choose to end the nuclear program, but rollback was the result of defeat in the Gulf War, which set in place a post-war regime that eliminated the nuclear program. This system consisted of sanctions, inspections, and military force.

From all that we know today it seems fairly certain that Saddam Hussein’s ambition to develop nuclear weapons continued unabated.235 Although Hussein did not explicitly state this, his close advisers including his secretary Hamid Mahmud and Deputy PM Tariq Aziz believed

232 Alexander Thompson, Channels of Power: The UN Security Council and US Statecraft in Iraq (Cornell University Press, 2009), 123.

233 Lopez and Cortright, “Containing Iraq”, 94.

234 Iraq Survey Group Report, Vol. 1, 46.

235 Duelfer, Hide and Seek, 408; Mahdi Obeidi (former head of Iraq’s centrifuge program), phone interview by author, June 28, 2012.

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he intended to reconstitute the nuclear program after sanctions and inspections ended.236 In interviews with the FBI in 2004, Hussein talked of the still continuing threat from Iran, and of

Iran’s advancing weapons capabilities. He said that Iraq would have done what was necessary to counter this threat, possibly including reconstituting WMD.237

In 1991 and 1992 Saddam Hussein instructed officials to retain skilled scientists and prevent them from fleeing the country. According to his secretary Hamid Mahmud, in 1991

Hussein told scientists to keep relevant knowledge in their heads.238 They were dispersed among state-run industries under the general overview of the MIC.239 He sought to retain the requisite intellectual capital -- which he referred to as the “nuclear mujahedeen” as they were the elite and pride of Iraqi achievement -- for the purpose of reconstituting the program after sanctions were lifted.240 While ordering that evidence of NPT violations must be hidden, Hussein Kamel asked senior scientists to retain a copy of nuclear-related documents and some equipment.241 In

1993 Hussein Kamil reportedly told WMD scientists at the Space Research Center that WMD programs would resume after inspections.242

236 Iraq Survey Group Report, Vol. 1, Regime Strategic Intent, 49, 51.

237 In response to the question as to whether Iraq would reconstitute WMD, Hussein replied that Iraq would do what was necessary. Joyce Battle, “Saddam Hussein talks to the FBI”, NSA Electronic Briefing Book No. 279, June 11, 2004, http://www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB279/24.pdf, 3.

238 Iraq Survey Group Report, Vol. 1, “Regime Strategic Intent”, 44.

239 Obeidi and Pitzer, Bomb In My Garden, 143-144.

240 Charles Duelfer (former Special Adviser to the Director of Central Intelligence for Iraqi WMD and former Deputy Executive Chairman of UNSCOM), interview by author, October 7, 2009, Maclean, Virginia; Iraq Survey Group Report, Vol. 1, “Regime Strategic Intent”, 44.

241 Iraq Survey Group Report, Vol. 2, “Nuclear”, 4-5.

242 Iraq Survey Group Report, Vol. 1, “Regime Strategic Intent”, 44. Another indication of continued weapons interest is that in late 1991 or early 1992 Qusay Hussein asked Mahdi Obeidi, chief of the centrifuge program, if it could be revived. Obeidi and Pitzer, Bomb In My Garden, 152.

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The Iraq Survey Group believes that Iraq’s many attempts to salvage parts of the pre-

1991 nuclear program were indicative of its desire “to preserve a reconstitution capability.”243

For example, regime officials attempted to salvage equipment for the weaponization program at

Al Atheer and Tuwaitha after Desert Storm.244 In his book, lead nuclear scientist Jafar Dhia

Jafar reportedly stated that Saddam Hussein sought to preserve as much of the nuclear program as possible after the war.245 The scientists themselves are also said to have had this ambition246.

After the passage of Resolution 687 in April 1991, the regime actively sought to hide documents and equipment in the centrifuge project, apparently so as to rebuild it after sanctions ended.247 Indeed, the fact that these materials had been carefully preserved until August 1995 suggests a strong motivation to restart the program.248 Iraq kept hidden from UN authorities the true nature of its past nuclear program, including the extent and location of the centrifuge program, the crash program, and the nuclear weapons project. Simple matters such as refusing to admit, between 1991 and 1995, that the Engineering Design Center at Rashdiya was the headquarters of the centrifuge program suggested a strong intention to preserve the capability to resume the program later.249

243 Iraq Survey Group Report, Vol. 2, “Nuclear”, 62.

244 Note by the Secretary-General to Security Council, October 1995, 4-5.

245 Braut-Hegghammer, Nuclear Entrepreneurs, 126. The book was published in Norwegian in 2005 -- Jafar D. Jafar, Numan Saadaldin al-Niaimi, and Lars Sigurd Sunnanå, Oppdraget: Innsidehistorien om Saddams atomvåpen [The mission: The inside story of Saddam’s nuclear weapons] (Oslo: Spartacus, 2005).

246 Braut-Hegghammer, Nuclear Entrepreneurs, 128.

247 Iraq Survey Group Report, Vol. 2, “Nuclear”, 31.

248 Obeidi and Pitzer, Bomb In My Garden, 168; Note by the Secretary-General, December 1995, 13. They were turned over to the UN authorities as the “Chicken Farm” documents after the defection of Hussein Kamel in August 1995.

249 Note by the Secretary-General, December 1995, 13.

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Ultimately, the manner in which the Iraqi regime sought to retain as much of the nuclear program as possible without being detected indicates its desire to restart the program. This explains the incomplete nature of Iraq’s cooperation with the UN inspections.250 The concealment effort, which began soon after Iraq accepted Resolution 687 in April 1991, aimed to mislead inspectors while preserving the nuclear program.251 The initial response to inspections was to hide any incriminating evidence during the 24-hour notice that was usually given. After removing specific materials, the Iraqis would then bring them back once inspections were concluded. They had buried most of the equipment even before the first inspection, then excavated and moved it to different sites for concealment. But inspectors began to uncover evidence of the advanced EMIS program as early as the second IAEA inspection in

June 1991. When confronted with the evidence, Iraq decided to reveal some aspects of its weapons program while hiding the rest.252

250 Duelfer and Dyson, “Chronic misperception”, 87; Krasno and Sutterlin, United Nations and Iraq, 107. Iraq’s approach to UN inspections followed the strategy of revealing only what it guessed was already known. Rather than declaring all proscribed programs as required by the disarmament regime, the leadership launched a cat-and-mouse game whereby it effectively reversed the inspection system by denying all prohibited activities until confronted with evidence to the contrary. This forced the UN agencies to dig for evidence of violations rather than responding to forthright Iraqi declarations, as envisaged by Resolution 687.

251 Actually, the regime also sought to preserve important aspects of the clandestine nuclear program as early as Desert Storm. Dr. Mahdi Obeidi, the head of the centrifuge program, writes of how he was ordered to hide and preserve components of the program soon after the war began, “On the third day of the attack, Hussein Kamel came with orders to temporarily dismantle the entire centrifuge facility. During the following days, my staff and I carefully disassembled the rotors from their components and took apart the key pieces of the uranium hexafluoride system and turned them over to the Special Security Organization [SSO], which rushed around stashing them in suburban buildings and rural farmhouses.” Immediately after the war ended, the SSO brought back the equipment and, under orders from Saddam Hussein, Obeidi began reconstructing the centrifuge facility. However after Iraq accepted Resolution 687 in April 1991, Hussein Kamel ordered that the facility be dismantled and everything turned over once again to the security services. Obeidi and Pitzer, Bomb In My Garden, 137-139.

252 Iraq Survey Group Report, Vol.1, “Regime Strategic Intent”, 48; Scott Ritter, Endgame: Solving the Iraq Problem Once and For All (Simon & Schuster, 1999).

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Under the denial and deception program, the leadership also destroyed several components in order to avoid detection.253 For example it destroyed uranium metal pieces to avoid detection of past experiments in uranium metal purification and casting; and destroyed some 100 tons maraging steel.254 However such destructive activity was not driven by a desire to roll back the nuclear program, but was rather a move to eliminate evidence of the past weapons program.255 This is seen from the fact that at the same time that it was destroying such evidence, the regime also retained limited components.256 Such retention presumably belied the motivation to reconstitute the program at a later date. This was best seen in Iraqi activity returning components to nuclear sites after inspectors left a site.257

The repeated efforts to hide and change the true nature of the past nuclear program, especially as became revealed after the departure of Hussein Kamel, gave rise to the persistent doubt within the UN that Iraq had disarmed. Although the nuclear program had in fact ended,

253 Former weapons inspector Scott Ritter writes, “After physically concealing the material and documentation deemed critical of reconstituting his chemical, biological, nuclear, and long-range ballistic missile arsenals, he [Saddam Hussein] undertook a massive “cleaning up” operation, destroying most (but not all) of his missiles, munitions, and production tools, claiming that he had liquidated his arsenal – but without United Nations supervision. It was a brazen fait accompli to remove any trace of evidence of Iraq’s previous programs. This act of unilateral destruction was of course by itself a massive act of concealment, and the resultant Iraqi declarations when finally submitted were based on the “cleaned up” No.s of the cooked books” (Ritter 1999, 34-35, emphasis added). The decision, however, backfired by only deepening suspicions of a hidden nuclear program and showing that Iraq had not made a full and complete declaration as mandated by the Security Council.

254 Bureaucratic inefficiency meant that quantities of materials were often acquired in far larger amounts than was necessary. IAEA Report, 1997, 17, 30, 41.

255 Charles Duelfer (former Special Adviser to the Director of Central Intelligence for Iraqi WMD and former Deputy Executive Chairman of UNSCOM), interview by author, October 7, 2009, Maclean, Virginia; David Kay (former head of Iraq Survey Group), interview by author, October 7, 2009. Arlington, Virginia; Iraq Survey Group Report, Vol. 1, “Transmittal Message”, 9.

256 For instance in regards to experiments related to uranium metal, Iraq retained 10 uranium bullets and 9 cast rods. IAEA Report, 1997, 30.

257 David Kay talks of how US intelligence discovered that the Iraqis were burying large amounts of material next to the Tuwaitha Center before the start of the first IAEA inspection, and promptly bringing it to the Center immediately after the inspection. Krasno and Sutterlin, United Nations and Iraq, 53.

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this suspicion of the UN and the United States was correct in so far as it displayed Saddam

Hussein’s apparent intent to reconstitute WMD.

Since the desire for the nuclear weapons program continued, Restraint 4 must be the result of resource constraints. Rollback between May 1991 and 1998 was the result of resource- related factors – mainly the destruction or removal of nuclear components by inspections -- rather than a change in motivation for the program. As the following will establish, sanctions helped make it very difficult for the regime to rebuild what was eliminated by inspections.

Sanctions and Restraint 4

Given that Restraint 4 was brought about by resource limits rather than motivational changes, if sanctions contributed to rollback it would have been through resource denial. As argued previously, however, sanctions-induced resource constraints cannot adequately explain nuclear rollback. The following section therefore addresses whether sanctions, through resource constraints, prevented the rebuilding of weapons-related capabilities that were destroyed by the war and inspections.

Technology Denial

To what extent did sanctions deny technology for the nuclear program since May

1991?258 Technological denial cannot occur unless sanctions are widely implemented, and this was indeed the case with Iraq at least in the first years of the decade.

In general, procurement transactions on WMD-related items grinded to a halt in the first few years of sanctions. Until 1996 the only potential suppliers were Jordan, Ukraine, and

258 Resolution 687 specifically banned the supply of items that could be used for military development, including conventional arms and other military equipment, technology that would aid the development of conventional arms or WMD, and personnel and materials that would in any way support conventional arms or WMD. United Nations SC Resolution 687, paragraph 24.

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Romania.259 There is anecdotal evidence that sanctions blocked the supply of some specific components in the nuclear weapons program – such as equipment for melting and casting uranium metal, carbon fiber technology for centrifuges, and the project for high explosives testing.260 Dr. Mahdi Obeidi believes that sanctions were “very effective” in blocking materials for the centrifuge program.261

After the war, Iraq’s best chance for rebuilding nuclear weapons-related capabilities lay in the centrifuge program. Since it was unknown to the outside world, the centrifuge program headquartered at Rashdiya was untouched during the war.262 In late 1991 inspectors gleaned some preliminary information about the centrifuge program. By the end of 1992, inspectors destroyed or rendered inoperable centrifuge-related equipment and materials at Rashdiya.263

Therefore, even if Iraq attempted to restart the centrifuge program, the maximum it might have been able to do was “initial research and development” using “only a single centrifuge”.264 It would have needed to obtain equipment and materials such as carbon fiber from abroad.265

There is at least one major instance when the delivery of such materials to Iraq was obstructed

259 The Security Council turned a blind eye to illegal oil exports to Jordan as it recognized the Jordanian economy’s dependence on imports from Iraq; Ukraine and Romania emerged from the Soviet collapse with military hardware and expertise. Iraq Survey Group Report, Vol. 1, “Regime Finance and Procurement”, 24, 93.

260 IAEA Report, 1997, 30; 42; 44; Iraq Survey Group Report, Vol. 2, “Nuclear”, 30.

261 Mahdi Obeidi (former head of Iraq’s centrifuge program), phone interview by author, February 2, 2012.

262 However, Iraq dismantled and hid equipment from the facility on two occasions – prior to the war, and prior to the start of inspections. Obeidi and Pitzer, Bomb In My Garden, 137-139.

263 IAEA Report, 1997, 78-85.

264 Iraq Survey Group Report, Vol. 2, “Nuclear”, 7. The machines for producing centrifuges had also been destroyed in inspections. Note by the Secretary-General to the Security Council, December 17, 1991, S/23295, 7.

265 Note by the Secretary-General, October 1995, 7. Obeidi believed that a reconstituted centrifuge program would use carbon fiber. Iraq Survey Group Report, Vol. 2, “Nuclear”, 23.

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by the UN sanctions in 1990.266 It is reasonable to conclude that such difficulties would have continued for most of the decade.267 Moreover, to produce fissile material using centrifuges,

Iraq would need to reconstruct uranium conversion capabilities, which were destroyed by military force and inspections and never rebuilt.268 Hence technology denial by sanctions made it hard for the regime to reconstitute the nuclear weapons program.

Financial Constraints

Iraq experienced a significant decline in its economic capabilities in the 1990s, with national income falling to levels before the 1973 oil boom. As discussed below, there is little disagreement among scholars that sanctions were an important cause of this worsening economic situation. The sanctions held political and moral legitimacy, were minimally contested at the Security Council,269 and were widely implemented.

The sanctions were particularly effective since Iraq depended on one commodity for the bulk of its foreign trade and national income.270 In 1989 oil contributed about 61% to the

GDP.271 Exports decreased from 1.6 million barrels per day in 1990 to 0.6 in 1994.272 Real GDP

266 IAEA Report, 1997, 42; Iraq Survey Group Report, Vol. 2, “Nuclear”, 30.

267 Sanctions were widely implemented throughout the 1990s. However, as discussed later, violations of the sanctions began to increase rapidly after 1997, when Saddam Hussein skillfully manipulated the terms of the UN- sponsored Oil-for-Food program. It is possible that, at this time, he could have succeeded in obtaining specialized centrifuge materials from abroad, despite the sanctions. However, there is no evidence of any such attempts.

268 Iraq Survey Group Report, Vol. 2, Nuclear, 7.

269 Security Council Resolution 660 condemning the Iraqi attack (passed on the same day that Iraq invaded Kuwait) was passed 14-0 with Yemen abstaining; Resolution 661 imposing sanctions was passed 13-0 with Cuba and Yemen abstaining.

270 This dependence constrained the regime’s ability to implement the typical measures undertaken by states when faced with sanctions – diversifying the economy by turning to other income-generating sectors. The multilateral nature of the sanctions also made it almost impossible to (legally) find new trade partners.

271 Economist Intelligence Unit, Country Profile Iraq, 1996, 13.

272 Economist Intelligence Unit, Country Profile Iraq, 1996-97; 1998-99. 175

fell 63 percent in 1991; by 1995 per capita income shrunk dramatically to about a fifth of its

1990 level (from $927 to $161).273 Financial sanctions meant that Iraqi assets of about $4.5 billion abroad were frozen, and loans, credits, and foreign aid were almost nil. Thus Iraq went from a relatively high standard of living to that of the poorer developing countries.274

Figure 4.3 Iraq’s falling GDP in the 1990s

Source: Plotted based on data from National Accounts Estimates of Main Aggregates, United Nations Statistics Division, http://data.un.org/

The graph below shows that the country experienced negative or zero growth rates until 1997.275

273 Economist Intelligence Unit, Country Profile Iraq, 1996-1997; UN data, http://data.un.org/.

274 O’Sullivan, Shrewd Sanctions, 123, 125.

275 The exception is in 1992, when GDP growth rate jumped from -62.9% to 29.2%. Economist Intelligence Unit, Country Profile Iraq, 1996. This is attributed to some good luck in the form of a bumper agricultural harvest in 1990 as well as the plundering of resources from Kuwait. O’Sullivan, Shrewd Sanctions, 129.

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Figure 4.4 Iraq’s GDP growth rates in the 1990s

Source: Plotted based on data from Economist Intelligence Unit, Country Profile Iraq, 1996, 1999-2000, and 2003.

The effects of declining income were compounded by high inflation, unemployment, and a tremendous foreign debt. Inflation was particularly reflected in food prices, which jumped

4000 times from 1990 to 1996; high debt resulted in low foreign exchange reserves.276 Iraq had borrowed an estimated $40 billion from Saudi Arabia and Kuwait during the Iran-Iraq war, with a total foreign debt of about $65 billion by 1990.277

The sanctions effect was therefore magnified since they affected an economy already weakened by the long war with Iran, which is estimated to have inflicted a total damage of $130 billion to the economy in addition to the high foreign debt.278 Further, the 1991 war destroyed

276 Economist Intelligence Unit, Country Report Iraq, First Quarter 1996, 18.

277 Economist Intelligence Unit, Country Profile Iraq, 1996, 34; Economist Intelligence Unit, Country Profile Iraq, 1990-1991, 13.

278 O’Sullivan, Shrewd Sanctions, 123.

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still more of Iraq’s economic infrastructure.279 Aspects of the oil industry were specifically targeted during the war, damaging key infrastructure required for oil production.280 Refining capacity was hampered during both wars, but much of it was restored by 1993.281

Thus Iraq’s economic plight in the early 1990s can be significantly attributed to sanctions, largely through the ban on oil exports.282 Hufbauer et al estimate that until the start of the UN sponsored Oil-for-Food (OFF) program,283 the sanctions inflicted an annual cost to the economy of about $ 18.8 billion, including some $13.6 billion due to the ban on oil exports and $250 million with the suspension of US agricultural export credits.284

The economic crisis peaked around 1995-1996, leading Saddam Hussein to accept

OFF.285 This significantly affected the economy, which entered a phase of recovery after 1997.

The prior effect of sanctions is seen from the changes once OFF was implemented -- the economy grew by 25% after the first revenues started coming in 1997, the first positive growth since 1989. The production of crude oil nearly doubled and the export of crude oil more than

279 Tripp, History of Iraq, 261.

280 Ahtisaari, Report to the Secretary-General, 12.

281 Economist Intelligence Unit, Country Profile Iraq, 1996, 25.

282 Anthony H. Cordesman and Ahmed S. Hashim, Iraq: Sanctions and Beyond (Boulder: Westview Press, 1997), 137; O’Sullivan, Shrewd Sanctions, 125.

283 In April 1995 the Security Council had passed Resolution 986 allowing Iraq to sell up to $1 billion worth of oil every 90 days and use the returns for humanitarian goods. Iraq accepted this proposal in May 1996 and the official OFF program was agreed to in December 1996. The first food shipments arrived in March 1997. Iraq Survey Group Report, Vol. 1, “Regime Finance and Procurement”, 257.

284 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM.

285 Iraq Survey Group Report, Vol. 1, “Regime Strategic Intent”, 42, 48; O’Sullivan, Shrewd Sanctions, 130. The decision to accept OFF was also influenced by the defection of Hussein Kamel. The new Iraqi revelations on WMD programs following that event led Saddam Hussein to believe that sanctions were not likely to end in the near future. He was encouraged in this belief by France and Russia. Robert Litwak, Regime Change: US Strategy Through the Prism of 9/11 (Washington, D.C.: Woodrow Wilson Press, 2007).

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doubled that year.286 Government revenues occurred both through UN-approved contracts under

OFF, and through illicit measures. The principal illicit means for exporting oil were bilateral trade protocols; small amounts of oil were also smuggled out.287 Between 1997 and 1998 oil revenues increased significantly and remained only a little short of pre-1990 levels. By 1999

Iraq was earning oil income similar to the levels before the Gulf War and sanctions. The limitations to sanctions introduced under OFF thus formed a major turning point, “saved[ing] the Iraqi Regime from financial collapse and humanitarian disaster”.288

In sum, the multilateral UN sanctions were an important cause of the manifold strains on the Iraqi economy in the 1990s.289 While the crisis was deepened by such factors as Desert

Storm and its destruction of industrial infrastructure as well as prior regime decisions including the war with Iran, rising growth in the late 1990s under OFF is indicative of the potential improvement the economy could have undergone in the absence of sanctions.290 Moreover, Iraq could also have benefited from developing some of the many unexploited but discovered oil fields in the country if sanctions had not blocked international commerce.291

Given that sanctions had a tremendous impact on Iraq’s economy, how did this affect the nuclear program? Due to the absence of readily available information directly discussing the

286 Economist Intelligence Unit, Country Profile Iraq, 1998-99.

287 Trade protocols were trade arrangements with regional states under which Iraq would sell oil. They generated the bulk of Iraq’s illicit income during the sanctions period. The trade protocol with Jordan was the key to Iraq’s survival until the implementation of OFF, generating some $3 billion. Oil smuggling is estimated to have contributed the much smaller amount of $210 million between 1991 and 1997. Iraq Survey Group Report, Vol. 1, “Regime Finance and Procurement”, 19-20, 24, 37.

288 Iraq Survey Group Report, Vol. 1, “Regime Finance and Procurement”, 28; O’Sullivan, Shrewd Sanctions, 131.

289 Cordesman and Hashim, Iraq; O’Sullivan, Shrewd Sanctions.

290 O’Sullivan estimates that Iraq lost about $200 billion in oil revenues between 1990 and 2000 due to sanctions. O’Sullivan, Shrewd Sanctions, 125.

291 Iraq Survey Group Report, Vol. 1, “Regime Strategic Intent”, 39.

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financial scope of the nuclear program in the 1990s, this analysis focuses on indirect evidence of possible financial constraints on the nuclear program.

In May 1991, at the start of Restraint 4, Iraq was still recovering from war-related damage. Nevertheless, in the early years of sanctions the regime staved off collapse and put down rebellions in the north and south. It rebuilt basic infrastructure and does not seem to have found it impossible to continue paying scientists’ salaries. Such rebuilding was possible because

Iraq marshaled its limited resources to sustain the regime, the salaries of key officials even increasing in the early 1990s.292 The regime relied on a bumper agricultural crop as well as resources looted from Kuwait; it rationed food supplies by decreeing that Iraqis eat only two meals a day, and attempted to increase farm output by raising agricultural prices. The government took further steps such as banning the import of luxury goods and selling its gold reserves. In 1995 it launched an emergency austerity program involving a freeze on salaries and reduction of food rations.293 The fact that Saddam Hussein did not accept OFF until 1996, when he did so under economic pressure, strongly suggests that he did not perceive the dire economic necessity of doing so until that time.294

After 1997 the economy began recovering significantly, and financial limitations were not as severe as in the early 1990s. Therefore, since survival was the primary aim for the regime, this would suggest that financial resources were reserved for such purposes at least until the mid-1990s. Naturally, this limited the funds available for rebuilding a nuclear program, which now needed to be reestablished almost entirely from scratch. As described below, after 1998, the

292 O’Sullivan, Shrewd Sanctions, 129.

293 O’Sullivan, Shrewd Sanctions, 130.

294 Clawson, “Iraq’s Economy”, 76.

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regime did start some incipient activities that could have applications in a future weapons program. However it appears that such activities were not undertaken before 1998 due to financial constraints. Hence sanctions-induced financial limitations prevented the rebuilding of weapons-related activities that had been destroyed by the war and UN inspections.

In sum, sanctions inflicted some resource denial, which made it hard to reconstitute the nuclear program. However, sanctions alone would probably have been insufficient to prevent such reconstitution. For example, scientist Mahdi Obeidi, who headed the centrifuge program, believes that if not for inspections, Saddam Hussein would have acquired the bomb if he set his mind to it, despite sanctions.295 To assess the relative importance of inspections and sanctions, I consider the following counterfactual, where Iraq faces inspections but not sanctions after 1991-

1992.

Counterfactual: No Sanctions296

By 1992 the combined effects of the war and inspections had largely destroyed Iraq’s nuclear weapons program. However, given that motivations for nuclear weapons likely remained unabated, Saddam Hussein would probably have attempted to secretly rebuild the program. In the absence of sanctions after 1992, would he have succeeded in such a hypothetical effort?

Without sanctions, the regime would have had easier access to both the financial and the technical resources for reconstructing the nuclear program.297 It is highly likely that inspectors

295 Mahdi Obeidi (former head of Iraq’s centrifuge program), phone interview by author, June 28, 2012.

296 As already pointed out, the main reason for nuclear rollback in 1991-98 was inspections, not sanctions. In order to properly assess the role of sanctions, this sub-section considers whether Iraq would have rebuilt the program in the absence of sanctions.

297 However, it can be expected that the United States would have pressured other nuclear suppliers to avoid providing nuclear technology. 181

would have eventually detected such a secret nuclear weapons program. This discovery would probably have been delayed by Iraqi obstructions. In fact, without sanctions to motivate the leadership to cooperate with inspections, it is likely that the Iraqi government would have obstructed and obfuscated the work of inspectors even more than in reality.298 This would probably mean that it would take longer for inspectors to discover the centrifuge and EMIS programs, the most advanced projects for producing fissile material. However, the persistent and unusual methods used by some inspection teams indicates that it is highly likely that they would eventually have come upon the programs despite Iraqi deception.299 In such a situation,

298 In reality, Iraq actively sought to prevent and obstruct the work of inspectors from the beginning, starting with the denial and deception scheme. During inspections, Iraqi officials tried to prevent inspectors from accessing sites and documents. The first major such obstruction occurred in June-July 1991 -- Iraqi officials blocked access to three separate inspection sites, firing warning shots when inspectors tried to prevent trucks (loaded with evidence of the EMIS program) from leaving the site. UN, United Nations and the Iraq-Kuwait Conflict; Trevan, Saddam’s Secrets, 65-67. Around the same time, UNSCOM also attempted to start aerial surveillance using its helicopters but Iraq refused to support their safety or provide facilities for their operation. After Iraq refused to guarantee the safety of its helicopters, UNSCOM began its aerial reconnaissance in August using American aircraft flown by US personnel. UN, United Nations and the Iraq-Kuwait Conflict, 81. During the sixth inspection in September 1991, much publicity ensued from Iraq’s dramatic handling of 44 inspectors who were detained and made to spend three nights in a bus and cars in a Baghdad parking lot when they came upon documents showing Iraq’s secret nuclear weapons program at PC-3 (see Footnote 105).

299 Inspection chief David Kay used some innovative techniques, especially in September 1991. Former UNSCOM inspector Tim Trevan notes that this inspection was to be “the first of its kind” as it would involve elaborate efforts to secure inspection sites, obtain access to all parts of the key buildings (the Nuclear Design Center and the headquarters of the PC-3) sometimes by breaking down doors and locks, and scanning relevant documents obtained. Trevan, Saddam’s Secrets, 102. As it happened, the inspectors came upon incontrovertible evidence of nuclear weapons development in the building of the Nuclear Design Center in Baghdad. They succeeded in ferreting out some of the material by simply stuffing the documents into the jacket of an inspector who had taken ill and was returning to Bahrain. The Iraqis soon realized that the inspectors had discovered the materials and they prevented UNSCOM vehicles loaded with these documents from leaving. After a few hours of deadlock, Iraqi officials physically confiscated the documents by threatening inspectors. They were later returned to the inspectors after removing key documents. The next day inspectors found more relevant documents at the headquarters of the PC-3 in Baghdad. Iraqi officials once again demanded that the documents be returned and began to physically remove inspectors one by one out of the building. A major deadlock ensued when David Kay refused to hand over the documents collected. The inspectors spent the next four days in the parking lot of the building – a total of ninety-six hours facing physical threats and at the center of a media furor that had caught the world’s attention by now. The inspectors were finally released under pressure from the Security Council, which involved the threat of military action. Apart from such innovative inspection methods, detection would also have been facilitated by the fact that Iraq would have had to re-build its entire program. Trevan, Saddam’s Secrets, 108; Note by the Secretary-General to the Security Council, October 8, 1991, S/23122; UN, United Nations and the Iraq-Kuwait Conflict, 81.

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inspectors would likely have proceeded to systematically eliminate all remaining aspects of the nuclear program, much as happened in reality.

On another level, the absence of sanctions-induced financial problems would imply that

Iraq would not need to embark on drastic economic measures such as strict rationing on food and other necessary goods. This, in turn, would mean that the scope for domestic insurrection would be more limited than in reality. In the early post-war period, then, Saddam Hussein could rebuild the economy and the nuclear program without having to focus exclusively on regime survival. In other words, without sanctions, Iraq would have been able to make more progress in rebuilding the nuclear program in the 1990s.

This counterfactual scenario shows that, in the absence of sanctions, (a) it is highly likely that Iraq would have restarted a secret nuclear program, and that (b) this would probably have been detected and destroyed during inspections. The elimination of the nuclear program was conducted by inspections; sanctions helped prevent its rebuilding. Thus, although sanctions were not the cause of nuclear rollback, they helped prevent the rebuilding of the nuclear program in the 1990s.

Table 4.6 Summary of Iraq’s nuclear restraint (rollback) May 1991-1998

Causes of restraint Present? Resource Constraints: Techological No Did sanctions impose significant resource constraints on NW Financial No300 program? Motivational Changes: Security No Did sanctions induce motivational changes in NW program? Domestic Politics No

Prestige No

300 As the discussion showed, sanctions were not the cause of rollback during 1991-98; however, they did help prevent the rebuilding of what was destroyed by military force and inspections.

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Continued Nuclear Restraint 1999-2003

All aspects of the nuclear program had been completely eliminated by the time inspectors left Iraq in late 1998. This had largely been accomplished by 1994; important documents and some components were handed over after the defection of Hussein Kamel in 1995. The nuclear program was not reconstituted after inspectors departed in 1998. Nevertheless, economic recovery enabled Saddam Hussein to increase funding for the IAEC, and he showed a general interest in reviving the program. This section considers the impact of sanctions during this period.

The standoff between Iraq and the Security Council came to a head in 1998, after which there were no more UN inspections until late 2002.301 Since 1998 the regime embarked on activities that could be useful for a reconstituted nuclear program (but did not actually reconstitute it). It launched several military research and development programs to rebuild the military-industrial complex and sought to acquire dual-use items and materials.302 Saddam

Hussein also took a renewed interest in the IAEC, meeting with senior scientists in 1999 and

“offering to provide them with whatever they needed.” In 2001 he increased funding for the agency. The IAEC grew under these efforts, starting a modernization project in late 2001; technical capabilities were improved; and salaries for scientists increased ten times from 2001 to

301 Since 1996 Iraq began objecting to inspections at “sensitive sites” for reasons of national security, following which UNSCOM agreed to give advanced notice of inspections at these sites. Iraq also objected to American and British inspectors, and to monitoring and verification measures, which were based on heavy surveillance mechanisms. All UN Inspectors were withdrawn prior to Operation Desert Fox in December 1998, during which the United States and Britain undertook cruise missile strikes on Iraqi military and political targets. The inspectors were not re-admitted afterwards. In late 2002 Saddam Hussein allowed inspections by the new UN agency, UNMOVIC (which replaced UNSCOM) in the buildup to the 2003 war.

302 Iraq Survey Group Report, Vol. 1, “Regime Strategic Intent”, 57.

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2003.303 In January 2002 Hussein ordered the IAEC and the Military Industrial Commission

(MIC) to work collaboratively in projects on physics, machining, and electronics.304

This renewed activity was possible due to economic growth from the inflow of oil from

1997, rising illegal trade with neighboring countries, and the ending of inspections. The increased activities ceased after 2001, probably due to the buildup to the 2003 war. The following pages consider the resource denial and motivational impact of sanctions in this period.

(a) Resource Constraints 1999-2003

Technology Denial

There does not appear to have been any direct effort at acquiring nuclear technology during this period. However there was increased activity geared toward improving the country’s technical infrastructure and military capability, including missile development.305 The Iraqi

Intelligence Service led the effort to siphon banned goods through Syria, Jordan, Belarus, and

Turkey.306 The Ministry of Foreign Affairs coordinated the movement of cash obtained from illicit oil sales and the procurement of military and dual-use goods. The IAEC was active in seeking to retain scientific expertise as well as pursuing procurement contracts for varied items

303 Iraq Survey Group Report, Vol. 1, “Regime Finance and Procurement”, 59, 83.

304 The Ministry of Industrialization and Military Industrialization was reorganized to form the Military Industrial Commission or MIC in 1991. In the late 1990s MIC was strengthened to become the source of the modernization of Iraq’s military-industrial capabilities. Although the nuclear program lay outside of the MIC (and directly under Saddam Hussein), MIC was in charge of biological and chemical weaponization. In 2001-02 MIC was engaged in a project to explore carbon fiber for developing the Al Fat’h missile. Iraq Survey Group Report, Vol. 1, “Regime Strategic Intent”, 17.

305 This was done by creating front companies for government agencies, which obtained materials and technologies for conventional arms, dual-use purposes, and even WMD programs. For example, a front company for MIC obtained some of the equipment ordered under a 2001 contract with a Belarusian company for ferrite materials; the same company also had contracts with Romanian firms for production lines for magnets, but equipment was not received. Iraq Survey Group Report, Vol. 1, “Regime Finance and Procurement”, 264-265. In 2001, high-strength aluminum tubes were seized due to suspicions of a renewed centrifuge program (in actuality, they were meant for developing rockets. Iraq Survey Group Report, Vol. 2, “Nuclear”, 21-23.

306 Iraq Survey Group Report, Vol. 1, “Regime Finance and Procurement”.

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such as communications systems, medical, and chemical technology.307 It is striking that in

2001-02 MIC launched a project to explore carbon fiber technology using a filament-winding machine that had not been used since 1990.308 Developing the capability to produce carbon fiber could have important future applications if the centrifuge program were renewed. Another project with possible future applications in a centrifuge program was the pursuit of magnet production capability from 2000.309 Despite such activities, however, the regime did not undertake any activities directly related to a renewed nuclear program. For example, there is no available evidence that it attempted to acquire nuclear weapons or enrichment technology on the black market.310

Although these activities post-1998 did not amount to a reconstitution of the nuclear program, they could be suggestive of the intent to rebuild the nuclear program in the future, in the absence of the 2003 war. The erosion of sanctions seems to be the main explanation for the growth in activity to build the military-industrial complex – the increasing humanitarian crisis and divergence of opinion at the Security Council led to sanctions violations.311 The lack of

307 Iraq Survey Group Report, Vol. 1, “Regime Finance and Procurement”, 82-83.

308 It aimed at producing carbon fiber indigenously by refurbishing the machine, and subsequently producing another. This effort was clearly not intended for centrifuge purposes, since the smallest carbon fiber tubes would have been more than three times bigger than what was needed in centrifuges. Iraq Survey Group Report, Vol. 2, “Nuclear”, 32-33.

309 Iraq Survey Group Report, Vol. 2, “Nuclear”, 35.

310 Obeidi notes that his German contacts had been exposed by then; and the sanctions scrutiny made it nearly impossible to tap into such possible sources. Iraq’s only known contact with the Khan network was a 1990 offer from a Pakistani regarding the supply of centrifuge technology.

311 The sanctions had their most drastic effect between 1990 and 1996 when Council members remained in general agreement on their necessity, while their impact began to erode from 1997 to 2002 with the implementation of the Oil-For-Food program. Since the mid-1990s, Saddam Hussein used to his advantage what he correctly saw to be the interests of other P-5 members to contain the United States. Duelfer, Hide and Seek, 81. The divisions among Council members arose on such issues as the legitimacy of the United States in undertaking military attacks on Iraq for matters that were not explicitly authorized by the Council (such as the no-fly zones in the north and the south), and the definition of what constituted successful Iraqi cooperation and disarmament.

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inspections since 1998 was another factor facilitating these transactions, but can be considered less important in this phase since these activities revolved around obtaining materials.312

Financial Constraints

The decreasing impact of sanctions in this period – through exceptions under OFF, increased illicit activities, and declining international support for the sanctions – contributed to

Iraq’s economic revival. Between 1997 and 2000 the economy gradually recovered, and reached its pre-war levels of oil production by 1999.313 National income registered consecutively positive growth rates for the first time in the decade.314

Hussein’s main asset in seeking to erode the sanctions was the “oil card”, selectively granting contracts (especially to France and Russia) to elicit favorable responses at the Council. Not only did the regime create competition among importers in vying for Iraqi oil, it also undertook several agreements for developing the oil industry, which were to take effect only when sanctions ended. O’Sullivan, Shrewd Sanctions, 133. Since only 15 of its 73 discovered oil fields had been developed so far, there was ample scope for Iraq to award contracts for developing oil fields according to political calculations. Iraq Survey Group Report, Vol. 1, “Regime Strategic Intent”, 39. By the late 1990s Iraq began openly entering into trade agreements in blatant violation of the sanctions, signing deals with Egypt, Syria, and the UAE and beginning trade relationships with Saudi Arabia and Lebanon. O’Sullivan, Shrewd Sanctions, 135-36.

The regime also skillfully tried to increase oil prices by reducing exports, being particularly successful between November 1999 and Spring 2000. In doing so, it threatened high oil prices if the Security Council did not move toward ending sanctions. Iraq stopped oil exports altogether in November –December 1999 to try to prevent the passage of Resolution 1284, which renewed sanctions. This method helped the regime achieve some short-term objectives such as forcing the release of spare parts for the oil industry, and imposing a surcharge on its oil exports in violation of OFF. However, the regime could not sustain this tactic partly because it was difficult to correctly predict world demand and supply, and partly due to the adjustments made by other oil producers. Iraq Survey Group Report, Vol. 1, “Regime Strategic Intent”, 35-36.

312 Iraq Survey Group Report, Vol. 1, “Regime Finance and Procurement”, 57.

313 Iraq Survey Group Report, Vol. 1, “Regime Finance and Procurement, 19; O’Sullivan, Shrewd Sanctions, 131.

314 Growth rates began to decline after 2000 due to bottlenecks in oil production – years of damage and disrepair (since the Iran-Iraq war of the 1980s) had started to affect the oil-related infrastructure. In addition, the regime consciously restricted oil production in attempts to influence prices. Iraq Survey Group Report, Vol. 1, “Regime Finance and Procurement”, 21-22.

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Figure 4.5 Iraq’s GDP 1998-2003

Source: Plotted based on National Accounts Estimates of Main Aggregates, United Nations Statistics Division, http://data.un.org/.

The primary factor behind this growth was the legal as well illegal transactions under

OFF. Bilateral trade protocols were the single largest source of illicit income, with the Jordan trade protocol generating $1.7 billion from 1999 to 2003. A similar arrangement with Syria starting in 2000 earned Iraq some $2.8 billion by 2003.315 Iraq also exploited OFF to divide international unity on sanctions by selectively granting oil contracts to companies based in countries that were sympathetic to the lifting of sanctions. In general, the regime extended preferential treatment to Russian and French companies to elicit their support on the Council.

Russian firms received 32 percent of all oil contracts under OFF, while French corporations obtained 15 percent.316

315 Other trade protocols began in or after 2000 – with Turkey, and Egypt. Iraq Survey Group Report, Vol. 1, “Regime Finance and Procurement”, 25-26; 217-219.

316 The ISG report illustrates the case of a Russian colonel in the intelligence service receiving about 15 to 20 million US dollars in exchange for oil contracts for specified companies. Iraq Survey Group Report, Vol. 1, “Regime Strategic Intent”, 35, 39-40.

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At least from 2000 Iraq also earned income from ‘kickbacks’ on import contracts under

OFF, where the regime received about 10 percent more from oil exports than it actually paid for imports.317 Finally, various forms of smuggling also continued in this period.

Thus the erosion of sanctions made revenues available to the regime, which could be used for reviving the nuclear program. From the late 1990s “Saddam was free to develop illicit procurement programs to arm his Regime” since he no longer had to concentrate all resources on regime survival.318

Conclusion: Resource Constraints in 1999-2003

As shown here, Iraq was able to access some dual-use technology due to the erosion of sanctions. Improvement in the regime’s finances, also due to the waning of sanctions, increased the availability of funds for such activities. The sanctions-induced technological and financial constraints on the nuclear program declined at this time, facilitating some initial technical and industrial activities that could have applications for a renewed nuclear program. It is very likely that such activities would have further increased in the absence of sanctions. Hence sanctions contributed to resource constraints that made it hard to reconstitute the nuclear program at this time.

(b) Motivational Changes 1999-2003

Sanctions in 1999-2003 do not appear to have reduced the desire for nuclear weapons.

This likely stemmed from Saddam Hussein’s deep-seated desire for these weapons, and the fact that sanctions were less constricting at this time. Another factor that prevented motivational decline was the lack of credible reassurances that the leadership would benefit from continuing

317 Iraq Survey Group Report, Vol. 1, “Regime Finance and Procurement”, 35.

318 Iraq Survey Group Report, Vol. 1, “Regime Finance and Procurement”, 10.

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restraint. Further, the regime had become highly dysfunctional and increasingly out of touch with reality. This meant that it did not consciously undertake restraint – an activity that, if done openly, may have benefited the regime.

Despite these factors that obstructed any real motivational decline on the nuclear program, it appears that the regime made a short-term calculation that eschewed reconstituting the program. This arose from the futility of rebuilding a program from scratch, in the face of sanctions and the renewed possibility of inspections. Obeidi writes that Saddam Hussein did not renew the program at this time because he did not want to risk his newly improved situation

(following OFF), it was a daunting task to rebuild in the face of inspections and busted supply networks, and because of the absence of the individual heading the program in the past, Hussein

Kamil.319 It seems, therefore, that Saddam Hussein made a short-term calculation on the basis of excessive costs and low likelihood of success in renewing the nuclear program. Sanctions affected both these factors by increasing the costs of deception, and by making it difficult to access nuclear materials. Sanctions did not, however, persuade Saddam Hussein to give up nuclear weapons ambitions. Thus sanctions did not motivate nuclear restraint, although they helped to temporarily dissuade Hussein from renewing the program.

One factor showing the absence of motivations for restraint is the declining expectation of benefiting from restraint. Saddam Hussein did not appear to have any expectation that such restraint would help achieve the lifting of sanctions. The evolution of the US-led international campaign against Iraq in the 1990s seemed to indicate to him that Iraqi actions would never satisfy the United States so long as he was in power. From the regime’s point of view, it faced

319 Obeidi and Pitzer, Bomb In My Garden, 182-183.

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increasing demands instead of being rewarded for its ‘concessions’.320 Much of the conflict with

UNSCOM centered on the issue of whether Iraq had met its disarmament obligations as it claimed, in which case the Security Council was to end the sanctions. Saddam Hussein became increasingly frustrated by what he perceived to be the lack of reciprocity for his cooperation with inspections.321 The regime never ceased to demand an end to sanctions, but its expectation that this could be obtained progressively declined, culminating in its conclusion that sanctions would never be lifted as they were a tool for containing Iraq.322

In its final years, the regime of Saddam Hussein had become highly dysfunctional – another factor that prevented motivations for restraint. Operating in a context of an almost constant threat to one’s life – a feature of the regime since its early days, but further exaggerated in the 1990s, particularly after the defection of Hussein Kamel – officials sought to avoid displeasing their superiors.323 This resulted in a lack of clarity on the actual state of affairs

320 The mismatch between the Iraqi perspective of having cooperated significantly, and the view of UNSCOM and the Security Council that the regime was deceiving them met its peak in 1995 -- after the departure of Hussein Kamel to Jordan, the regime revealed thousands of documents on its past nuclear weapons activities as well as admitted for the first time its biological weapons program. From Saddam Hussein’s point of view, this cooperation with UN agencies was costly and forthright. From the standpoint of UNSCOM and the Security Council however, this action further undermined their confidence in regime intentions and only proved that it had been cheating so far. Iraq Survey Group Report, 49.

321 Former UN Secretary General Kofi Annan states, “They felt that whatever they did was not enough and that they had disarmed, had destroyed quite a lot of weapons, and that they were truly disarmed. But that judgment belonged to the inspectors and not to them…they feel that the resolutions are so complicated, the demands are so many that those who do not want to lift the sanctions will always find an excuse to say they have not complied. I mean we must admit that we’ve achieved a lot. I think the first inspector, Ekeus did a remarkable job, and I think – for the record—they destroyed more weapons under his inspection teams than all the bombings of the Gulf War”. Interview with Kofi Annan for Yale-UN Oral History Project, quoted in Krasno and Sutterlin, United Nations and Iraq, 127, emphasis added.

322 Charles Duelfer, interview by author, October 7, 2009, Maclean, Virginia.

323 Palkki and Smith, “Contrasting Causal Mechanisms”, 281. In the 1990s Saddam Hussein moved away from his micromanagement style to a more delegatory decision-making structure, where he allowed his subordinates to decide on some specifics. He set up a No. of committees and bodies in response to US and UN policies pertaining. Some of Iraq’s incoherent posture to UN inspections in the early 1990s is explained by tensions between members of the Committee, particularly between Hussein Kamel and Tariq Aziz on how best to respond to the UN. (Kamel advocated divulging minimum information and adopting a stance of little cooperation, while Aziz believed that some amount of compliance would be beneficial). Iraq Survey Group Report, “Regime Strategic Intent”, Vol. 1, 14). 191

regarding military capability, exaggerated successes, and gross inefficiencies. Lying to superiors, a common practice in the regime, was no longer subject to rigorous testing by

Saddam Hussein’s personal tactics due to his increasing reclusiveness in the late 1990s.324

Decision-making in this threat environment produced some counter-productive policies. For example, despite suspicions that they were intended for a renewed nuclear program, Iraq persisted in attempts to acquire high-strength aluminum tubes from abroad. This is especially strange in view of the fact that, in the latter half of 2002, Iraq launched and succeeded in indigenously developing the tubes. The Iraq Survey Group attributes this to “systematic problems such as bureaucratic inefficiencies and fear of senior officials”.325 Another example of the regime’s dysfunction was the order to move all MIC documents to the basement in

December 2002, just after inspectors had re-entered Iraq after a gap of four years. Although the documents had no relevance to WMD programs (they related to industrial and conventional weapons projects), “Saddam had needlessly reverted to concealment mode”, as if by habit.326

By the late 1990s, the routine functioning of the regime was obstructed by Saddam

Hussein’s increasing reclusiveness.327 Ultimately, Iraq’s policies reflected Saddam Hussein’s domestic management as well as his proclivities. Hussein’s ‘rationality’ appeared to differ from the Western concept in that he highly valued the future. He was “extremely patient; indeed, he

324 Iraq Survey Group Report, Vol. 1, “Regime Finance and Procurement”, 11.

325 Iraq Survey Group Report, Vol. 2, “Nuclear”, 21-29.

326 In February 2003, just before the war, the order was to destroy the MIC documents. Obeidi and Pitzer, Bomb In My Garden, 185-186; 197.

327 Iraq Survey Group Report, Vol. 1, “Regime Strategic Intent”, 56.

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used[s] time as a weapon.”328 He was a poor gambler – his calculation of the odds and their associated risks was inaccurate. Hussein’s miscalculations arose partly from his different conception of time when compared with the Western perspective. He saw time as a long durée and was willing to take short-term losses for long-term benefits.329 In any case, by the early

2000s Saddam Hussein had become “delusional”, blurring the lines between reality and imagination.330 In addition, the regime’s characteristic of being dysfunctional by the late 1990s meant that Hussein was largely out of touch with reality. Since 1998, when US calls for regime change increased, Hussein stated to advisors his belief that the American military threat against

Iraq was hollow.331

Finally, motivations for restraint may have been limited by the confusion among senior officials regarding the actual status of the nuclear program. For example, as late as December

2002 Saddam Hussein told his generals that he had something up his sleeve. Even after the US- led war began in March 2003, he conveyed that he had a secret weapon.332

Conclusion: Motivational Changes in 1999-2003

The above discussion has shown that sanctions did not persuade Saddam Hussein to give up his nuclear ambitions. However, they did delay any future reconstitution by increasing the

328 Jerrold M. Post, “Saddam Hussein of Iraq: A Political Psychology Profile” in Jerrold M. Post, ed., The Psychological Assessment of Leaders: With Profiles of Saddam Hussein and Bill Clinton (Ann Arbor: University of Michigan Press, 2003), 342.

329 Charles Duelfer, interview by author, October 7, 2009, Maclean, Virginia.

330 Hussein was apparently writing a novel in the months before the 2003 war, and had written two others in the previous two years. Obeidi and Pitzer, Bomb In My Garden, 191-192.

331 Palkki and Smith, “Contrasting Causal Mechanisms”, 283-284.

332 It appears that he may have been referring to an insurgency, which he expected to erupt among the Iraqis. Iraq Survey Group Report, “Regime Strategic Intent”, 65-66.

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threshold for obtaining materials and equipment. This potency of sanctions derived from the fact that the nuclear program had been completely eliminated by military action and inspections.

Conclusion: Sanctions and Continued Nuclear Restraint 1999-2003

In this period Saddam Hussein did not take any meaningful steps toward reconstituting the program, despite apparently retaining the desire for nuclear weapons. At this time sanctions continued to deny technology for rebuilding the nuclear program, although their financial constraints eased due to OFF. However, they still did not induce a change in motivations for nuclear weapons.

Table 4. 7 Summary of Iraq’s continued nuclear restraint 1998-2003

Causes of restraint Present? Resource Constraints: Techological Yes Did sanctions impose significant resource constraints on NW Financial Yes program? Motivational Changes: Security No Did sanctions induce motivational changes in NW program? Domestic Politics No

Prestige No

Conclusion

Taking these instances of nuclear restraint together, it is seen that sanctions did not induce motivational changes toward restraint. Although at times they did contribute to resource denial, sanctions were not the predominant cause of restraint in any instance.

Table 4.8 Final summary of Iraq’s nuclear restraint

Restraint Did sanctions impose Did sanctions induce significant resource constraints motivational changes in NW on NW program? program? Restraint 1: slow (1979- No No

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1981)

Restraint 2: rollback (Jan-Feb No No 1991)

Restraint 3: slow, stop No Yes (March-April 1991)

Restraint 4: rollback (May Limited yes333 No 1991-1998)

Continued restraint (1998- Yes No 2003)

The slowing, stopping, and rolling back of Iraq’s nuclear program were largely the result of supply-side factors – military force and intrusive inspections, which together eliminated the program and made it physically difficult to continue or reconstitute it. In the 1990s sanctions effectiveness in contributing to resource denial was underlined by the presence of these two key elements in the form of Desert Storm and Resolution 687 respectively. The former significantly damaged the nuclear program, so that continuing it now required far more technological and financial resources than would otherwise have been the case. The latter element – Resolution

687 – pegged the lifting of sanctions to the new demand on WMD disarmament. Thus Desert

Storm and Resolution 687 lent potency to the sanctions. They were the primary causes of Iraq’s nuclear rollback.

That said, sanctions did help prevent the rebuilding of the nuclear program after 1991.

Popular discontentment against the regime, strengthened by the effects of sanctions, reached new levels following the war. The leadership’s preoccupation with meeting first the external threat, and then the domestic challenges, made it difficult to renew the nuclear program. This

333 As explained earlier, sanctions did not cause nuclear rollback in 1991-98; however, they were important in preventing the rebuilding of the nuclear program at this time.

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situation lent an urgency to have the sanctions lifted, which was now pinned to UN satisfaction on WMD disarmament. Intrusive inspections under the mandate of Resolution 687 effectively incapacitated the remaining nuclear program. Thus, in the final analysis, the role of sanctions in

Iraq’s nuclear disarmament lay in preventing the rebuilding of a program that was destroyed by

Desert Storm and UN inspections.334

There is little dispute that Iraq’s economic crisis in the 1990s was principally the effect of sanctions.335 Yet these prohibitive economic costs and the concomitant threat to regime survival did not seem to affect the desire for the nuclear program. This is revealed by regime actions the moment it was able to extract revenues from oil exports. The sanctions did not convince the leadership that nuclear restraint better served its interests than nuclear pursuit. Nevertheless the weapons program was completely eliminated in the early 1990s. The experience of Iraq therefore shows that restraint is possible despite deep desires for nuclear weapons.

The role of sanctions in Iraq’s nuclear restraint can be understood as preventing the rebuilding of the program, which ended under the effects of the 1991 war and rigorous inspections.336 Thus the overall effect of sanctions was in averting the revival of the nuclear program until 1998, and delaying such efforts after 1998, when OFF provided new opportunities for sanctions evasion. Although they exerted tremendous economic and humanitarian costs, and although getting rid of sanctions was the paramount goal of the regime throughout the 1990s,

334 This conclusion is especially interesting in light of the fact that the sanctions on Iraq since the 1990s were uniquely universal and comprehensive. The sanctions literature commonly holds that sanctions tend to be more successful when they are multilateral. (Doxey 1980, 1996; Daoudi and Dajani 1983; Drezner 2000a) and affect commodities that are crucial to the target economy. In the case of Iraq, sanctions made little contribution to nuclear restraint even though they were implemented very well by most countries and involved a commodity – oil – that was vital for the economy. Doxey, Economic Sanctions; Daoudi and Dajani, Economic Sanctions; Drezner, “The Complex Causation of Sanctions Outcomes” in Steve Chan and A. Cooper Drury, eds., Sanctions as Economic Statecraft: Theory and Practice (Palgrave: Macmillan Press Limited, 2000.

335 O’Sullivan, Shrewd Sanctions, 127-128.

336 Blix, Disarming Iraq, 272.

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they did not have an overarching effect on the nuclear program and were not the primary cause of nuclear rollback.

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CHAPTER 5

TAIWAN

This chapter examines the ending of Taiwan’s nuclear weapons program in separate episodes in the 1970s and 1980s and the role of sanctions in this. While supporting existing arguments that nuclear restraint was a response to American pressure, the analysis elaborates on the causal mechanism of US influence. It identifies the significant role of sanctions in convincing the leadership to engage in restraint on three different occasions. In all three cases sanctions, or their threat, motivated restraint by manipulating external security and domestic economic factors. The analysis finds no evidence of sanctions-induced resource denial. Threats of sanctions on nuclear cooperation as well as the prospect of severing the larger economic and political relationship were the key ingredients of American pressure on Taiwan.

The chapter begins with a brief background on Taiwan, followed by a description of its nuclear program. Repeated attempts at acquiring nuclear weapons capability were driven by severe concerns on national survival. Three instances of nuclear restraint are delineated and separately studied -- Restraint 1 in 1973, Restraint 2 in 1977-1978, and Restraint 3 in 1988. The analysis shows how the regime responded to American pressure each time. The primary explanation for nuclear restraint is the change in motivations due to the threat of US sanctions,337 which persuaded the leadership that restraint was more beneficial than pursuit.

History

Taiwan, or the Republic of China, traces its roots to the Chinese civil war between the

Chinese Communist Party and the Kuomintang or Nationalist Party, which began in 1927. After

337 As explained later in the chapter, there is no publicly available evidence of the threat of US sanctions in 1988. However, it seems apparent that Taiwan succumbed to some form of American pressure at this time.

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the former’s victory in 1949, the Kuomintang (KMT) fled to the island of Taiwan, establishing itself there while continuing to claim the whole of China for the next several decades. The KMT was led by the charismatic Chiang Kai-shek, who had been an alliance partner of the United

States in the Pacific War during World War II. Chiang’s government of the Republic of China

(ROC) was accorded international recognition as a major power, obtaining a permanent seat at the UN Security Council.

The United States deepened its relations with the ROC on Taiwan with the Korean War,

“reinterpret[ing] Taiwan as part of the Cold War battleground.”338 In 1954 the two countries signed the Mutual Defense Treaty,339 according to which the United States could use its military forces to defend Taiwan and extend requisite economic and military aid. Between 1950 and

1965 the average annual nonmilitary aid of $100 million was the highest per capita aid to any country in that period.340 In 1955 Congress passed the Formosa Resolution giving far-reaching powers to the President to use the US military in defense of Taiwan.341

From the late 1960s the United States gradually withdrew economic and military assistance to Taiwan. The Nixon administration’s overtures to the People’s Republic of China

(PRC), best represented by the Shanghai Communiqué of 1972, alarmed the government on

Taiwan. The ROC faced a major crisis with the loss of its UN seat in 1971 and the concomitant

338 Denny Roy, Taiwan: A Political History (Ithaca: Cornell University Press, 2003), 105. Within two days of the start of the Korean War in 1950 President Truman announced the deployment of the Seventh Fleet to the Taiwan Strait for the purpose of preventing PRC invasion. Truman declared a policy of “neutralization” which effectively meant US military presence on the island. Richard C. Bush, At Cross Purposes: US-Taiwan Relations Since 1942 (New York: M. E. Sharpe, 2004), 89-95.

339 The treaty was concluded in the context of bombarding by the People’s Republic of China (-- mainland China ruled by the Chinese Communist Party) of the offshore islands Quemoy and Matsu. The islands held particular significance for the ROC as they were symbolic of its claim to all of China.

340 Nancy Bernkopf Tucker, Taiwan, Hong Kong, and the United States, 1945-1992: Uncertain Friendships (New York: Twayne Publishers, 1994), 54.

341 Text of the Formosa Resolution, accessed October 1, 2008, http://cns.miis.edu/straittalk/Appendix%2016.htm.

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severance of diplomatic relations with most countries. As described below, the nuclear weapons program was closely tied with these developments.

The Nuclear Program

Taiwan’s nuclear program began in the 1950s with American assistance. Until the mid-

1960s it appears to have exclusively focused on the peaceful applications of nuclear technology.

However interest in weaponization emerged after the PRC nuclear test in 1964 and was accelerated by the declining US commitment in the early 1970s. On numerous occasions the

ROC attempted to acquire plutonium reprocessing capability. Limited evidence indicates that it also pursued a uranium enrichment program. In the 1970s Taiwan agreed to give up its nuclear weapons ambitions under US pressure, dismantled its reprocessing facilities and cancelled other plans for acquiring fissile material. In the late 1980s the United States discovered another attempt at plutonium reprocessing, which was also killed under American pressure. These periods of nuclear pursuit and restraint are summed up below.

Table 5. 1 Taiwan’s nuclear program

Years Nuclear Weapons Pursuit/ Restraint 1950s-1964 Civilian nuclear program 1965-1972 Nuclear pursuit 1973 Nuclear Restraint 1 (slow) 1974-76 Nuclear pursuit 1977-1978 Nuclear Restraint 2 (stop and rollback) 1979-1986 Continued restraint 1987-1988 Attempted weapons pursuit, followed by Restraint 3 (rollback) 1988-today Continued nuclear restraint (energy program continues)

Taiwan’s nuclear program began in the 1950s focusing on the peaceful applications of nuclear energy. With assistance from the US Atoms for Peace Program it established the Atomic

Energy Council (AEC) and the Institute of Nuclear Science at the National Tsinghua University

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in 1955.342 A small 2 MW light water research reactor obtained from the United States and located at the university went critical in 1961. It was used for research and experiments, and producing radioisotopes for medicine. A second US-supplied light water research reactor (with a

30 kw capacity) for the purposes of training personnel became operational in 1971. The United

States also provided HEU fuel for the reactors.343

According to a Special National Intelligence Estimate344 Taiwan’s interest in nuclear weapons was born with the PRC nuclear test in 1964.345 Chiang Kai-shek was reportedly fearful that the PRC could destroy Taiwan in a single attack, at which point a US response would be too late. He therefore urged the United States to form an Asian defense organization.346

It appears that Taiwan’s nuclear weapons effort was pushed by a few key officials linked to the defense ministry.347 In 1965 Chiang Kai-shek apparently approved a proposal for secret nuclear weapons development, advanced by his son Chiang Ching-kuo.348 The younger Chiang became

342 Defense Intelligence Agency, Nuclear Energy Programs: Japan and Taiwan, Secret, September 3, 1974; Digital National Security Archive (George Washington University), 31, 34.

343 David Albright and Corey Gay, “Taiwan: Nuclear Nightmare Averted”, Bulletin of Atomic Scientists, 54 no. 1 (1998), 57.

344 This Special National Intelligence Estimate was produced at the request of the State Department, which may have been concerned about possible ROC interest in nuclear weapons after the US rapprochement with the PRC. William Burr, ed., US Opposed Taiwanese Bomb During 1970s, Electronic Briefing Book No. 221, (Washington, D.C.:, National Security Archive, George Washington University), June 15, 2007, http://www.gwu.edu/~nsarchiv/nukevault/ebb221/index.htm.

345 “Taiwan’s Capabilities and Intentions Regarding Nuclear Weapons Development”, Special National Intelligence Estimate, Secret, November 1972; Electronic Briefing Book No. 221, National Security Archive [NSA]; Derek J. Mitchell, “Taiwan’s Hsin Chu Program: Deterrence, Abandonment, and Honor” in Kurt M. Campbell, Robert J. Einhorn, and Mitchell B. Reiss, eds., Nuclear Tipping Point, 296; Monte Bullard and Jing-dong Yuan, “Taiwan and Nuclear Weaponization: Incentives versus Disincentives”, in Potter, ed., Forecasting Nuclear Proliferation in the 21st Century, Volume 2, 184.

346 Albright and Gay, “Taiwan: Nuclear Nightmare Averted”, 55.

347 Rebecca K. C. Hersman and Robert Peters, “Nuclear U-Turns: Learning from South Korean and Taiwanese Rollback”, Nonproliferation Review, 13 no. 3 (2006), 543-544.

348 Jay Taylor, The Generalissimo’s Son: Chiang Ching-kuo and the Revolutions in China and Taiwan (Harvard University Press, 2000), 275. 201

Minister of Defense early in 1965, the same year that the ministry established the Chungshan

Institute of Science and Technology. China’s thermonuclear explosion in 1967 spurred the

Institute to propose a $140 million plan to acquire a heavy water reactor, a heavy water production plant, and a plutonium separation plant.349 It was called the “Hsin Chu Program” after the city where the Tsinghua University and the first research reactor were located.350 An estimate for these facilities was obtained from the German firm Siemens.351

Chiang Kai-shek’s science advisor Ta-You Wu, however, apparently cautioned that the program would be too costly, that Taiwan lacked the requisite knowledge base and manpower, and that it would eventually lead to an unnecessary confrontation with the United States.352

Under Wu’s recommendation Chiang moved the proposed nuclear weapons program to the civilian Atomic Energy Council (AEC) in 1968,353 limiting the influence of the military. The nuclear program was now conducted by a new institute within the AEC called the Institute for

Nuclear Energy Research (INER) established in 1968.354 However INER seemed to have many links with the military’s Chungshan Institute. For example the original proposer of the weapons

349 Yana Feldman and Jack Boureston, “Country Profile 5: Taiwan”, Stockholm International Peace Research Institute, accessed March 22, 201,2 http://archives.sipri.org/contents/expcon/cnsc1tai.html.

350 Mitchell, “Taiwan’s Hsin Chu Program: Deterrence, Abandonment, and Honor”, footnote 7.

351 Albright and Gay, “Taiwan”, 55.

352 Ta-you Wu, “A Historical Document: A Footnote to the History of Our Country’s “Nuclear Energy” Policies”, Biographical Literature, translated from Chinese, May 1988.

353 Telegram from American Embassy, Taipei to Secretary of State, Washington D.C., February 24, 1973, Secret, Taipei 1197; Digital National Security Archives [DNSA].

354 Solingen, Nuclear Logics, 101.

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plan, Gen. Jun-Po Tang, was appointed a member of the AEC and he later headed INER.355 The

INER would later become the hub of American concerns of a nuclear weapons program.

There now appeared to be a split between the nuclear energy program, which was led by the Taiwan Electric Company or Taipower, and the advocacy of a weapons capability by the

INER and the Chungshan Institute. Both groups may have vied for political influence with

Chiang Kai-shek, and the result was inconclusive in the late 1960s356 -- Taipower launched a nuclear power program, ordering six light-water reactors from GE and Westinghouse by

1974,357 while the INER obtained a heavy water reactor from Canada in 1969.

In the 1970s Taiwan faced some major political threats, chief among them being declining

American support. President Nixon ended military aid to Taiwan in 1969, 358 began overtures to the PRC, and visited the mainland in 1972. Since the American relationship with Taiwan had been a major obstacle to normalizing relations with the PRC,359 the United States gradually decreased its economic, military, and political support to the ROC. It removed two nuclear F-4s

355 The INER was physically located at the same site as the Chungshan Institute, some 40 miles southwest of Taipei; there was no fence between them, allowing for “constant traffic”; they were guarded by a shared security force; and many senior INER members were military officers supporting nuclear weapons development. Albright and Gay, 56; Tim Weiner, “How a Spy Left Taiwan in the Cold: An Unsung American Agent Defused a Nuclear Weapons Threat”, New York Times, December 20, 1997.

356 Feldman and Boureston, “Country Profile”.

357 John Surrey, “Nuclear Power: An Option for the Third World?” Energy Policy, 16 no. 5 (1988), 469.

358 Due to the significant advances in Taiwan’s economy, the United States had already ended economic aid in 1965; and in 1967 Congress reduced funds for the military assistance program by half – Tucker, Taiwan, Hong Kong, 94, 112; Ralph N. Clough Island China (Harvard University Press, 1978), 23.

359 Premier Chou En-lai clearly told President Nixon during the latter’s trip to the PRC: “The Taiwan question is the crucial question between our two countries…” and Nixon later responded that “I realize that solving the Taiwan problem is indispensable to achieving that goal [normalizing relations with the PRC].” Memorandum of Conversation, President Nixon’s Meeting with Zhou Enlai, Top Secret, February 24, 1972, 5:15 pm- 8:05 pm, Kissinger Transcripts; Digital National Security Archive [DNSA].

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from Taiwan prior to Nixon’s 1972 mainland visit360 as part of Sino-US rapprochement.361 All

US nuclear-capable missiles stationed on Taiwan’s territory were withdrawn by 1974.362

Furthermore, the Seventh Fleet stopped patrolling the Taiwan Strait in 1970363 and the United

States began withdrawing troops after the 1972 Shanghai Communiqué.364 The Formosa

Resolution, which had authorized the president to use the US military in the defense of Taiwan, was repealed in 1974. These changes were contrary to the assurances given by President Nixon to ROC Premier Chiang Ching-kuo.365 Taiwan’s primary concern was no longer recovery of the mainland; now it was worried about its own national survival.366

Precisely in what capacity would nuclear weapons or weapons capability enhance

Taiwan’s security? The main advantage was to deter invasion by the PRC.367 Nuclear weapons

360 George H. Quester, “Taiwan and Nuclear Proliferation” in George H. Quester, ed., Before and After the Cold War: Using Past Forecasts to Predict the Future (Portland: Frank Cass, 2002).

361 The curtailment of US arms supply to Taiwan was one of Deng Xiaoping’s stipulations for full normalization between the PRC and the United States – Bush, At Cross Purposes, 160. In addition US plans to redeploy nuclear weapons from Okinawa (which was being returned to Japan) to Taiwan were cancelled due to the opening to China. Quester, “Taiwan and Nuclear Proliferation”.

362 Albright and Gay, “Taiwan Nuclear Nightmare Averted”; Richelson, Spying on the Bomb, 274.

363 Clough, Island China, 99.

364 The Shanghai Communiqué issued during Nixon’s historic trip to the PRC in 1972 for the first time officially declared US intentions to gradually reduce its military presence and the “ultimate objective of the withdrawal of all US forces and military installations from Taiwan.” Text of the Shanghai Communiqué, CNN Historical Documents, http://www.cnn.com/SPECIALS/cold.war/episodes/15/documents/us.china/. The United States agreed to “Five Principles” stipulated by Premier Chou En-lai during Nixon’s visit and he directly communicated this to the Premier – (i) “There is one China, and Taiwan is a part of China”, (ii) the United States will not support Taiwanese independent movements, (iii) the United States will attempt to discourage Japan from moving in to Taiwan as it draws down its own forces there, (iv) the United States will not support any Taiwanese military efforts to take over the mainland, and, (v) the United States seeks to normalize relations with the PRC. Memorandum of Conversation, February 22, 1972, 2:10 pm-6:00pm; NSA.

365 Memorandum of Conversation, Department of State, “Shen-Kissinger Meeting”, December 1, 1971; National Archives at College Park [NACP].

366 Clough, Island China, 31.

367 Quester, “Taiwan and Nuclear Proliferation”; Dennis Van Vranken Hickey, Taiwan’s Security in the Changing International System (Boulder: Lynn Reiner Publishers, 1997); Clough, Island China, 106, 117.

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could also be used for a kind of political warfare, to prevent the PRC from undertaking crisis escalation measures such as detonating a nuclear weapon on an uninhabited Taiwanese island.

The ROC could also gain tactically such as countering a conventional amphibious invasion by the PRC, retaliating to some provocation, enforcing territorial claims, and responding to attacks against offshore islands.368

Another motive may have been the enhanced prestige that would result from nuclear weapons possession. Nuclearization would help Taiwan reinforce its status as an independent nation by demonstrating its political viability369 and act as a “useful hedge for the unknown exigencies of the future.”370 The expulsion from the UN in 1971 was a major blow to Taiwan,371 which now became an international ‘pariah’.372 Thus nuclear weapons development may have been a way to demonstrate technological capability and strengthen sovereignty, and possibly even break its dependence on the United States.373

368 William H. Overholt, “Nuclear Proliferation in Eastern Asia” in William H. Overholt, ed., Asia’s Nuclear Future (Boulder, Colorado: Westview Press, 1977), 142-143; Lasater, US Interests in the New Taiwan.

369 Joseph A. Yager, “Taiwan” in Richard K. Betts, William B. Courtney, Henry S. Rowen, Richard Brody, and Joseph A. Yager, eds., Nonproliferation and US Foreign Policy (Washington, D.C.: Brookings Institution Press, 1980). It is also possible that ROC leaders hoped that the nuclear effort may help retain the alliance with the United States, but this motive may not have evolved until around 1976, when Premier Chiang Ching-kuo made public statements on Taiwan’s nuclear capabilities.

370 “Taiwan’s Capabilities and Intentions Regarding Nuclear Weapons Development”, Special National Intelligence Estimate, Secret, November 1972; DNSA.

371 Yu San Wang, “Foundation of the Republic of China’s Foreign Policy”, in Yu San Wang, ed., Foreign Policy of the Republic of China on Taiwan: An Unorthodox Approach (New York: Praeger, 1990), 8. Technically, the ROC withdrew from the UN a few minutes before it was expelled on October 25, 1971. It did this as a face-saving exercise, but it is commonly considered that Taiwan was expelled from the UN following General Assembly Resolution 2758, which called for this.

372 Robert E. Harkavy, “Pariah States and Nuclear Proliferation”, International Organization, 35 no. 1 (1981).

373 Quester, “Taiwan and Nuclear Proliferation”.

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Weapons Program

In the early 1970s Chiang Ching-kuo apparently ordered the hastening of the nuclear weapons effort.374 The program primarily envisaged extracting plutonium from the spent fuel of a heavy water reactor, although later there were suspicions of a uranium enrichment program.

The INER obtained a 40-megawatt heavy water reactor from Canada in 1969, which was named the Taiwan Research Reactor (TRR). It also obtained from Canada US-origin heavy water and

25 metric tons of natural uranium fuel rods.375 The TRR went critical in early 1973 just as

Canada severed its diplomatic relations with the ROC, thus removing its active supervision.376

The reactor generated concerns about ROC intent as it was an improved version of the one sold to India, which subsequently conducted a “peaceful nuclear explosion”.377 The TRR was managed by General Tang Chun-po’s deputy, Admiral Hsia Hsin, causing AEC officials such as

Secretary General Victor Cheng to complain that the reactor was being treated as a military secret.378 Moreover although the declared purpose of the reactor was for research, a credible research program seemed absent.379 IAEA inspections in the 1970s concluded that the purpose of the program was ambiguous although there had not been any obvious diversion for nuclear weapons purposes.380

374 Taylor, The Generalissimo’s Son, 317.

375 Albright and Gay, “Taiwan”, 57.

376 Tucker, Taiwan, Hong Kong, 146.

377 Gerald Waring, “Canadians Selling Reactor to Taiwan”, Washington Post, September 17, 1969.

378 Telegram from American Embassy, Taipei to Secretary of State, Washington D.C., “Chung Shan Nuclear Research Institute”, February 24, 1973, Secret, Taipei 1197; NSA.

379 Telegram from American Embassy, Taipei to Secretary of State, Washington D.C., “Chung Shan Nuclear Research Institute”, February 24, 1973, Secret, Taipei 1197; NSA.

380 Cable from American Embassy, Tokyo to Department of State, “ROC/IAEA Safeguards”, March 8, 1977, Cable 3212; NSA.

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The INER began building supportive facilities for the TRR in 1969 using equipment from

France, Germany, the United States, Norway, and others.381 A fuel fabrication plant began operating in 1972 or 1973 for the purpose of producing natural uranium fuel for the TRR.382

The biggest concern about possible weaponization was generated by INER attempts to develop some reprocessing capability, the plans for which are unclear. Taiwan was denied a request for a reprocessing plant from the United States in 1969. It made a similar attempt with a German firm.383 The deal came to light in early 1973 just as the TRR became operational, thus raising much US concern about the intent to weaponize.384 Taiwan cancelled the plan under American pressure, discussed in this chapter as part of Restraint 1.385

Other attempts at acquiring a reprocessing plant were made with French and Dutch firms.386 In 1970 the ROC started constructing a reprocessing laboratory consisting of a single hot cell, which started operating around 1976.387 It could process gram quantities of

381 Albright and Gay, “Taiwan”, 57.

382 Since Taiwan had no indigenous sources of uranium, it bought 100 metric tons of uranium from South Africa between 1972 and 1974. Telegram from American Embassy, Taipei to Secretary of State Washington DC, “Chung Shan Nuclear Research Institute”, February 24, 1973, Secret, Taipei 1197; NSA.

383 Telegram from American Embassy, Taipei to Secretary of State, Washington D.C., “Chung Shan Nuclear Research Institute”, February 24, 1973, Secret, Taipei 1197; NSA. The deal was to acquire a pilot reprocessing plant that was capable of reprocessing 50 tons of spent fuel (presumably from the TRR) per year. Bureau of Intelligence and Research, Department of State, Nuclear Weapon Intentions of the Republic of China, Report, February 15, 1973, Secret, 2; NSA.

384 Telegram from American Embassy, Taipei to Secretary of State, Washington D.C., “Chung Shan Nuclear Research Institute”, February 24, 1973, Secret, Taipei 1197; NSA.

385 Bureau of Intelligence and Research, Nuclear Weapon Intentions of the Republic of China; NSA.

386 Cable from State Department, Washington D.C. to American Embassy, Taipei, “Taiwan’s Continued Interest in Reprocessing”, January 8, 1977, Secret Exdis, Cable 4532; NSA.

387 A hot cell is a lead-shielded room with remote-handling equipment for processing radioactive materials. The plant was apparently being constructed with components obtained from the United States, Japan, and Europe . Cable from American Embassy, Taipei to State Department, Washington, D.C., “ROC’s Nuclear Intentions: Conversation with Premier Chiang Ching-Kuo”, September 15, 1976, Cable 6272, Secret Nodis; NSA.

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plutonium.388 Taiwan needed American permission to operate the laboratory (commonly referred to as the “hot lab”) as it would use the spent fuel of the US supplied Tsinghua reactor.389 Although the US Atomic Energy Commission had originally given “tentative[ly” approval, final authorization was delayed due to American concerns about Taiwan’s intent to develop a larger reprocessing capability.390

Taiwan also built a smaller reprocessing lab with Norwegian help, and a Plutonium Fuel

Chemistry Laboratory with the help of a French firm. This involved four gloveboxes,391 one of which could produce plutonium metal.392 The lab started operating in 1975 or 1976 using some

1, 075 grams plutonium supplied by the United States.393

In addition there were rumors of limited reprocessing activity at other labs.394 The United States learned of renewed efforts at reprocessing in 1976. Again as a result of US pressure, Taiwan

388 According to AEC Secretary-General Victor Cheng the plant would produce about 300 grams of plutonium per year. It would help Taiwanese scientists gain experience and training. Cable from State Department, Washington D.C. to Embassies in Taipei and Tokyo, “ROC Nuclear Research”, March 21, 1973, Secret, Cable 51747; NSA. Central Intelligence Agency, Prospects for Arms Production and Development in the Republic of China, Interagency Intelligence Memorandum, May 1976, 9, accessed March 1, 2012, http://www.foia.cia.gov/docs/DOC_0001115733/DOC_0001115733.pdf .

389 Fox Butterfield, “Taiwan Denying Atomic Operation”, New York Times, September 5, 1976. In 1975 the United States denied permission to use some of the US-supplied HEU fuel for reprocessing. Albright and Gay, “Taiwan”, 57.

390 Butterfield, “Taiwan Denying Atomic Operation”.

391 A glove box is a box with a lead glass window fitted with gloves into which hands can be inserted for reprocessing plutonium in the box. The hot cell and glove box together enable lab-scale plutonium reprocessing.

392 The capability to produce plutonium metal was significant since it has few civilian applications. Albright and Gay, “Taiwan”, 57.

393 Albright and Gay, “Taiwan”, 57.

394 A 1976 CIA report states, “there have been sporadic reports and some physical evidence that small amounts of fuel from the reactor [TRR] are being reprocessed at other hot laboratories to obtain plutonium, but the amounts recovered would be extremely small.” Central Intelligence Agency, Prospects for Arms Production and Development in the Republic of China, 9.

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cancelled plans to acquire a large reprocessing plant by 1977 (Restraint 2). Privately, however,

Chiang Ching-kuo apparently ordered that research on reprocessing continue.395

After the 1982 US communiqué with the PRC in which it agreed to gradually reduce arms supplies to Taiwan,396 Chiang Ching-kuo is believed to have instructed the military to increase weapons development and to give priority to nuclear weapons.397 Another instance of reprocessing-related activities surfaced in 1987, when the United States obtained evidence that

Taiwan was once again seeking to build a plant to reprocess plutonium from the spent fuel of the TRR.398 This effort also ended under US pressure, classified as Restraint 3 in this chapter.

Motivations for restarting the weapons attempt in the 1980s are unclear. The renewed effort was exposed after the 1987 defection to the United States of INER deputy director Col. Chang

Hsien-yi. American security commitments had declined since the mid-1970s – the United States severed diplomatic relations with the ROC in 1979, and abrogated the Mutual Defense Treaty in

1980. In 1982 the United States issued a communiqué on curbing arms sales to Taiwan. In addition although Chiang Ching-kuo had agreed in the late 1970s to measures such as the transfer of spent fuel to the United States, the actual transfer did not occur till 1985 after financing issues were settled. It was announced in 1987 that the remaining spent fuel from the

395 Taylor, The Generalissimo’s Son, 324.

396 The communiqué stated that the United States “intends to reduce gradually its sales of arms to Taiwan, leading over a period of time to a final resolution.” Text of Sino-US Joint Communiqué on Arms Sales to Taiwan, August 17, 1982, Nuclear Threat Initiative Research Library, accessed October 8, 2008, http://www.nti.org/db/china/engdocs/commk82.htm.

397 Taylor, The Generalissimo’s Son, 373.

398 Leonard S. Spector, The Undeclared Bomb (Cambridge: Massachusetts, Ballinger Publishing Company, 1988).

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TRR would soon be brought to the United States, and this could have precipitated the nuclear weapons attempt. The effort ended under US intervention by March 1988.399

Suspicions of a secret uranium enrichment program emerged in the late 1970s.400 There is no public information on the nature or extent of this effort. However, the United States was deeply concerned and increased its pressure on Taiwan, which apparently cancelled such activities by 1978. This is also discussed as part of Restraint 2 in the chapter.

In the late 1970s the United States also believed that the INER was conducting research in nuclear weapons design. Scientists at Chungshan worked out extensive design calculations and experiments for a nuclear device, successfully developing a design by September 1975.401

Safeguards

Under a bilateral nuclear cooperation agreement with the United States since the 1950s,

IAEA safeguards applied to US nuclear supplies to Taiwan.402 Taiwan also signed the NPT soon after it opened for signature in 1968 and ratified it in1970. However its official status in the

NPT ceased after it was expelled from the UN in 1971, when its membership in the IAEA was automatically terminated. In March 1972 Taiwan entered into a trilateral agreement with the

IAEA and the United States, according to which its nuclear program would be for peaceful purposes.403 Having lost its international recognition as an independent state, Taiwan was now

399 Spector, Undeclared Bomb.

400 Bullard and Yuan, “Taiwan and Nuclear Weaponization”, 194.

401 Central Intelligence Agency, Prospects for Arms Production and Development in the Republic of China, 9.

402 The agreement also required the ROC to obtain US permission for reprocessing. Testimony by Fred Ikle, Director, Arms Control and Disarmament Agency, to the Subcommittee on Arms Control, International Organizations and Security Agreements, Senate Committee on Foreign Relations, September 22, 1976, 1-9.

403 International Atomic Energy Agency, Text of the Agreement between the International Atomic Energy Agency, the Government of the Republic of China, and the Government of the United States of America for the Application of Safeguards, IAEA Information Circular, INFCIRC/158, March 8, 1972, accessed August 1, 2008, 210

unofficially afforded the status of a non-nuclear weapon state within the NPT.404 In the 1990s,

Taiwan also began implementing the Additional Protocol soon after it was formed.405

Canadian safeguards that were monitoring the Taiwan Research Reactor (TRR) were terminated after Canada ended diplomatic relations with the ROC in 1971. Instead the TRR and associated facilities were covered by new IAEA safeguards, which included any reprocessing activities based on TRR spent fuel.406

Ultimately three separate agreements formed the basis of safeguards on Taiwan’s nuclear facilities – a bilateral understanding with the United States on the operation of US Government safeguards on American supplied facilities;407 a trilateral agreement with the United States and the IAEA covering the same reactors; and a third agreement with the IAEA covering the TRR and other nuclear materials under IAEA safeguards. The following section lists the sanctions on

Taiwan, followed by an assessment of each instance of restraint.

http://www.iaea.org/Publications?Documents/Infcircs/others/infcirc158.pdf; International Atomic Energy Agency, IAEA Annual Report for 1997 (Vienna: IAEA), Annex, 86.

404 Center for Nonproliferation Studies, “Taiwan”, accessed April 30, 2012, http://cns.miis.edu/inventory/pdfs/taiwan.pdf .

405 Institute for Science and International Security, Taiwan’s Former Nuclear Bomb Program Revealed, ISIS Report (Washington, D.C.: ISIS) December 19, 1997, accessed April 30, 2012, http://isis-online.org/isis- reports/detail/taiwans-former-nuclear-bomb-program-revealed/15.

406 Testimony by Fred Ikle, Director, Arms Control and Disarmament Agency, to the Subcommittee on Arms Control, International Organizations and Security Agreements, Senate Committee on Foreign Relations, September 22, 1976, 1-9; Melinda Liu, “Taiwan’s Power Game”, Far Eastern Economic Review, December 17, 1976.

407 This was based on amendments to a 1955 nuclear cooperation agreement between the ROC and the United States, which declared that any material, device, or equipment supplied by the United States would be used for civilian purposes alone, and allowing for the return of all such supplies in the event of non-compliance of the agreement by the ROC. It also provided for the return of all US-supplied resources if the trilateral agreement is terminated. See “Text of the Agreement for Cooperation between the Government of the United States of American and the Government of the Republic of China Concerning Civil Uses of Atomic Energy”, April 4, 1972, accessed August 1, 2008, https://www.carnegieendowment.org/static/npp/treaties/taiwan_123.pdf.

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Sanctions

Diplomatic encounters between American and ROC officials on several occasions in the

1970s conveyed the threat of sanctions on nuclear cooperation. In 1977-78 they entailed reference to a possible jeopardizing of the political and military relationship between the two countries. While the overwhelming majority of these sanctions remained in the form of threats, the United States also delayed the supply of some components for the nuclear program -- it delayed export licenses for HEU fuel for the US-supplied research reactor, as well as for two new nuclear power plants.408 These delays, which were for the purpose of persuading nuclear restraint,409 are regarded here as sanctions.410 Thus the US sanctions on Taiwan involved actual delays in the supply of technology for the nuclear power program, and threatened sanctions on nuclear cooperation as well as the larger economic and political relationship. The specific instances of sanctions are summed up in the table below, and are discussed in greater detail later in the chapter.

408 The United States delayed export licenses for nuclear fuel, which Taiwan had purchased in 1975. It also delayed licenses for approving the export of two nuclear power plants, the application for which had been submitted in January 1976. The United States had already approved the export of four large nuclear energy plants in 1972 and 1974. Butterfield, “Taiwan Denying Atomic Operation”; Edward Schumacher, “Taiwan Seen Reprocessing Nuclear Fuel, Washington Post, August 29, 1976.

409 According to a Washington Post article, “ACDA officials said they have been stalling on an application to export two additional nuclear power plants to Taiwan, a move they hope will be taken by Taiwan as a signal to stop secret reprocessing.” Schumacher, “Taiwan”.

410 Existing studies on Taiwan’s nuclear restraint do not generally refer to US pressure on Taiwan as “sanctions”. One important exception is Hufbauer, et. al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM. This explicitly considers the impact of US sanctions on Taiwan, viewed in terms of the delayed supply of nuclear materials. Since the dissertation defines sanctions as the deliberate government withdrawal or threat of withdrawal of customary economic relations to seek change in a particular policy, US pressure – both the delay in nuclear exports and the threat of terminating the overall bilateral relationship – is considered here as sanctions. This is supported by the fact that the United States refereed to its own threats as ‘sanctions’ – Head of the US visiting team Burton Levin (State Department ROC desk) told Vice Foreign Minister Chien that “sanctions” on nuclear as well as other relations would follow if the ROC did not comply with US demands. Cable from American Embassy, Taipei to State Department, Washington D.C., "US Nuclear Team Visit to ROC - Calls," January 19, 1977, Confidential, Cable 332; NSA.

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Table 5. 2. US sanctions on Taiwan

Date Details of US Sanctions on Taiwan Type of Sanctions Jan. US Ambassador McConaughy threatens that Taiwan will lose US Threatened 1973 nuclear cooperation if it continues with a deal with a German firm to nuclear get a reprocessing plant with capability to reprocess 50 tons spent sanctions fuel annually.

March Deputy Assistant Secretary of State Richard Sneider tells Taiwan’s Threatened 1973 AEC Secretary General Victor Cheng that US nuclear cooperation is nuclear based on the condition that the nuclear program is only for peaceful sanctions purposes.411

Nov. Visiting US nuclear team conveys threat that ROC will lose US Threatened 1973 nuclear cooperation if it continues with purchase of reprocessing nuclear facility. sanctions

1976 US delays export licenses for HEU fuel and two additional nuclear Imposed power plants;412 denies permission to use previously supplied HEU nuclear fuel in hot cell reprocessing laboratory.413 sanctions

Sept. Ambassador Unger conveys threat of US sanctions on nuclear Threatened 1976 cooperation (if reprocessing attempts continue) to ROC Foreign nuclear, Minister Shen, and threatens possible future suspension of economic economic & and military aid. political sanctions

Jan. US officials tells ROC Vice Foreign Minister Frederick Chien that Threatened 1977 failure to comply with US stipulations would result in sanctions economic & affecting a broad range of issues including the bilateral security political relationship.414 sanctions

March Ambassador Unger tells Premier Chiang Ching-kuo that the ROC Threatened 1977 risks cessation of US nuclear cooperation and “other nuclear,

411 Cable from State Department, Washington D.C. to Embassies in Taipei and Tokyo, “ROC Nuclear Research”, March 21, 1973, Secret, Cable 51747; NSA.

412 In 1972 and 1974 the United States had approved the sale of four nuclear energy plants . Export licenses for two other reactors were delayed in 1976, but eventually granted, with the reactors beginning operations in 1978 and 1979 respectively. Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM; Schumacher, “Taiwan”; Surrey, “Nuclear Power”, 466.

413 Butterfield, “Taiwan Denying Atomic Operation”.

414 Cable from American Embassy, Taipei to State Department, Washington D.C., "US Nuclear Team Visit to ROC - Calls," January 19, 1977, Confidential, Cable 332; NSA.

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important relationships” unless it “significantly modified” its nuclear economic, & program.415 political sanctions

July Ambassador Unger tells CIST Director Gen. Tang that under the Threatened 1978 newly passed Nuclear Non-Proliferation Act, the United States nuclear would terminate nuclear exports to any country that had violated the sanctions terms of a bilateral agreement.

Restraint 1 – (Slow) 1973

In 1973 US pressure on Taiwan led to the cancellation of attempts to acquire a reprocessing plant. In February 1973 ROC Foreign Minister James Shen told American

Ambassador William McConaughy that a proposed deal with a German firm had been cancelled under American pressure, which involved the threat of sanctions on nuclear cooperation. In

November 1973 the ROC cancelled another plan to acquire a reprocessing plant -- this time with a French firm -- under renewed threat of US nuclear sanctions.

Restraint in this period is categorized as ‘slow’ since evidence indicates that the ROC did not fully abandon its deals with European firms. Although the German deal appears to have been completely aborted, negotiations on the second contract may have continued.416 This phase of restraint is not categorized as ‘stop’ because, just months later, the United States believed that the ROC had a nuclear weapons program.417 The repeated attempt to acquire some reprocessing capability suggests that interest in continuing the nuclear weapons effort persisted at least after the first US demarche or diplomatic protest. The following pages narrate these developments,

415 Cable from Secretary of State to American Embassy, Taipei, March 26, 1977, Secret Nodis, Cable 67316, “Nuclear Representation to the ROC”; NSA.

416 As discussed later in the chapter, in 1976 it resurfaced as a major concern for the United States, with evidence that the ROC was pursuing reprocessing technology with a Dutch firm.

417 In 1974 the CIA believed that “Taipei conducts its small nuclear program with a weapon option clearly in mind, and it will be in a position to fabricate a nuclear device after five years or so.” – quoted in Albright and Gay, “Taiwan”, 57.

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and then consider the relative roles of resource constraints and motivational changes in Restraint

By early 1973 the State Department received reports from Bonn that Taiwan had signed a contract with the German firm Uhde-Lurgi for components for a plant capable of reprocessing

50 tons of spent fuel annually.418 This led to the first formal encounter or demarche between the

United States and the Republic of China on the nuclear issue with Ambassador Walter

McConaughy meeting Foreign Minister Shen Chang-huan twice in January 1973. The

Ambassador conveyed US disapproval of the proposed plan for reprocessing capability and the

Foreign Minister responded that the ROC had not yet made a final decision on the purchase.419

In order to underline the seriousness of the US position and to discourage future such attempts, the State Department instructed Ambassador McConaughy to make a second presentation about two weeks later.420 The Ambassador was to specify that, under their bilateral agreement on nuclear cooperation, the ROC could not reprocess any fuel of US origin without appropriate safeguards.421 McConaughy told Shen that continuing to seek the reprocessing facility would be at “the risk of jeopardizing the ROC’s projected four great nuclear power

418 Cable from State Department, Washington, D.C. to Embassies in Bonn, Brussels, and Taipei, January 20, 1973, Cable 12137, Secret; NSA.

419 American embassy officials felt “reasonably encouraged by Shen’s response and believe[d] that ROC will think hard before trying to go ahead in face of explicit US opposition to reprocessing plant.” Telegram from American Embassy, Taipei to State Department, Washington D.C., “Proposed Reprocessing Plant for Republic of China”, January 16, 1973, Confidential, Cable 338; NSA.

420 Cable from State Department, Washington, D.C. to Embassies in Bonn, Brussels, and Taipei, January 20, 1973, Cable 12137, Secret; NSA.

421 The Ambassador was referring to the US-ROC agreement on nuclear cooperation of 1955 as amended on April 4, 1972. Although safeguards could technically be instituted, the United States was concerned about the uncertainty surrounding the nature of IAEA safeguards in Taiwan, given that it was no longer an official member of the UN (as of October 1971). Indeed since 1971 the United States had become “the ultimate legal guarantor of Taiwan’s non- nuclear status – facilitated by IAEA inspections”. Cable from State Department, Washington, D.C. to Embassies in Bonn, Brussels, and Taipei, January 20, 1973, Secret, Cable 12137; NSA; Mitchell, “Taiwan’s Hsin Chu Program”, 298.

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plants which are of overriding consequence to the future of the entire ROC economy” and conveyed the threat of sanctions on US nuclear cooperation in the form of denying equipment and fuel for the proposed nuclear energy plants.422 Foreign Minister Shen responded that

Taiwan had no intention to develop nuclear weapons or weapons capability, and that it was merely seeking a reliable supply of fuel for its nuclear power reactors.423

The United States also approached Germany to cancel the sale. American diplomats in

Bonn were instructed to press on West Germany that the proposed deal was “highly undesirable” without appropriate safeguards, urging the German government not to authorize it.424 The US Ambassador to W. Germany conveyed this message in January 1973, and in

February he reported that the firm Uhde-Lurgi had cancelled the deal under pressure from the

German Foreign Office.425 The US government also asked Belgium not to authorize proposals for architectural and engineering services from a Belgian firm in support of the planned reprocessing plant by Taiwan.426

In February 1973 Foreign Minister Shen informed McConaughy that the plan for the reprocessing deal had been cancelled in keeping with US wishes. He therefore expected that,

422 Ambassador McConaughy also stated that the United States was concerned “as a friend and supplier”; and that bilateral nuclear cooperation would be threatened if IAEA safeguards were jeopardized. Cable from American Embassy, Taipei to State Department, Washington D.C., “Proposed ROC Reprocessing Plant”, January 31, 1973, Secret, Cable 685; NSA.

423 Cable from American Embassy, Taipei to State Department, Washington D.C., “Proposed ROC Reprocessing Plant”, January 31, 1973, Secret, Cable 685; NSA.

424Cable from State Department, Washington, D.C. to Embassies in Bonn, Brussels, and Taipei, “Proposed Reprocessing Plant for Republic of China”, January 4, 1973, Confidential, Cable 2051; NSA.

425 William Burr, “New Archival Evidence on Taiwanese “Nuclear Intentions”, 1966-1976, Electronic Briefing Book No. 19, (Washington, D.C.:, National Security Archive, George Washington University), October 13, 1999.

426 Cable from State Department, Washington, D.C. to Embassies in Bonn, Brussels, and Taipei, “Proposed Reprocessing Plant for Republic of China”, January 4, 1973, Confidential, Cable 2051; NSA; Richelson, Spying on the Bomb, 267; Cable from State Department, Washington, D.C. to Embassies in Bonn, Brussels, and Taipei, January 20, 1973, Secret, Cable 12137; NSA.

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contrary to the previous threat, the United States would supply Taiwan with all aspects for its nuclear energy program.427 In March 1973 Deputy Assistant Secretary of State Richard Sneider reiterated the threat of US sanctions on nuclear cooperation when he told AEC Secretary-

General Victor Cheng that continued US nuclear cooperation depended on the ROC limiting its program to peaceful purposes.428

In August 1973 the United States learned from ROC officials of plans to establish a reprocessing plant after 1985, beginning now with training personnel. This was conveyed by

Secretary General Victor Cheng of Taiwan’s AEC and Taipower Electric Company’s David

Chu during a visit to Washington DC.429 They expressed concerns about developing an indigenous reprocessing capability in the future for the purpose of generating fuel for

Taipower’s planned nuclear reactors. This led to the United States extending a second demarche, conveyed immediately by American officials to Victor Cheng in Washington DC. It was also communicated to ROC Foreign Minister James Shen in Taipei.430 Dr. Abraham

Friedman, Director of International Programs at the US AEC, told Victor Cheng of Taiwan’s

AEC and David Chu of Taipower that Taiwan’s nuclear energy program would be jeopardized by the pursuit of reprocessing capability.431 Friedman specified that, given Taiwan’s changing international status, the IAEA was already under pressure to withdraw safeguards, an eventuality that would almost certainly occur if Taiwan proceeded with its reprocessing plans.

427 Cable from American Embassy, Taipei to State Department, “ROC Decides Against Purchase of Nuclear Reprocessing Plant”, 8 February 1973, Secret, Cable 828, NSA.

428 Cable from State Department, Washington D.C. to Embassies in Taipei and Tokyo, “ROC Nuclear Research”, March 21, 1973, Secret, Cable 51747; NSA.

429 Taipower was the state-owned electric utility.

430 State Department Memorandum, “Nuclear Study Group to Visit Taiwan”, October 29, 1973, Secret; NSA.

431 State Department Memorandum of Conversation, “ROC Nuclear Energy Plans”, August 29, 1973, Secret; NSA.

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References were made to Taiwan’s evolving “critical dependence on nuclear power reactors”, which would be jeopardized if it continued with plans for a reprocessing capability.432 Assistant

Secretary of State Arthur Hummel echoed these concerns with Cheng.433

In September 1973 Cheng conveyed an alteration of plans, that Taiwan would use British reprocessing facilities, and that the reprocessed plutonium would then be shipped to the United

States for storage or for fabricating new fuel.434

However in October 1973 the State Department learned that Taiwan was continuing its quest for a reprocessing capability, this time with a French firm Sant Gobain Nucleaire. It was unclear if this effort had occurred after the August demarche.435 A formal protest was lodged at the end of a visit by an American nuclear team in November 1973. American officials explicitly linked the continuing of a possible weapons effort with Taiwan’s loss of US nuclear cooperation

– American officials stated, “we could not otherwise ensure kind of cooperation necessary for nuclear power program”.436 At the end of the team’s visit, Ambassador McConaughy, Deputy

Chief of Mission William Gleysteen, Dr. Abraham Friedman all conveyed to Foreign Minister

432 Cable from American Embassy, Taipei to State Department, Washington D.C., November 23, 1973, Secret, Cable 7051; NSA.

433 He told Cheng that the United States was concerned about Taiwan’s reprocessing plans as well as training of personnel, and that acquiring a reprocessing plant would jeopardize Taiwan’s links with the IAEA and the safeguards program. Cable from State Department to American Embassy, Taipei, “Call on US Secretary Hummel by Victor Cheng”, September 4, 1973, Secret; NSA.

434 State Department Memorandum, “Nuclear Study Group to Visit Taiwan”, October 29, 1973, Secret; DNSA. The plan to reprocess plutonium at British facilities was generally considered acceptable by the United States. State Department Memorandum of Conversation, “ROC Nuclear Energy Plans”, August 29, 1973, Secret; DNSA. However it was later cancelled under the US demand that Taiwan avoid all reprocessing. Yager, “Taiwan”, 68.

435 State Department Memorandum, “Nuclear Study Group to Visit Taiwan”, October 29, 1973, Secret; NSA.

436 Cable from American Embassy, Taipei to State Department, Washington D.C., November 23, 1973, Secret, Cable 7051; NSA.

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Shen the importance of the US position.437 The Foreign Minister responded that the nuclear program would be limited for peaceful purposes, that Taiwan would not proceed to acquire reprocessing capability in the face of US opposition, and that the “ROC knew its limits and would not be so foolish as to jeopardize US nuclear cooperation without which they could not succeed.”438 Deputy Chief of Mission William Gleysteen wrote, “the exercise was worthwhile and successful”.439 Taiwan never acquired the plant. Thus in 1973 an important aspect of the planned weapons effort was suspended under American pressure.

Restraint 1: Motivational or Resource Driven?

Both resource constraints and motivational factors appear to have been important contributors to Restraint 1. The cancellation of the deal with the German firm Uhde-Lurgi in early 1973 implies at least a partial operation of resource constraints, since it was the result of the German government pressuring the firm (which was in turn pressured by the United

States).440 The fact that Taiwan renewed efforts to set up a reprocessing plant a few months later strongly suggests that the motivation for a weapons option continued at this time i.e. after the first US demarche in January 1973.

437 Ambassador McConaughy noted the ROC’s evolving “critical dependence” on nuclear energy reactors, for which it in turn depended on the United States. Deputy Chief of Mission Gleysteen stated that the United States “wished ROC to observe even stricter standards than other countries and to go out of its way to remove any ambiguity because we could not otherwise ensure the kind of cooperation necessary for the nuclear power program. We were asking not only that ROC desist from seeking reprocessing capability but also that it cease minor activities which implied continued interest in this direction”. Cable from American embassy, Taipei to Secretary of State, Washington D.C., Secret, Cable 7051; NSA.

438 Cable from American Embassy, Taipei to State Department, November 23, 1973, Secret, Cable 7051.

439 Letter from William H. Gleysteen, Jr., Deputy Chief of Mission, US embassy in Taipei, to Thomas Bleha, Esquire, Deputy Director, Republic of China Affairs, State Department, November 23, 1973, Official-Informal, Secret; NSA.

440 William Burr, New Archival Evidence on Taiwanese Nuclear Intentions, October 13, 1999; NSA.

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However the second element of restraint relating to reprocessing technology from the

French firm Sant Gobain later in 1973 likely stemmed from motivational changes. As of now, there is no obvious evidence that this effort was cancelled due to resource constraints. Rather, the decision to call off the attempt appears to have revolved around the threat of losing US support for Taiwan’s nuclear power program. (These effects are explained in greater detail under the section on the sanctions impact in Restraint 1.) Thus Restraint 1 involved both resource constraints and motivational changes.

Sanctions possibly affecting Restraint 1

Sanctions in Restraint 1 were in the form of the threat of US sanctions on nuclear cooperation with Taiwan. The table below lists the sanctions that could have contributed to

Restraint 1, and this is followed by an assessment of the role of sanctions in this phase.

Table 5. 3 US sanctions on Taiwan 1973

Demarche 1 (Threatened Nuclear Sanctions) Jan. Ambassador McConaughy tells Foreign Minister Shen that US opposes deal 1973 from German sources for components and design of reprocessing plant; McConaughy threatens that Taiwan will lose US nuclear cooperation if it continues with the deal.

Feb. Foreign Minister Shen tells McConaughy that reprocessing plan is cancelled due 1973 to US desire; expects US nuclear cooperation to continue.

March Deputy Assistant Secretary of State Richard Sneider tells AEC Secretary 1973 General Victor Cheng that US nuclear cooperation is based on the condition that the ROC nuclear program is only for peaceful purposes.441

Demarche 2 (Threatened Nuclear Sanctions)

August Assistant Secretary of State Hummel tells Victor Cheng that US disapproves 1973 proposed reprocessing deals.

441 Cable from State Department, Washington D.C. to Embassies in Taipei and Tokyo, “ROC Nuclear Research”, March 21, 1973, Secret, Cable 51747; NSA.

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Nov. During visit by US nuclear team to Taiwan, US officials convey the threat that 1973 ROC will lose US nuclear cooperation if it continues with the purchase of a reprocessing facility.

Sanctions and Restraint 1

Given that US sanctions were not enforced, it is obvious that the sanctions did not deny resources for the nuclear weapons program.442 This section therefore limits the analysis to the role of sanctions in the motivational factors favoring restraint in 1973, assessing whether they lay principally in the security, domestic politics, or prestige models.

The motivational factors driving Restraint in 1973 can best be understood as arising from security and domestic political considerations. It is commonly held that restraint was caused by the threat of losing US support, on which Taiwan depended for its political and economic survival.443 The influence of the United States was exerted both directly by pressuring Taiwan, and indirectly by pressing on Germany and France to refrain from supplying reprocessing technology. The US pressure on Taiwan – the threat of sanctions – appears to have borne fruit as both external and domestic considerations favored restraint. The following sections discuss these motives for restraint.

Security Model

Security factors driving restraint were based on the American security guarantee for the

ROC. Taiwan’s dependence on the United States increased after it was expelled from the UN in

1971 – an event that was accompanied by the gradual de-recognition of the ROC by several

442 As discussed in the theory chapter, sanctions-induced resource denial can only take place with sanctions that are actually enforced, not merely threatened. The resource constraint in Restraint 1 referred to above stemmed from US pressure on supplier countries rather than the threat of sanctions on Taiwan.

443 Solingen, Nuclear Logics; Bullard and Yuan, “Taiwan and Nuclear Weaponization”; Mitchell, “Taiwan’s Hsin Chu Program”.

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countries.444 The United States then became Taiwan’s sole lifeline.445 In fact, one of Taiwan’s responses to the changing international situation was to seek a strengthening of its bilateral relationship with the United States.446

Apart from these political considerations, the evolving international isolation projected economic reasons for ROC dependence on the United States.447 As early as the 1960s Chiang

Kai-shek had viewed economic progress as a means of defense.448 An indication of the perceived importance of economic matters is the decline in the proportion of government income spent on defense.449 In fact one factor that kept ROC officials from being too critical of changing US foreign policy450 was the concern that this would dampen American trade and investment.451 While dissatisfied with the declining American commitment, ROC officials were

444 With the expulsion from the UN in 1971, more and more countries broke off diplomatic relations with the ROC. In 1968 both Taiwan and the PRC had diplomatic relations with 45 countries each; by 1979 this changed to 117 countries for the PRC and only 24 for Taiwan . Roy, Taiwan: A Political History, 133.

445 As the State Department observed, “As its support elsewhere dwindles the GRC [Government of the Republic of China] relies more and more on the United States as its link to the “official” world community and as its main mediator and advocator therein. It has asked the US to help slow the pace of the ROC’s diplomatic isolation, hopeful that the passage of time will dilute the pain on Taiwan.” Bureau of Intelligence and Research, State Department, Intelligence Note, November 8, 1972; NACP.

446 Telegram from American embassy, Taipei to Secretary of State, Washington, D.C., November 17, 1971, Taipei 5692; NACP.

447 According to a telegram from the American embassy in Taipei: “…Taiwan’s prosperity and our economic relationships with the island have been indispensable in sustaining the ROC through the turbulent process of its diplomatic isolation.” Telegram from American embassy, Taipei to Secretary of State, Washington, D.C., May 25, 1973, Taipei 3088; NACP.

448 Yongping Wu, A Political Explanation of Economic Growth: State Survival, Bureaucratic Politics, and Private Enterprises in the Making of Taiwan’s Economy, 1950-1985 (Cambridge: Harvard University Press, 2005), 187.

449 Nevertheless security always remained an important consideration for the ROC government. Defense spending as a proportion of the national budget fell from 62 percent in 1958 to 43 percent in 1972. Cal Clark, Taiwan’s Development: Implications for Contending Political Economy Paradigms (Westport, Connecticut: Greenwood Press, 1989), 186.

450 In the early 1970s the United States moved to normalize relations with the PRC.

451 An embassy cable noted that the ROC was aware “that vital American trade and investment could be jeopardized by deteriorating relations between the two nations. The essential nature of U.S. political support and military 222

careful to avoid further alienating the United States. They were very sensitive to US policy, even “paranoid” about “the slightest change in US attitudes toward the island.”452 The regime may have therefore acquiesced to US demands in order to maintain the bilateral relationship.

Hence the security factors favoring restraint involved Taiwan’s increasing political and economic dependence on the United States at a time of major international changes.

The United States, however, did not threaten sanctions on the overall bilateral relationship. Since US threats focused on suspending nuclear supplies, it can be surmised that the immediate concern for the ROC regime related to the potential impact of US sanctions on the nuclear power program. This concerned factors affecting the domestic economy and regime legitimacy as discussed below.

Domestic Politics/ Economic Model

By the early 1970s the KMT regime had come to rely on economic growth as an important tool for its domestic legitimacy.453 Taiwan was emerging as an economic ‘miracle’ of

backing is readily apparent here, but it is doubtful that the GRC [Government of the Republic of China] overlooks the major economic importance of the U.S. as Taiwan’s largest trading partner and source of investment capital. In dealing with these considerations, the GRC is aware that shifts in U.S. official and public thinking over the years have seriously eroded the political support it once enjoyed on the American scene and have created impatience with efforts to deal with international problems in cold war terms. Intense and frequent criticism of U.S. policy falls on unreceptive ears in the U.S. and is likely to risk undermining existing support by antagonizing influential American opinion. It could discourage American investment and trade by presenting the image of serious difficulties between the two countries.” Airgram from Ambassador McConaughy, American Embassy, Taipei to State Department, Washington, D.C., “US Policy – Annual Assessment”, June 7, 1971, A-139, emphasis added; NACP.

452 Michael D. Swaine and James C. Mulvenon, Taiwan’s Foreign and Defense Policies: Features and Determinants (RAND, 2001), 129. A telegram from the American embassy in Taipei observed that Taiwan’s “crucial dependence results in uneasy and close ROC scrutiny of all US pronouncements and actions.” Telegram from American embassy, Taipei to Secretary of State, Washington, D.C., May 25, 1973, Taipei 3088; NACP. ROC officials were strongly inclined to exaggerate the importance of relatively insignificant changes such as staff appointments at the embassy as indicating major shifts in US policy. EA Arthur W. Hummel Jr, Information Memorandum to Acting Secretary Kenneth Rush, July 3, 1971; NACP.

453 In the early years after establishing itself on Taiwan, the regime used brutal repression to rule. The population viewed the KMT as no different from the previous Japanese colonizers (who ruled from 1895 to 1945). John Franklin Copper, Taiwan: Nation-State or Province? (Westivew Press, 1996); Roy, Taiwan. Solingen states the following on the importance of economic growth for the regime’s legitimacy: “The KMT thus sought to secure its 223

rapid economic growth fueled by an export-oriented policy.454 In 1969 Taiwan became a net exporter to the United States for the first time.455 The United States was central to this economic growth as Taiwan’s largest trade partner. In a letter to President Nixon in 1973, ROC Premier

Chiang Ching-kuo admitted this, stating, “Recognizing that the economic ties between the two countries must be to our mutual advantage, we are endeavoring to maintain and promote the two-way commerce on the basis of equitable balance in order to profit both sides.”456

Taiwan’s rapid economic growth expanded the need for energy sources, with nuclear energy becoming an attractive alternative to the traditional dependence on foreign oil. Since

Taiwan imported some 80 percent of its energy needs, its emerging plans for nuclear power was a critical basis to sustain high growth levels. Energy became an especially important concern

tenuous hold in power to enhance its appeal across the Straits by nurturing a thriving economic system, one that was presumably superior to the mainland’s “in improving the people’s livelihood.” This strategy was at the core of the KMT’s effort to stem domestic threats to its own survival, particularly from communist subversion and repressed native Taiwanese who supplied the regime with soldiers, taxes, and lower-level bureaucrats.” Solingen, Nuclear Logics, 109.

454 Taiwan’s economic miracle as one of four East-Asian “tigers” had occurred as a result of a state-driven export- oriented policy with the United States as its primary partner. After following a policy of agricultural expansion and import-substitution in the 1950s, its growth spurt emerged from the rapid increase in labor-intensive exports in the 1960s. Simon Long, Taiwan: China’s Last Frontier (New York: St. Martin’s Press, 1991); and Lasater, US Interests in the New Taiwan. Although market-driven, the state was dominant and undertook important measures such as a unified exchange rate, devaluation of the currency, and a customs rebate scheme. Robert E. Baldwin, Tain-Jy Chen, and Douglas Nelson, Political Economy of US-Taiwan Trade (Ann Arbor: University of Michigan Press, 1995), 2-5.

455 Wu sums up the pattern of economic growth in the 1960s thus: “The more Taiwan exported, the more foreign exchange it earned; the more foreign exchange it earned, the more equipment and raw materials it imported. In turn, more and larger processing plants were established, and more goods were exported. This cycle led to full employment and an increase of per capita GNP, savings, and capital supply, thereby reinforcing the cycle.” Wu, A Political Explanation of Economic Growth, 189.

456 The letter also stated, “We are gratified… that the United States has continued to lend its support to us in all fields during our adversities. Coupled with our own internal solidarity, stability and hard work, the uninterrupted flow of American investments to this country and the ever-increasing trade between us have also benefited the continuation of our steady economic growth.” Letter from Chiang Ching-kuo, ROC Premier, to President Nixon, September 3, 1973, NACP.

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with the oil crisis.457 Taiwan’s nuclear power program depended almost entirely on US supplies.

Restraint 1 involved the direct threat of US sanctions on equipment for four planned nuclear power plants, which appears to have been critical in influencing ROC decisions in 1973.

Therefore Restraint 1 was at least partly driven by the desire to ensure continued cooperation for the power program.458 In fact Foreign Minister Shen “noted that ROC would have to count on continued US support and cooperation in assuring sufficient supply of necessary materials for ROC civilian nuclear power programs”.459 He also referred to US nuclear cooperation as necessary for the ROC’s continued ‘success’.460 Hence economic concerns about sustaining Taiwan’s miracle growth rates -- a key requirement for maintaining regime legitimacy – helped persuade the regime to undertake restraint in 1973.

Conclusion: Motivational Factors in Restraint 1

Sanctions induced Restraint 1 through motivational factors, which hinged on Taiwan’s dependence on the United States for its nuclear energy program and overall economic growth.

Both the security and domestic political motives for restraint hinged primarily on economic considerations in this period. This is best summed up in a 1974 State Department memo: “To date these efforts [to acquire a military nuclear capability] have been effectively inhibited by our firm and explicit opposition and by an unwillingness to jeopardize Taiwan’s rapidly growing civilian nuclear power program which is hostaged to the US because no other country can

457 Yager, “Taiwan”, 67; Overholt, “Nuclear Proliferation in Eastern Asia”; Testimony by Arthur Hummel, Jr., to the Subcommittee on Arms Control, International Organizations and Security Agreements, Senate Committee on Foreign Relations, September 22, 1976. Taiwan began ordering nuclear power plants from the United States in 1970, even before the oil crisis. Surrey, “Nuclear Power”, 469.

458 Solingen, Nuclear Logics, 112-113.

459 Cable from American Embassy, Taipei to State Department, Washington, D.C., “ROC Decides Against Purchase of Nuclear Reprocessing Plant”, February 8, 1973, Secret, Cable 828, NSA.

460 Cable from American Embassy, Taipei to State Department, November 23, 1973, Secret, Cable 7051.

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legally supply reactors to the ROC.”461 These security and domestic considerations462 were important in ushering in nuclear restraint because it was nearly impossible for Taiwan to pursue a weapons effort without US detection.463

Table 5.4 Summary of Taiwan’s restraint 1 (slow) 1973

Causes of restraint Present? Resource Constraints: Techological No Did sanctions impose significant resource constraints on NW Financial No program? Motivational Changes: Security Yes Did sanctions induce motivational changes in NW program? Domestic Politics Yes

Prestige No

Restraint 2 – (Stop and Rollback) 1977-1978

Although Taiwan abandoned its deals with the German and French firms in 1973, the

United States became aware of continued interest in military R&D in the nuclear program at

461 Philip C. Habib, Chairman, Interdepartmental Group for East Asia & the Pacific, State Department, Memorandum to Lt. General Brent Scowcroft, November 12, 1974, Top Secret, NSA.

462 The prestige model of nuclear restraint is typically based on the calculus of improved international status from giving up a nuclear weapons effort, thus submitting to the international nonproliferation norm. Since Taiwan’s restraint in 1973 was not publicized, it would seem that the leadership was not significantly motivated by prestige considerations. If prestige did play a role here, it was probably in terms of weighing Taiwan’s declining international security as signified by its declining international prestige, with fewer and fewer countries maintaining diplomatic relations with it.

463 As a State Department memo noted, Taiwan had only one reactor in operation; if it “wanted to obtain plutonium from the reactor as quickly as possible, it would run it constantly at full capacity and would frequently remove used fuel cores for reprocessing. At this maximum pace, the reactor would take a year to produce enough plutonium to construct one test weapon – assuming that the ROC had reprocessing facilities available and the necessary knowledge. It is unlikely that the ROC could maintain secrecy about a weapons program if it operated on this schedule.” Moreover, given that the TRR was for research purposes, Taiwan would probably have to “wait a long time before it had enough plutonium for a weapon.” State Department Memo, “Reported ROC Nuclear Weapons Development Program”, April 7, 1973, Secret; NSA.

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least by November 1974.464 Early in 1976 it learned that Taiwan may be attempting to reprocess plutonium from TRR spent fuel. As a result of direct US requests, Taiwan stopped all fuel cycle activities and temporarily shut down the TRR in 1977. Besides jettisoning plans for reprocessing plutonium, it went further in dismantling existing reprocessing facilities and returning all spent fuel to the United States. By doing so, the ROC rolled back the most significant aspects of its weapons program. Thus Restraint 2 was characterized by the stopping and rolling back of Taiwan’s nascent weapons effort. The table below lists the components of

Restraint 2, and is followed by an elaboration of these developments.

Table 5.5 Elements of restraint 2 (1977-78)

* ROC abandons plans for large reprocessing plant * Suspends operations at TRR * Dismantles reprocessing facilities * Agrees to transfer spent fuel outside the country * Returns plutonium to United States * Agrees to give US access to all nuclear facilities

Early in 1976 IAEA inspections concluded that Taiwan’s nuclear activities needed to be observed more closely – due to inadequate surveillance equipment the Agency could not ascertain whether spent fuel rods from the TRR had been diverted for reprocessing.465 In addition inspectors discovered that the Plutonium Fuel Chemistry Laboratory could produce

464 A State Department memo stated, “… the ROC has not abandoned its covert military nuclear energy research program and it probably possesses most of the technological know-how for the development of a nuclear device.” Philip C. Habib, Chairman, Interdepartmental Group for East Asia & the Pacific, State Department, Memorandum to Lt. General Brent Scowcroft, November 12, 1974, Top Secret, NSA. In 1974 the CIA also noted that the ROC nuclear program “clearly” entailed a “weapons option” – quoted in Albright and Gay, “Taiwan”, 57. However, the United States probably did not act on this since it seemed to view a nuclear weapons research program as acceptable, but drew the line with regards to reprocessing fissile material.

465 Ten fuel rods containing about 500 grams of plutonium could not be located. The IAEA could not determine if these had been sent to the fuel fabrication plant, or whether they were diverted to reprocess plutonium. Albright and Gay, “Taiwan”, 58; Richelson, Spying on the Bomb, 274.

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plutonium metal466 using US-supplied plutonium.467 After a visit by Inspector General Rudolf

Rometsch in May-July 1976, inspectors found some discrepancies in the quantities of spent fuel declared by ROC officials.468 However inspectors believed that a reprocessing facility they inspected had likely not handled any spent fuel, and that the facility was in any case too small to reprocess kilogram quantities of plutonium.469

The United States, nevertheless, remained concerned about Taiwan’s intentions. In late

1975 Taiwan had conveyed its intention to reprocess plutonium from the spent fuel of the US- supplied reactor at Tsinghua University.470 Reports from embassies in Belgium, Austria, and the

Netherlands suggested that Taiwan was continuing to seek a larger plutonium reprocessing plant. Specifically. ROC negotiations with a Dutch firm, Comprimo, would continue to concern the United States for the next several months. American Ambassador Leonard Unger471 met

Premier Chiang Ching-kuo in May 1976 to express these concerns. Chiang assured him that the nuclear program was for peaceful purposes.472

Around the same time (in July-August 1976) the United States pressed the Dutch and

Belgian governments to refrain from providing reprocessing equipment to Taiwan. As a result

466 This was significant because “plutonium in metallic form is rarely if ever used in civilian programs.” Albright and Gay, “Taiwan”, 57.

467 Richelson, Spying on the Bomb, 274.

468 However the IAEA did not determine there to be any significant violations of safeguards. Albright and Gay, “Taiwan”, 58; Cable from American Embassy, Taipei to State Department, Washington, D.C., “Ambassador meets with Foreign Minister Shen to Discuss Recent Reports Concerning Reprocessing on Taiwan”, August 31, 1976, Confidential, Cable 5965; NSA.

469 It is speculated the inspectors visited the “hot lab” reprocessing facility. Richelson, Spying on the Bomb, 274-275.

470 Schumacher, “Taiwan”.

471 Unger replaced McConaughy has US Ambassador to the ROC in 1974.

472 Cable from State Department, Washington, D.C. to American Embassy, Taipei, “ROC’s Nuclear Intentions”, September 4, 1976, Secret Exdis, Cable 219733; NSA.

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the Dutch Ministry of Foreign Affairs pressured Comprimo to avoid supplying anything related to reprocessing technology including technical know-how.473 Although Taiwan continued its links with Comprimo for a few more months,474 by January 1977 the State Department was somewhat assured that the deal had been suspended, apparently under pressure from the Dutch government.475 The Belgian firm Belgo Nucleaire also denied Taiwan’s request for reprocessing technology partly in response to American pressure, but also because Belgium was reassessing its nuclear export policy.476

The United States formally presented its concerns to Taiwan in its first demarche since

1973477 by Ambassador Leonard Unger in September 1976.478 Unger conveyed to ROC Foreign

Minister James Shen that the United States was aware of INER efforts to obtain reprocessing

473 According to a Comprimo businessman, Taiwan had expressed interest in the entire nuclear fuel cycle. Cable from American Embassy, the Hague to State Department, Washington, D.C., “Nuclear Fuel Reprocessing Plant”, July 7, 1976, Secret Limdis, Cable 8502; NSA.

474 According to State Department official Robinson, there was “conclusive evidence” that in early September 1976 Taiwan was still seeking reprocessing technology from Comprimo. Cable from State Department, Washington, D.C. to American Embassy, Taipei, “ROC’s Nuclear Intentions”, September 4, 1976, Secret Exdis, Cable 219733; NSA.

475 Cable from State Department to American Embassy, Taipei, “Taiwan’s Continuing Interest in Reprocessing”, January 8, 1977, Secret Exdis, Cable 4532; NSA.

476 Belgium was believed to be reviewing its export policy on nuclear technology, and was accordingly delaying the export of sensitive nuclear technology to South Korea and India. Cable from American Embassy, Brussels to State Department, Washington D.C., “Nuclear Reprocessing in ROC”, August 20, 1976, Secret, Cable 8149; NSA.

477 Based on publicly available information, this was the first US demarche since 1973.

478 Unger had already conveyed US disapproval of ROC interest in reprocessing to Foreign Minister Shen and Vice Foreign Minister Fred Chien a few days ago. Cable from American Embassy, Taipei to State Department, Washington, D.C., “Ambassador meets with Foreign Minister Shen to Discuss Recent Reports Concerning Reprocessing on Taiwan”, August 31, 1976, Confidential, Cable 5965; NSA; Cable from American Embassy, Taipei to State Department, Washington, D.C., “Nuclear Fuel Reprocessing Plants”, 16 August 1976, Secret Exdis, Cable 5536; NSA. Foreign Minister Shen had conveyed four points from Premier Chiang Ching-kuo – (i) the ROC reiterates that it does not intend to make nuclear weapons, (ii) nuclear facilities are under IAEA safeguards, (iii) the ROC has and continues to adhere to the terms of the NPT, and (iv) R&D in the nuclear field is only for peaceful purposes, which is essential for ROC economic development, and the nuclear program depends on fuel supply from the United States. Cable from American Embassy, Taipei to State Department, Washington, D.C., “Ambassador meets with Foreign Minister Shen to Discuss Recent Press Reports Concerning Reprocessing on Taiwan”, August 31, 1976, Confidential, Cable 5965; NSA.

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technology from Europe and that persisting in such efforts would “fundamentally jeopardize the prospects for continued cooperation between our two governments in the nuclear field”.479 Apart from threatening such sanctions on nuclear cooperation, Unger also stated that under the

Symington Amendment the United States was required to deny military and economic assistance to any country that acquired reprocessing capability.480 Foreign Minister Shen responded that the ROC had no intention of acquiring nuclear weapons or such a capability.481

In an official note a few days later, the ROC stated that it would no longer conduct any reprocessing activities.482

The same month Unger also met with Premier Chiang Ching-kuo (CCK), who stated that it was the policy of the ROC “not to manufacture nuclear weapons.”483 Chiang said that Taiwan would stop enquiries for a reprocessing facility in order to avoid misunderstanding with the

United States, with whom it wanted to maintain good relations.484 Two days later the Premier

479 Cable from State Department, Washington, D.C. to American Embassy, Taipei, “ROC’s Nuclear Intentions”, September 4, 1976, Secret Exdis, Cable 219733; NSA.

480 Cable from State Department, Washington, D.C. to American Embassy, Taipei, “ROC’s Nuclear Intentions”, September 4, 1976, Secret Exdis, Cable 219733; NSA.

481 Cable from American Embassy, Taipei to State Department, Washington, D.C., “Demarche on ROC’s Nuclear Intentions”, September 9, 1976, Secret Exdis, Cable 6100; NSA.

482 Burr, ed., US Opposed Taiwanese Bomb.

483 Cable from American Embassy, Taipei to State Department, Washington, D.C., “ROC’s Nuclear Intentions: Conversation with Premier Chiang Ching-kuo”, September 15, 1976, Cable 6272; NSA.

484 At the meeting, Chiang Ching-kuo seemed to obfuscate the issue of a reprocessing lab versus an industrial-scale plant. Unger clarified that the United States was concerned about the latter. Chiang said, “all reprocessing research, peaceful or otherwise, will be terminated.” He even stated that when mainland China is recovered in the future, all its nuclear facilities will be diverted for peaceful uses as well. Cable from American Embassy, Taipei to State Department, Washington, D.C., “ROC’s Nuclear Intentions: Conversation with Premier Chiang Ching-kuo”, September 15, 1976, Cable 6272; NSA.

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publicly declared at a cabinet meeting that the ROC has and never had any intention to develop nuclear weapons or to obtain reprocessing technology.485

American concerns, however, deepened with PRC accusation that the United States was helping Taiwan develop nuclear weapons.486 Just a few weeks after CCK’s assurances, the

United States obtained evidence indicating that Taiwan was still seeking reprocessing technology.487 By December the embassy noted that it had “compelling evidence” of continuing

ROC links with Comprimo.488 Further, in January 1977 CCK stated that Taiwan would never produce nuclear weapons “although the Nationalist Chinese government has the capability of developing nuclear arms”.489

Under instructions from Secretary of State Henry Kissinger, Deputy Chief of Mission

William Gleysteen made a second US demarche, conveyed to Vice Foreign Minister Frederick

Chien in January 1977. Gleysteen demanded that Taiwan must “terminate this relationship with

Comprimo” and alluded to possible sanctions on nuclear cooperation.490 An American technical team visited Taiwan in January 1977, conveying the recent emphasis on nonproliferation in US

485 Cable from US Embassy, Taipei to State Department, Washington D.C., “ROC’s Nuclear Intentions”, September 17, 1976, Unclassified, Cable 6301; NSA.

486 Hersman and Peters, “Nuclear U-Turns”, 544.

487 State Department, Memorandum of Conversation, “ROC Nuclear Intentions”, November 18, 1976, Top Secret Nodis; NSA.

488 Cable from American Embassy, Taipei to State Department, Washington, D.C., “US Nuclear Team Visit”, December 1976, 30, Secret Exdis, Cable 8564, ; NSA.

489 Melinda Liu, “Taiwan Develops Nuclear Industry, Weapons Capacity”, Washington Post, February 27, 1977.

490 Cable from Secretary of State, Washington DC to American Embassy, Taipei, January 8, 1977, “Taiwan’s Continuing Interest in Reprocessing”, Secret Exdis, Cable 4532; NSA. Chien seemed “bewildered” about the accusations, claiming never to have heard of Comprimo. It seemed that “Chien was obviously shaken” by the allegations and “did not appear to be feigning lack of knowledge”, suggesting that he was unaware of INER’s overtures to European nuclear firms. Cable from American Embassy, Taipei to State Department, Washington D.C., “Taiwan’s Continued Interest in Reprocessing”, January 12, 1977, Secret, Cable 209.

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foreign policy.491 The team told ROC officials that all reprocessing efforts must stop, whether laboratory scale or industrial scale.492 In reply to a query on the “penalties” for noncompliance,

Burton Levin (Director of the ROC desk at the State Department), the head of the study team, replied, “sanctions would not be confined to nuclear matters but would also affect a wide range of relations, including military cooperation.”493

In March 1977 the United States learned about possible diversion of spent fuel from the

TRR. IAEA inspectors discovered a gate in the spent fuel pond of the TRR, near the hot laboratory. The gate had been omitted in the design information supplied to the Agency.494 The

Carter administration decided to formally protest this with the highest levels of ROC leadership, including written communication to eliminate ambiguity on the US position. Thus the third and strongest yet US demarche was presented in March 1977, conveyed by Ambassador Unger to

Premier Chiang. The United States demanded a “drastic reorientation” of Taiwan’s nuclear activities as conducted by INER.495 These demands included: place all nuclear materials and facilities under the ROC-US nuclear safeguards agreement, end all fuel cycle activities and

491 Under the new Carter administration, which took office in January 1977, the United States placed greater emphasis on nuclear nonproliferation. Cable from State Department, Washington, D.C. to White House, Washington, D.C., March 5, 1977, Nodis – for Brzesinski only, “Nuclear Proliferation”, Cable 49428, NSA. The US team called on senior ROC officials including Vice Foreign Minister Chien, Deputy Defense Minister Admiral Feng Chi-Tsung, and Chairman of the AEC Chien Szu-Liang. Cable from American Embassy, Taipei to State Department, Washington D.C., "US Nuclear Team Visit to ROC - Calls," January 19, 1977, Confidential, Cable 332; NSA.

492 Cable from American Embassy, Taipei to State Department, Washington D.C., "US Nuclear Team Visit to ROC - Calls," January 19, 1977, Confidential, Cable 332; NSA. Until now the emphasis had been on ROC interest in industrial scale reprocessing technology.

493 Cable from American Embassy, Taipei to State Department, Washington D.C., "US Nuclear Team Visit to ROC - Calls," January 19, 1977, Confidential, Cable 332; NSA.

494 Albright and Gay, “Taiwan”, 58; Cable from American Embassy, Tokyo to State Department, Washington, D.C., “ROC/IAEA Safeguards”, March 8, 1977, Secret Nodis, Cable 3212; NSA.

495 Cable from State Department, Washington, D.C. to American Embassy, Taipei, June 17, 1977, “Follow-up to US Technical Team Visit”, Secret, Cable 140904; NSA.

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“reorient facilities involving or leading to weapons-usable materials”, transfer plutonium to the

United States, and suspend operations of the TRR until a mutually acceptable arrangement to dispose off its spent fuel is worked out.496 The United States made the far-reaching request that

Taiwan “avoid any program or activity which, upon consultation with the US, is determined to have application to the development of a nuclear explosive capability.”497

The ROC agreed to these terms, which were codified in a written note submitted by

Taiwan on 12 April 1977. Known simply as the “note”, its details are not publicly available.498

In just a month the demands were met to the satisfaction of Washington, as suggested by a memorandum to President Carter from National Security Adviser Brzezinski.499 The ROC undertook the significant measures of shutting down the TRR, closing the hot lab, and apparently terminating the deal with Comprimo.500 In 1978 it returned 863 grams of US-

496 Cable from Secretary of State, Washington, D.C. to American Embassy, Taipei, “Nuclear Representation to the ROC”, March 26, 1977, Secret Nodis, Cable 67316; NSA. These are listed in the talking points prepared for Ambassador Unger by the State Department. Although the details of Unger’s meeting with Chiang are not available, it is safe to assume that the ambassador did carry out the orders from Washington, as indicated by his response to the instructions – “Will be seeking appointment to carry out instructions reftel [reference telegram] at premier’s earliest convenience.” Cable from American Embassy, Taipei, to State Department, Washington, D.C., “Nuclear Presentation to the ROC”, March 26, 1977, Cable 1682, Secret Nodis, NSA.

497 Cable from Secretary of State, Washington, D.C. to American Embassy, Taipei, “Nuclear Representation to the ROC”, March 26, 1977, Secret Nodis, Cable 67316; NSA.

498 Burr, ed., US Opposed Taiwanese Bomb During 1970s; Cable from American Embassy, Taipei to State Department, Washington, D.C., “US Technical Team Visit”, May 31, 1977, Secret Limdis, Cable 3158; NSA.

499 Brzezinski writes: “It is now quite clear that the Taiwanese Institute of Nuclear Energy Research has been ordered to terminate its heavy water reactor project and close the hot laboratory. The American effort to crack down on this project clearly yielded its desired results.” Zbigniew Brzezinski, Weekly National Security Report #11, Memorandum from Zbigniew Brzezinski to President Carter, April 29, 1977; NSA. Similarly Ambassador Unger wrote to the State Department, “We were favorably impressed… by the progress they [US technical team members] appear to have made in re-directing ROC nuclear research activities into areas of minimal proliferation risk.” Cable from American Embassy, Taipei to State Department, Washington, D.C., “US Technical Team Visit”, June 6, 1977, Secret, Cable 3310; NSA.

500 Cable from U.S. Embassy, Taipei to State Department, "Visit of CAEC Secretary General - Dr. Victor Cheng," May 6, 1977, Secret (repeated to Brzezinski at White House), Secret Nodis, excised copy, Cable 2646; NSA. Los Alamos scientists verified the irradiation history of the TRR after it was shut down. Albright and Gay, “Taiwan”, 59; Richelson, Spying on the Bomb, 277.

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supplied plutonium .501 Taiwan was also “agreeable” to transfer its spent fuel outside the country.502 A US technical team visiting Taiwan in May 1977 found ROC officials very cooperative in establishing that they had met all US requests.503

Despite such compliance, Ambassador Unger believed that the United States must avoid

“complacency”.504 In December 1977 American officials specified that the TRR could resume operation when the following conditions were met – application of appropriate safeguards (fuel would be loaded and unloaded only in the presence of IAEA inspectors); spent fuel disposal by transferring it outside Taiwan; and an acceptable research program. The United States made the additional demands that Taiwan should cooperate to convert the TRR to run on LEU fuel, and that it should have “unlimited access to all ROC nuclear facilities upon request”.505 It threatened nuclear sanctions, as well as suspension of the overall bilateral relationship, if Taiwan did it not

501 Albright and Gay, “Taiwan”, 59.

502 The IAEA had sealed 118 spent fuel rods containing 5 kg of plutonium. Cable from American Embassy, Taipei to State Department, “US Technical Team Visit”, May 31, 1977, Secret Limdis, Cable 3158; NSA. Initially, it was thought that the fuel would be sent to Canada. However, negotiations were delayed due to issues relating to safety, shipping routes, and legal issues since the spent fuel was not of US origin. The transfer of the spent fuel to the United States was finalized in 1985. Albright and Gay, “Taiwan”, 59.

503 The embassy noted that “ROC officials were most cooperative and seemed extremely desirous of taking all necessary steps to assure complete compliance with the agreements in the notes [a reference to the classified US- ROC understanding].” Cable from American Embassy, Taipei to State Department, Washington, D.C., “US Technical Team Visit”, May 31, 1977, Secret Limdis, Cable 3158; NSA; Cable from American Embassy, Taipei to State Department, Washington, D.C., “US Technical Team Visit”, June 6, 1977, Secret Limdis, Cable 3310; NSA.

504 Unger advanced two concerns. First, the US team visit of May 1977 showed that the plutonium process line was still open. (Taiwan dismantled all its reprocessing facilities; however the hot laboratory was converted to study spent fuel without separating plutonium or enriched uranium. Secondly, Unger believed that the ROC may renew weaponization efforts in the future due to declining US security commitments. Hence he advocated continuing visits by American officials. Albright and Gay, “Taiwan”, 59; Cable from American Embassy, Taipei to State Department, Washington, D.C., “US Technical Team Visit”, June 6, 1977, Secret Limdis, Cable 3310; NSA.

505 The United States conceded that the TRR could temporarily be used as a heavy water reactor until low-enriched uranium fuel was developed and the TRR was converted into a light water reactor. It was expected that a joint US- Canadian effort (to convert a heavy water reactor into one capable of running on LEU) would be completed in a few months. Eventually the United States intended to supply Taiwan with the LEU needed to run the reactor. Cable from Secretary of State Vance, Washington, D.C. to American Embassy, Taipei, “The Taiwan Research Reactor”, December 22, 1977, Secret Nodis, Cable 305275; NSA.

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limit its nuclear program to peaceful purposes.506 It appears that ROC officials responded well and the TRR was allowed to resume operation in 1978, while arrangements for transferring the spent fuel were being worked out.507 Thus the weapons effort based on plutonium reprocessing stopped and rolled back in 1977-1978 under US pressure.

Suspicions of nuclear weapons related activity re-emerged, however, in 1978. This time the United States suspected that Taiwan might be running a secret uranium enrichment program at the Chungshan Institute (CIST).508 Following a visit by another technical team in July-August

1978,509 Ambassador Unger presented to President Chiang510 a letter from Secretary of State

Cyrus Vance. Highlighting US concerns about suspected activities at CIST,511 this was the final

506 Cable from Secretary of State Vance, Washington, D.C. to American Embassy, Taipei, “The Taiwan Research Reactor”, December 22, 1977, Secret Nodis, Cable 305275; NSA.

507 Burr, ed., US Opposed Taiwanese Bomb During 1970s.

508 Cable from American Embassy, Taipei to State Department, Washington, D.C., “Nuclear Team Visit: Initial Calls: Discussions with CIST Director Tang”, July 31, 1978, Secret Exdis, excised copy, Cable 4988; NSA. Bullard and Yuan, “Taiwan and Nuclear Weaponization”, 184. According to someone identified only as “Allen” (presumably a US government official), Taiwan may have been conducting experiments in laser isotopic separation. Memorandum from Gerard Smith to Allen, 10 March (1978?); NSA.

509 Further information on the circumstances surrounding the visit is not publicly available. CIST Director Tang initially refused to meet with the team and appears to have denied it access to its facility. However the team was allowed to visit any facility it chose after Unger pointed out that the Carter administration had recently passed the Nuclear Non-Proliferation Act, which prevented US nuclear exports to any country that had violated IAEA safeguards or the terms of an agreement with the United States. Burr, ed., US Opposed Taiwanese Bomb; Cable from American Embassy, Taipei to State Department, Washington, D.C., “Nuclear Team Visit: Initial Calls: Discussions with CIST Director Tang”, July 31, 1978, Secret Exdis, excised copy, Cable 4988.

510 Chiang Ching-kuo became President in 1978. However, due to his father’s declining health, he had been in charge since 1972 when he became Premier. Chiang Kai-shek died in 1975.

511 Burr, ed., US Opposed Taiwanese Bomb. The letter, as well as some talking points, were delivered by Ambassador Unger to President Chiang in September 1978. Cable from Ambassador Unger, American Embassy, Taipei to Secretary of State, Washington, D.C., “Follow-up to Nuclear Team Visit: Demarche to President Chiang”, September 8, 1978, Secret Nodis, Cable 6065; NSA.

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demarche in Restraint 2. Unger stressed that the termination of US nuclear exports would be disastrous for Taiwan’s economy.512

Chiang Ching-kuo was clearly perturbed by Washington’s repeated questions and demands, responding that the ROC would not manufacture nuclear weapons.513 In his written reply to Secretary Vance, he stated that all research work related to nuclear enrichment, reprocessing, and heavy water production had ceased following ROC commitments to the

United States (presumably in April 1977). CCK reassured Unger that Taiwan was not and would not conduct military-related nuclear research.514 Washington saw these declarations as restoring confidence in Taiwan’s activities.515 The table below sums up these developments in Restraint

512 Cable from American Embassy, Taipei to State Department, Washington, D.C., “Nuclear Team Visit: Initial Calls: Discussions with CIST Director Tang”, July 31, 1978, Secret Exdis, excised copy, Cable 4988; NSA.

513 Cable from Ambassador Unger, American Embassy, Taipei to Secretary of State, Washington, D.C., “Follow-up to Nuclear Team Visit: Demarche to President Chiang”, September 8, 1978, Secret Nodis, Cable 6065; NSA.

514 Cable from American Embassy, Taipei to State Department, Washington, D.C., “Nuclear Team Visit: Initial Calls: Discussions with CIST Director Tang”, July 31, 1978, Secret Exdis, excised copy, Cable 4988; NSA. In his written reply to Secretary of State Vance, President Chiang stated: ““In reply, I wish to assure you that my government is not engaged in any research work in the sensitive fields of nuclear enrichment, reprocessing or heavy- water production. The [excised] research work currently conducted at the CIST (Chung Shan Institute of Science Technology) has never aimed at [excised] While there was some research work on this subject at the INER (Institute of Nuclear Energy Research) in the past, this has long been stopped and will not be revived in the light of our commitment to the United States not to engage in any work that might lead to nuclear proliferation. I wish to avail myself of this opportunity to reaffirm the policy of my government to develop nuclear energy exclusively for peaceful purposes, and also to reassure your Excellency that the Government of the Republic of China has no intention whatsoever to develop nuclear weapons or a nuclear device or to engage in any activity related to reprocessing purposes”. Cable from American Embassy, Taipei to State Department, Washington, D.C., “President Chiang’s Reply to Secretary Vance’s Letter on Nuclear Matters”, September 14, 1978, Secret Nodis, Cable 6279; NSA.

515 Burr, ed., US Opposed Taiwanese Bomb.

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Table 5. 6 Restraint 2 (1977-78)

Date By and To Demands Sanctions ROC Response Made Threatened

Demarche 1 Sept. By: * Stop * Nuclear * Shen responds that govt. does 1976 Ambassador attempts to * Military & not intend to get large Unger acquire economic reprocessing plant To: Foreign reprocessing assistance * Written ROC response: will Minister Shen technology stop all reprocessing activities

Sept. Amb. Unger None CCK stated: ROC policy “not 1976 meets (meeting was to manufacture nuclear Premier CCK at CCK’s weapons”516 request) 2 Jan. By: DCM Terminate * Nuclear * Chien was “bewildered” by 1977 William relationship accusations517 Gleysteen with Dutch * Said that ROC had To: Vice firm unblemished record in dealings Foreign Comprimo with US Minister Chien

Jan. Visit by US No amount of * Nuclear – this Vice Foreign Minister Chien 1977 technical reprocessing was stressed and Economic Affairs Minister team, headed is allowed * Overall Sun seemed to believe that by Burton relations endangering nuclear power Levin (State including program would be “folly”518 Dept. ROC military Desk). Team meets several ROC officials March By: Amb. * Strongest * Nuclear * CCK apparently agreed521 1977 Unger demarche * “Other * Within a month, ROC did To: Premier * Demands: important the following:522 CCK - Put all relationships… - shut down TRR

516 Cable from American Embassy, Taipei to State Department, Washington, D.C., “ROC’s Nuclear Intentions: Conversation with Premier Chiang Ching-Kuo”, September 15, 1976, Cable 6272, Secret Nodis; NSA.

517 Cable from American Embassy, Taipei to State Department, Washington D.C., “Taiwan’s Continued Interest in Reprocessing”, January 12, 1977, Secret, Cable 209.

518 Cable from American Embassy, Taipei to State Department, Washington D.C., "US Nuclear Team Visit to ROC - Calls," January 19, 1977, Confidential, Cable 332; NSA.

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current and will also - closed hot lab future suffer”520 - ended Comprimo deal facilities & - agreed to transfer spent fuel materials under ROC- US agreement - Dispose of spent fuel in mutually acceptable way - End all fuel cycle activities - Avoid any program/activ ity which US determines to have weapons applicability - Transfer plutonium to US - Suspend TRR operations until acceptable conditions arranged519

Dec. By: Embassy - Convert * Nuclear ROC agrees524 1977 officials TRR to run * Overall To: Foreign on LEU fuel bilateral Ministry (at - Load and relations level of unload fuel in Minister or presence of

521 Burr, ed., US Opposed Taiwanese Bomb.

522 Cable from U.S. Embassy, Taipei to State Department, "Visit of CAEC Secretary General - Dr. Victor Cheng," May 6, 1977, Secret (repeated to Brzezinski at White House), Secret Nodis, excised copy, Cable 2646; NSA.

519 These included an acceptable research program, safeguards application, and appropriate disposal of spent fuel. Cable from State Department, Washington, D.C. to American Embassy, “Nuclear Representation to the ROC”, March 26, 1977, Secret Nodis, Cable 67316; NSA.

520 Cable from American Embassy, Taipei, to State Department, Washington, D.C., “Nuclear Presentation to the ROC”, March 26, 1977, Cable 1682, Secret Nodis, NSA.

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Vice inspectors Minister) 523 - Take spent fuel out - US access to all facilities

4 July- By: Amb. Apparently to * Nuclear 525 * President CCK is visibly Aug. Unger stop uranium upset at repeated US demands 1978 (delivers enrichment * States ROC not conducting letter from efforts military-related nuclear Vance) research To: President  US was satisfied CCK

Restraint 2: Motivational or Resource Driven?

Like Restraint 1, this phase was largely brought about by US pressure.526 Since Taiwan was overwhelmingly dependent on the United States for its nuclear program and its political survival, Restraint 2 could have been caused by both resource-related and motivational considerations. Resource constraints arose from US pressure on the Belgian and Dutch governments, as a result of which private firms in these countries cancelled plans for the supply

524 Burr, ed., US Opposed Taiwanese Bomb.

523 Cable from Secretary of State Vance, Washington, D.C. to American Embassy, Taipei, “The Taiwan Research Reactor”, December 22, 1977, Secret Nodis, Cable 305275; NSA.

525 Cable from American Embassy, Taipei to State Department, Washington, D.C., “Nuclear Team Visit: Initial Calls: Discussions with CIST Director Tang”, July 31, 1978, Secret Exdis, excised copy, Cable 4988; NSA.

526 Mitchell, “Taiwan’s Hsin Chu Program”, 301. 239

of reprocessing technology. This meant that Taiwan was simply unable to obtain the necessary technology for its nuclear weapons program.527

To assess the relative importance of resource constraints in Restraint 2, I consider two counterfactuals. In the first counterfactual scenario Taiwan is able to obtain reprocessing technology from other suppliers. In such a situation it is highly likely that the United States would, sooner or later, come to learn of Taiwan’s evolving nuclear weapons effort. Taiwan’s close relationship with the United States and the US military and diplomatic presence would make it very difficult for the regime to acquire fuel cycle capability in secret (especially after the United States was alerted to this in the early 1970s).528 The United States would then clearly and directly communicate its disapproval, and the regime would very likely undertake restraint in the face of such US opposition. Thus in the absence of resource constraints, motivational considerations alone would have led to Restraint 2. In other words Restraint 2 is likely to have occurred even without resource denial.

In the second counterfactual Taiwan faces significant resource constraints due to US pressure on potential suppliers; however the United States does not directly demand that Taiwan give up its nuclear weapons efforts. In such a situation it is likely that the ROC persists in attempts to obtain reprocessing technology by approaching different sources, or repeating current efforts more secretively. Such efforts would be made difficult by Taiwan’s eroding international status. Nevertheless its robust economy and links with global trade would mean that it could wield economic power to attract nuclear suppliers. Since Taiwan was an important

527 Hersman and Peters, “Nuclear U-Turns”, 547.

528 Yager, “Taiwan”, 80; Clough, Island China, 119; Memorandum for Mr. Richard Sneider from Mary E. McDonnell, State Department, Office of Republic of China Affairs, “Reported ROC Nuclear Weapons Development Program”, April 7, 1973; NSA.

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actor in the global economy, holding one of the highest foreign exchange reserves in the world,529 it was capable of undertaking some complex maneuvers to obtain nuclear technology.

However these attempts are likely to have been limited due to (a) US pressure on Belgium and

Netherlands (as well as Germany during Restraint 1), and (b) the difficulty of keeping such attempts secret from the United States. Ultimately in this counterfactual, Taiwan would probably succeed in obtaining only some aspects of fuel cycle capability. This implies that

Restraint 2 would have been more limited if the United States did not directly pressure Taiwan on its weapons effort.

Taken together, the two counterfactuals suggest that motivational factors were relatively more influential than resource denial in Restraint 2. As in Restraint 1, the motivations likely stemmed from the security and domestic politics models. The threat of suspending US nuclear cooperation as well as military and economic aid challenged the core of the regime’s survival since it was based on its economic ‘miracle’. The following sections make this argument, showing that Restraint 2 was brought about by both resource denial and motivational changes, with the latter being relatively more significant. Sanctions played an important role in the motivational route. The section below lists the possible sanctions affecting Restraint 2.

Sanctions possibly affecting Restraint 2

Unlike during Restraint 1, this time the US pressure went beyond verbal threats to involve some delays in the supply of nuclear technology -- the United States delayed export licenses for HEU fuel for the research reactor at Tsinghua University, and delayed approval for

529 In 1992 Taiwan had the largest foreign exchange reserves in the world. Tucker, Taiwan, Hong Kong, 167.

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operating the reprocessing lab.530 In addition to these actual delays the United States threatened the suspension of nuclear exports, and the overall political and military relationship with

Taiwan. The table below lists these sanctions during 1976-1978.

Table 5. 7. US sanctions on Taiwan 1976-1978

Date Sanctions Type of Sanctions

1976 US delays export licenses for HEU fuel531 and two Imposed US nuclear additional nuclear power plants;532 denies permission to use sanctions previously supplied HEU fuel in hot cell reprocessing laboratory.

Demarche 1 Threatened US nuclear Sept. Threat of US sanctions on nuclear cooperation conveyed sanctions; suggested 1976 by Ambassador Unger to ROC Foreign Minister Shen. US economic & military demands ROC give up reprocessing plans, and threatens sanctions possible future suspension of economic and military aid.

Demarche 2 Threatened US Jan. 1977 Burton Levin (Director, ROC Desk, State Department), political/security tells ROC Vice Foreign Minister Frederick Chien that sanctions failure to comply with US stipulations would result in sanctions affecting a broad range of issues, including the bilateral security relationship.533

Demarche 3 Threatened US March Ambassador Unger tells Premier Chiang Ching-kuo that nuclear, political, and 1977 the ROC risks cessation of US nuclear cooperation and economic sanctions “other important relationships” unless it “significantly modified” its nuclear program.534

530 Butterfield, “Taiwan Denying Atomic Operation”. Under the bilateral cooperation agreement, Taiwan was required to seek US permission for using US-supplied material in reprocessing. Schumacher, “Taiwan”.

531 Butterfield, “Taiwan Denying Atomic Operation”.

532 In 1972 and 1974 the United States had approved the sale of four nuclear energy plants – Edward Schumacher, “Taiwan”. Export licenses for two other reactors were delayed in 1976, but eventually granted, with the reactors beginning operations in 1978 and 1979 respectively. Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed.,CD- ROM; Surrey, “Nuclear Power”, 466.

533 Cable from American Embassy, Taipei to State Department, Washington D.C., "US Nuclear Team Visit to ROC - Calls," January 19, 1977, Confidential, Cable 332; NSA.

534 Cable from Secretary of State to American Embassy, Taipei, March 26, 1977, Secret Nodis, Cable 67316, “Nuclear Representation to the ROC”; NSA. 242

July 1978 Ambassador Unger tells CIST Director Gen. Tang that Threatened US nuclear under the newly passed Nuclear Non-proliferation Act, the sanctions United States would terminate nuclear exports to any country that had violated the terms of a bilateral agreement.

As is evident from the table, the United States repeatedly threatened sanctions on supplies for

Taiwan’s nuclear energy program. These ‘nuclear sanctions’ as I term them were the most frequently threatened US sanctions.

Sanctions and Restraint 2

Resource denial by sanctions can take place only when sanctions are actually imposed and not merely threatened. The imposed sanctions on Taiwan were limited to delays in the supply of US nuclear material and equipment. Such delays are likely to have inflicted minimal resource constraints on the nuclear weapons effort since, although its nuclear energy program was based entirely on US supplies, by this time Taiwan already possessed sufficient technical capacity to pursue a nuclear weapons program without American support.1 The bulk of US pressure on Taiwan was conveyed in the form of threatened sanctions rather than imposed sanctions. Since resource denial can only be brought about by imposed sanctions, this suggests that sanctions-induced resource constraints were minimal in Restraint 2,2 and that the more

1 This is discussed in more detail in the following pages. Arthur Hummel testified as follows: “The Republic of China, in common with an increasing No. of other non-nuclear states, has the economic and scientific base from which to develop nuclear weapons or a nuclear explosive device, should they choose to do so, and if they were in a position to procure the necessary quantities of weapons grade fissionable materials.” Testimony to the Subcommittee on Arms Control, International Organizations and Security Agreements, Senate Committee on Foreign Relations, September 22, 1976. As this statement shows, the difficult part for the ROC nuclear weapons program was attaining fissile material. Earlier discussion in this chapter has shown that the ROC was not relying on the United States for such technology. Therefore, US sanctions on nuclear cooperation were unlikely to deny resources for the weapons program.

2 Resource denial in Restraint 2 was very effective when the United States pressured European suppliers; however such resource denial was not the result of sanctions. 243

significant impact of sanctions took place through the motivational route. The following discussion evaluates both kinds of impact on the ROC nuclear program.

Resource Constraints 1976-78

As just argued, sanctions did not inflict resource constraints on the nuclear weapons program. This section considers the extent of resource denial that would have arisen if sanctions had been imposed. This helps show the larger potential of sanctions to inflict damage, a consideration that may have affected regime motivations to meet US demands.

Technology Denial

The first and most repeated component of the threatened US sanctions on Taiwan was the threat of suspending nuclear cooperation. The precise threat involved measures such as denying nuclear fuel supply and additional reactors. The fact that Taiwan’s nuclear power program depended heavily on US support has been commonly recognized.1434 The United States was “the sole supplier of enriched uranium” and the only source of enrichment facilities for the energy program.1435 Since the light water reactors for the power plants were US-origin, Taiwan also depended on the United States for their maintenance and repairs. Indeed all orders for the nuclear power plants were on a “turnkey basis”, with Taipower, the state-owned electric utility, handling project management.1436

In addition to all major equipment and fuel for the planned nuclear power plants,

Taipower also depended on the United States to train nuclear engineers and reactor operators –

1434 Mitchell, “Taiwan’s Hsin Chu Program”, 299; Solingen, Nuclear Logics, 112.

1435 Clough, Island China, 119; Yager, “Taiwan”, 68; and Liu, “Taiwan’s Power Game”.

1436 Surrey, “Nuclear Power”, 469.

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in 1976 about 200 employees were receiving education or training in the United States.1437 As a report for the Defense Department noted, “secondary suppliers are unlikely to be able to provide a full menu of nuclear services and technology.”1438 Thus US suspension of nuclear assistance would seriously “jeopardize” Taiwan’s nuclear power program.1439

Taiwan’s nascent nuclear weapons effort, however, revolved around technology from non-US sources. The most promising sources of components for a reprocessing plant were

Dutch, Belgian, and German.1440 The TRR (the heavy water reactor whose spent fuel was to generate plutonium for the weapons program) required natural uranium fuel, which had been supplied by Canada. Taiwan imported uranium from South Africa, some of which was processed into fuel rods at its fuel fabrication plant. It also possessed some technical capability and enough industrial capacity to produce nuclear weapons. It had adequate numbers of scientists and personnel trained in nuclear-related matters.1441 Thus, strictly speaking, any imposed US nuclear sanctions would not have significantly denied technology for the weapons program.1442

Financial Constraints

1437 Melinda Liu, “Accounting for the N-Factor”, Far Eastern Economic Review, December 17, 1976, 33.

1438 Beverly Rowen, “Taiwan: Will Derecognition Increase Nuclear Temptations?”, Report prepared for Defense Nuclear Agency, April 17, 1979, National Security Archives, George Washington University (hard copy).

1439 Schumacher, “Taiwan”.

1440 Taiwan was also seeking to train personnel in reprocessing technology with US help. For example one scientist received such training in the United States in 1975-76. Schumacher, “Taiwan”.

1441 Yager, “Taiwan”, 69; Quester, “Taiwan and Nuclear Proliferation”, 12; Clough, Island China, 117; Tucker, Taiwan, Hong Kong, 146.

1442 Regarding hypothetical US nuclear sanctions, a CIA report observed, “Sanctions would not materially affect the nuclear weapons program, because the ROC already has enough fuel for the research reactor for many years.” Prospects for Arms Production and Development in the Republic of China, Interagency Intelligence Memorandum, May 1976, 8. accessed March 1, 2012, http://www.foia.cia.gov/docs/DOC_0001115733/DOC_0001115733.pdf .

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American delays in supplying components for the nuclear energy program likely placed some overall economic costs. According to Hufbauer et al, the delay in the supply of nuclear fuel cost Taiwan about $16 million (estimated as an annual cost) due to reduced output; and an additional $1 million from delays in license for the US-supplied research reactor at Tsinghua university.1443

Besides these actual delays in nuclear supplies, the United States threatened further sanctions on nuclear cooperation. In the 1970s plans for nuclear energy formed an important part of future economic growth due to rising energy consumption and the country’s reliance on imported oil.1444 Throughout the decade construction had begun on three nuclear power plants

(each involving two light water reactors).1445 The first unit became operational in 1978, around the time of Restraint 2.1446 The government planned to generate about 30% of electricity needs from these nuclear plants.1447 The nuclear energy program depended entirely on the United

States, both for finances and for equipment and materials. All the planned nuclear power plants

1443 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM.

1444 Yager, “Taiwan”, 81; Solingen, Nuclear Logics, 112; Arthur Hummel, Jr., testimony. In 1978 Taiwan imported 81 percent of its energy supply. Yager, “Taiwan”, 66. According to a CIA report, “Because of its amazing growth record, Taiwan is under extra pressure to survey and develop other possible energy sources – including additional oil.” National Foreign Assessment Center, Central Intelligence Agency, “International Studies Review”, November 30, 1979, Secret, 14; NACP. Indigenous resources (coal, natural gas, oil) were very limited; and prospects for hydroelectric power were slim. Yager, “Taiwan”, 66-67; Surrey, “Nuclear Power”, 469.

1445 Rowen, “Taiwan: Will Derecognition Increase Nuclear Temptations?”, 20.

1446 Surrey, “Nuclear Power”, 466.

1447 “By 1999 it hoped to have a total of 20 nuclear power-generating units.” BBC Summary of World Broadcasts, “Nuclear Energy”, FE/W1048/A/28, September 12, 1979. In 1978 nuclear power accounted for 2% of the total energy consumption. BBC Summary of World Broadcasts, “Energy Supply and Conservation Measures”, FE/W1036/A/34, June 20, 1979. By 1992 nuclear power actually contributed 43.2% of total electricity generation by 1992. Chuanwen Hu and Georg Woite, “Nuclear power development in Asia”, IAEA Bulletin, 4 (1993), accessed October 5, 2012, http://www.iaea.org/Publications/Magazines/Bulletin/Bull354/35404780207.pdf

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were to be US-supplied.1448 This made US nuclear sanctions potent, as evinced by Vice Foreign

Minister Chien’s query whether compliance would result in “assured” nuclear fuel supply from the United States.1449 Chien and Economic Affairs Minister Sun Yun-Hsuan seemed to convey to American officials that “it would be folly for ROC to endanger its nuclear power program by conducting nuclear activities of questionable nature”.1450 Foreign Minister Shen also told

Ambassador Unger that the nuclear program was essential for Taiwan’s economic development, and that it depended on fuel supply from the United States.1451

In addition to these nuclear sanctions the United States also conveyed that it would suspend economic assistance for non-compliance on the nuclear issue. As shown below, such sanctions on the overall economic relationship could potentially be devastating as Taiwan greatly depended on the United States for its economic sustenance.

First, Taiwan’s nuclear energy program was not only technically dependent but also financially dependent on the United States. The ROC nuclear program was “an all-American

1448 Ironically, this near-total dependence on the United States for its nuclear energy program made it less likely that the United States would completely abandon its ally, in whom it had important economic interests. Melinda Liu notes that Ex-Im Bank loans to Taiwan “will in fact complicate plans for the derecognition of the Nationalist Chinese.” Moreover, the United States “does not want to force Taiwan into seeking other suppliers of nuclear equipment.” Liu, “Accounting for the N-Factor”, 34. Also, Yager writes, “They [ROC leaders] may also see political advantages in an energy policy that increases the economic stake of the United States in Taiwan.” Yager, “Taiwan”, 69.

1449 Chien asked the visiting US team if the ROC would be “assured” of US nuclear supply if it complied US demands on nonproliferation. Team head Burton Levin “stated that in that event, the US would adopt a forthcoming attitude on fuel supply.” Cable from American Embassy, Taipei to State Department, Washington D.C., "US Nuclear Team Visit to ROC - Calls," January 19, 1977, Confidential, Cable 332; NSA.

1450 Cable from American Embassy, Taipei to State Department, Washington D.C., "US Nuclear Team Visit to ROC - Calls," January 19, 1977, Confidential, Cable 332; NSA.

1451 Cable from American Embassy, Taipei to State Department, Washington, D.C., “Ambassador meets with Foreign Minister Shen to Discuss Recent Press Reports Concerning Reprocessing on Taiwan”, August 3, 1976, Confidential, Cable 5965; NSA.

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affair” due to loans from the US Ex-Im Bank, which authorized $2.2 billion by mid-1980.1452

According to John Surrey, Taiwan’s “client status” meant that it did not hesitate to accept “soft loans” to buy US nuclear technology and become dependent on US nuclear fuel cycle services.1453 Nuclear power was an important means of meeting its energy requirements as the

ROC’s only alternative was importing oil.1454 The oil crises of the 1970s had a drastic effect on

Taiwan.1455

Second, Taiwan’s rapid economic growth was based on a tremendous increase in exports as shown in the figure below.

Figure 5. 1. Taiwan’s export growth

Source: Plotted based on data from Taiwan Statistical Data Book, Council for Economic Planning and Development, Executive Yuan, ROC (Taiwan) (Taipei, 2007).

1452 Surrey, “Nuclear Power”, 469. In 1976 Taipower was the single largest loan customer of the Bank. Liu, “Accounting for the N-Factor”, 33.

1453 Surrey, “Nuclear Power”, 476.

1454 Yager, “Taiwan”, 67.

1455 Overholt, “Nuclear Proliferation in Eastern Asia”.

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The United States was Taiwan’s largest trading partner, accounting for 34.3% of total commodity trade in 1975.1456

Figure 5. 2 Taiwan’s major trade partiners, 1975

Source: Based on information from Taiwan Statistical Data Book, Council for Economic Planning and Development, Executive Yuan, ROC (Taiwan) (Taipei, 2007).

Given that international trade was the engine of economic growth for Taiwan, a curtailment of US trade relations would have significantly hampered the economy.1457 Under the

1456 Council for Economic Planning and Development, Taiwan Statistical Data Book, (Taipei: Executive Yuan, R.O.C., 2007).

1457 Robert Baldwin et al write: “Taiwan is not only one of the most heavily trade-dependent countries in the world, but it also has one of the highest degrees of dependence on two trading partners of any semi-industrial/industrial economy.” Baldwin et al, Political Economy of US-Taiwan Trade, 83. 249

export-oriented policy growth was led by the rapid increase in exports, which were only 9 percent of GNP in 1950s but rose to over 53 percent in the 1980s. After perpetual trade deficits,

Taiwan’s economy generated trade surpluses for the first time in the mid-1970s.1458

International trade became the “lifeblood” for its sustenance,1459 with the United States a key partner in the export-driven growth.1460

Third, Taiwan had received massive amounts of US economic aid in the 1950s and early

1960s.1461 American assistance continued in other forms after the termination of economic aid in

1965, such as a new food agreement and the setting up of a bilateral fund that would disperse money into development programs – American involvement was now more in the form of grants and low-interest loans.1462 Fourth, the United States was also an important source of investment and loan capital for Taiwan.1463

Thus without doubt Taiwan’s economic miracle is attributable in significant part to massive economic assistance from the United States.1464 Baldwin et al state that “By virtually all

1458 Lasater, US Interests in the New Taiwan, 74.

1459 Szu-yin Ho, “The Republic of China’s Policy Toward the United States, 1979-1989” in Yu San Wang, ed., Foreign Policy of the Republic of China on Taiwan: An Unorthodox Approach (New York: Praeger, 1990), 35.

1460 Hickey, Taiwan’s Security in the Changing International System, 102.

1461 Taiwan received an annual average of $100 million in nonmilitary aid from 1950 to 1965, a sum that was more than the per capita US contribution to any other country at the time. Tucker, Taiwan, Hong Kong, 54; Clough, Island China, 34. Total economic assistance between 1950 and 1965 was almost $1.5 billion. Letter from David M. Abshire, Assistant Secretary for Congressional Relations to Representative Fred Schwengel, August 21, 1970; NACP.

1462 Tucker, Taiwan, Hong Kong, 109.

1463 Telegram from American Embassy, Taipei to Secretary of State, Washington, D.C., May 25, 1973, Taipei 3088; NACP.

1464 Wang, “Foundation of the Republic of China’s Foreign Policy”.

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direct measures, Taiwan is about as dependent as a country can be without being a colony.”1465

Hence US sanctions, if they had been imposed, would have been economically devastating.

Such economic costs from US sanctions would significantly reduce the income available to the ROC government. Since the regime would now have to use its scarce financial resources for basic regime functioning and survival, it is likely that the nuclear program would stall; the government would find it difficult to pay for new reprocessing facilities. Thus, if the United

States had carried through with its threat of economic sanctions, financial constraints would likely have contributed to the slowing or stopping of the nuclear program.1466

Conclusion: Sanctions and Resource Denial

As this discussion shows, the imposed US sanctions (in the form of delays in nuclear supplies) did not significantly constrain resources for Taiwan’s nuclear weapons program. The threatened US sanctions had the potential to inflict devastating damage on Taiwan’s economy.

Since they were not actually enforced, they did not have this resource denial effect in Restraint

2. Nevertheless any cost-benefit calculations about conceding to US demands would likely include some consideration of the potential for such resource denial.

In other words, the US sanctions on Taiwan did not directly limit resources for the nuclear weapons effort since they were (largely) threatened and not actually imposed; however their potential to inflict heavy damage likely entered regime calculations on the desirability of nuclear restraint. This is discussed below.

1465 Baldwin et al, Political Economy of US-Taiwan Trade, 84.

1466 However, as noted in the theory chapter, resource denial cannot roll back a nuclear weapons program.

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Motivational Changes 1976-78

The motivational factors persuading the leadership to undertake Restraint 2 lay in the security and domestic politics models. Taiwan was heavily dependent on the United States for its existence as an independent political entity – a dependence that arose from both economic and political considerations. Hence any threats to American support automatically jeopardized national and regime security. The regime’s domestic legitimacy rested principally on the island’s economic success, which would be endangered by the loss of US assistance. As argued here, the ultimate goal of survival was met by the immediate need of economic progress; hence the proximate concern was economic in both the security and domestic politics models.

Security Model

The ROC was supported by American political, military, economic, and ideological assistance for more than 100 years from the time the KMT’s founder Sun Yat-sen raised money in the United States during the revolution in China.1467 With the onset of the Korean War in

1950 the United States significantly increased military and economic aid to the ROC, now based in Taiwan.1468 Its implicit security guarantee was codified in the bilateral Mutual Defense Treaty of 1954.1469 In 1955 Congress passed the Formosa Resolution, which authorized the President to

1467 Swaine and Mulvenon, Taiwan’s Foreign and Defense Policies, 128-129.

1468 With the Korean War, Taiwan became important for the United States in the emerging cold war since Mao’s China was planning to invade the island. Tucker, Taiwan, Hong Kong, 35.

1469 Without explicitly calling for a direct or automatic US defense of Taiwan, the Treaty entailed that the United States would defend Taiwan “in accordance with its constitutional processes”. See Article V of the Mutual Defense Treaty between the United States and the Republic of China, December 2, 1954. http://avalon.law.yale.edu/20th_century/chin001.asp Other forms of military support included the Military Assistance Advisory Group, which trained and equipped KMT troops since 1951; the deployment of nuclear-capable Matador missiles in 1957; and increasing No.s of American military personnel, No.ing 10,000 by 1970. Tucker, Taiwan, Hong Kong, 67, 111; Clough, Island China, 23.

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use American forces for the defense of Taiwan “as he deems necessary”.1470 Although US support began declining in the late 1960s,1471 Taiwan continued to be very dependent on the

United States due to its increasing international isolation in the 1970s.1472 Taiwan’s leaders and the public perceived US support as imperative for survival.1473 Its concern about how the United

States viewed its nuclear program is seen in a number of ways during exchanges with American officials on the nuclear issue.1474

The erosion of the bilateral relationship, under US overtures to the PRC best represented by the Shanghai Communiqué of 1972, was an important push for the nuclear weapons effort.1475 Since American actions were themselves an important cause of nuclear pursuit, it was possible for the United States to persuade the ROC that it could retain US assistance in

1470 Text of the resolution, accessed October 1, 2008, http://cns.miis.edu/straittalk/Appendix%2016.htm.

1471 The United States limited economic aid to Taiwan from 1965; and in 1967 Congress reduced funds for the military assistance program by half. Tucker, Taiwan, Hong Kong, 94, 112. The decision to terminate economic aid on concessional terms was taken due to the significant advances in Taiwan’s economy . Clough Island China, 23. The Nixon administration stopped all aid to Taiwan in 1969. The US Seventh Fleet also stopped patrolling the Taiwan Strait (doing so since the Korean War) in 1970. Clough, Island China, 99. The United States started withdrawing troops from Taiwan after signing the Shanghai Communiqué with the PRC in 1972. The Formosa Resolution was repealed in 1974. All nuclear-capable missiles were removed from Taiwan in 1974 as part of US- PRC rapprochement -- curtailing US arms supply to Taiwan was one of Deng Xiaoping’s stipulations for full normalization. Roy, Taiwan, 128; Bush, At Cross Purposes, 160.

1472 With the ROC’s expulsion from the UN in 1971, more and more countries broke off diplomatic relations. In 1968 both Taiwan and the PRC had diplomatic relations with 45 countries each; by 1979 this changed to 117 countries for the PRC and only 24 for Taiwan. Roy, Taiwan, 133.

1473 Swaine and Mulvenon, Taiwan’s Foreign and Defense Policies, 131.

1474 For example, CCK told Ambassador Unger that the ROC would give up its plans for a reprocessing facility “to avoid any misunderstanding”; and that Taiwan would comply with US wishes because it wanted “good relations with the United States”. Cable from American Embassy, Taipei to State Department, September 15, 1976, Cable 6272; NSA. Taiwan’s concerns about US reactions are best seen in the offer by Chiang Ching-kuo to host permanent American officers to inspect the nuclear program. Chiang invited one to three American experts to be stationed on the island for the purpose of monitoring the nuclear program at the expense of the Taiwanese government. The US government considered the offer but did not end up acting on it, deciding instead to send periodic inspection teams in order to retain its flexibility and reduce its dependence on the ROC, which might otherwise dictate the terms of inspections. Cable from American Embassy, Taipei to State Department, September 15, 1976, Cable 6272; NSA.

1475 It stated that American forces would “ultimate[ly]” withdraw from Taiwan. Text of the Shanghai Communiqué, CNN Historical Documents, http://www.cnn.com/SPECIALS/cold.war/episodes/15/documents/us.china/

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exchange for nuclear restraint. A key component of this was the continued supply of arms, which was worth about $200-$300 million annually in the mid-1970s.1476 Thus Taiwan was better able to derive security benefits from its dependent relationship with the United States rather than from pursuing nuclear weapons.1477

It is important to note that Taiwan’s security threats were not assuaged by new political commitments, but that it chose to accept the evolving political situation so long as it had a close relationship with the United States. This is especially striking in view of the fact that the United

States severed formal relations with the ROC in 1979.1478 By 1975 the United States withdrew all its combat aircraft; and the last military advisers left in 1976. Also in 1976 MIT terminated a program to train 15 ROC engineers under pressure from the US government due to possible use in Taiwan’s plan to develop a missile guidance system.1479 The fact that Taiwan faced declining security commitments from its superpower benefactor suggests that the security concerns alone do not explain Restraint 2.1480 Considerations based on economic factors appear to have intertwined with security motives in contributing to Restraint 2.

1476 Tucker, Taiwan, Hong Kong, 146.

1477 Overholt, “Nuclear Proliferation in Eastern Asia”, 144; Clough, Island China, 120; Mitchell, “Taiwan’s Hsin Chu Program”, 309; Solingen, Nuclear Logics; Lefever, Nuclear Arms.

1478 However the United States increased its sale of conventional arms to the ROC during this time, including the sale of a radar air defense system and Hawk missiles and launchers. American arms sales to Taiwan increased from $196 million in 1974 o $215 million in 1975 to $293 million in 1976. “Taiwan”, Keesing’s Record of World Events, 23 (February 1977), p. 28218.

1479 “Taiwan”, Keesing’s Record of World Events, 23 (February 1977), p. 28218.

1480 Hersman and Peters, “Nuclear U-Turns”, 547-548.

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As stated earlier, economic growth had become an important source for sustaining

Taiwan’s independent status in the late 1960s and 1970s.1481 Chiang Ching-kuo (CCK) focused first on economic liberalization, and then on political reform as a way of countering external threats.1482 The emphasis on the economy further increased Taiwan’s dependence on the United

States as a trade partner and source of investment. Thus Taiwan’s dependence on the United

States both for security and economic support – a dependence that was deepened in the 1970s – led the regime to acquiesce to US demands. The principal goal in the security model was national survival.

Domestic Politics Model

Besides acting as a counter to losses in international politics, economic growth was also important for domestic reasons. In the domestic politics model, economic factors motivated the regime to undertake restraint for the purpose of regime survival.

Since it did not rely on repressive means as the basis of domestic power, economic success was an important source of legitimacy for the KMT regime. Indeed the leadership

(under both Chiang Kai-shek and his son Chiang Ching-kuo) prioritized economic development.1483 Decline in exports due to the global recession in the 1970s put greater pressure

1481 Bureau of Intelligence and Research, State Department, “Intelligence Note”, October 29, 1971; NACP; “Balancing the Tiger with the Wolf”, Time, 106 no. 2 (July 14, 1975); John Franklin Copper, “Political Development in Taiwan” in Hungdah Chiu, ed., China and the Taiwan Issue (New York: Praeger, 1979).

1482 Ching-fen Hu, “Taiwan’s Geopolitics and Chiang Ching-kuo’s Decision to Democratize Taiwan”, Stanford Journal of East Asian Affairs, 5 no. 1 (2005), 31; Swaine and Mulvenon, Taiwan’s Foreign and Defense Policies, 132.

1483 This was partly due to the need to win support from the peasantry – alienating them had been an important reason for the KMT’s failure in the Chinese civil war, underlining the necessity for reform and development; and partly due to US pressure for liberalization. Clark, Taiwan’s Development, 123; 125-126; Sheldon L. Appleton, “The Year It Finally Happened”, Asian Survey, 12 no. 1 (1972), 36. Solingen notes that the strategy of “nurturing a thriving economic system” was “at the core of the KMT’s effort to stem domestic threats to its own survival.” Solingen, Nuclear Logics, 109.

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on the government to “create prosperity”.1484 Over time the need to sustain economic development became more important.1485

Despite being an authoritarian regime, in the 1970s the KMT government had to face important issues of domestic legitimacy. First, the ROC’s declining international status strengthened existing challenges to the regime on such issues as its exclusion of the local

Taiwanese and the goal of recovering the mainland. Clashes between the mainlanders and the ethnic Taiwanese -- which had existed since the KMT fled to Taiwan in 1949 – strengthened with the international political losses of the 1970s, giving rise to organized dissent.1486 Second,

Chiang Ching-kuo (CCK) had to establish his own position as legitimate leader of the ROC.1487

For this he had to overcome some negative impressions from the 1950s and 1960s when he had led the state secret service, running a KGB-style network to ensure popular allegiance to his father’s rule.1488 It is said that CCK’s eventual dominance of economic policy partly arose from the need “to establish credibility in economic affairs in order to secure legitimacy as his father’s

1484 John C. H. Fei, “The Taiwan Economy in the Seventies” in Shao-chuan Leng, ed., Chiang Ching-kuo’s Leadership in the Development of the Republic of China on Taiwan (Miller Center, University of Virginia, University Press of America: Lanham, 1993), 71.

1485 Solingen, Nuclear Logics, 111.

1486 Wu, A Political Explanation of Economic Growth, 188. A principal exception was the Taiwan Independence Movement, which had existed from before KMT rule. Clark, Taiwan’s Development, 130.

1487 CCK had become Premier in 1972, and remained an important, if not the ultimate, decision-maker since then. There is little doubt that CCK was the main leader after Chiang Kai-shek died in 1975, although he became President only in 1978.

1488 According to Cho-yun Hsu, CCK was “regarded as ruthless and reactionary, alienated from the intellectuals, and distrusted by other members of the Chiang Kai-shek government. Furthermore the tarnished image of a ruthless leader using the intelligence service to gain power remained unchanged until the very last years of his life.” Cho-yun Hsu, “Historical Setting for the Rise of Chiang Ching-kuo”, in Leng, ed., Chiang Ching-kuo’s Leadership, 12.

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successor.”1489 These domestic concerns therefore underlined the importance of economic growth for the purpose of regime stability.

Although initially consumed by security matters alone, CCK dominated the economic milieu in the 1970s. Economic policy-making changed “dramatically” under him, and was implemented by technocrats.1490 Defense spending as a proportion of total government expenditure declined under CCK, from 60 percent in the 1950s and 1960s to 43.8% in 1972, to

39.1% in 1976, and 37.1% in 1978. This suggested “a major priority shift from recovering the mainland militarily to addressing the needs of the people in Taiwan.”1491

The domestic model also highlights the internal decision-making process and the role of

CCK, who was the ultimate leader during Restraint 2. His decision on nuclear restraint is especially striking since he had advocated a nuclear weapons option years before. CCK is described as being astute enough to recognize key problems.1492 His main foreign policy adviser was Foreign Minister Shen Chang-huan. Like CCK, Shen believed that Taiwan should maintain close relations with the United States.1493 CCK was the ultimate arbiter of differences between different sections within the government, particularly the military and the technocrats.

1489 Wu, A Political Explanation, 199.

1490 Wu, A Political Explanation, 199. In 1969 CCK became the deputy premier and began to take charge of economic affairs. Within a few years he became the hub of major economic policies. Whereas Chiang Kai-shek had been largely interested in political/ security and military affairs and allowed more leeway on economic policies to his subordinates, CCK directly made economic policy with advisors. Wu, A Political Explanation, 148; 195-198.

1491 Hu, “Taiwan’s Geopolitics”, 34-35.

1492 Copper, “Political Developments in Taiwan”, 70.

1493 Ralph N Clough, “Chiang Ching-kuo’s Policies Toward Mainland China and the Outside World” in Leng, ed., Chiang Ching-kuo’s Leadership, 134-135.

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The weapons program had been the pet project of the military1494 while the technocrats favored economic development and nuclear energy.1495 In the tug of war between the two sections, the technocratic voice was more dominant -- the military’s direct and formal engagement with the nuclear program had been terminated; and the export-oriented growth strategy of the 1960s meant that the military had to relinquish its desire to develop domestic defense industries.1496 These differences were evident in discussions with American officials.

For example AEC Secretary-General Victor Cheng seemed to appreciate US concerns, and

Taipower officials were concerned with ensuring a reliable fuel supply for their planned nuclear power reactors;1497 however the director of the military’s Chungshan institute, General Tang, seemed to disagree with official ROC responses to the United States.1498 Similarly American officials wanted to influence INER Director Chien Chi-peng and his associates to “steer” the

INER away from fuel cycle capability.1499 One way of doing this, they believed, was to encourage Taipower’s links with INER,1500 “despite its [Taipower’s] past reluctance to do

1494 Solingen, Nuclear Logics, 102.

1495 These were officials associated with the civilian AEC and Taipower, the state-owned electric company.

1496 Clark, Taiwan’s Development, 174; Bureau of Intelligence and Research, State Department, Nuclear Weapon Intentions of the Republic of China, February 15, 1973, Secret; NSA.

1497 For example, regarding US concerns about a uranium enrichment program at the military’s CIST, Victor Cheng “understood and seemed to accept the concerns of the [visiting US technical] team” and “asked what more they could do about it.” Similarly, Taipower Chairman L. K. Chen seemed to reassure American officials that General Tang of CIST would be retiring soon. Cable from State Department, Washington, D.C. to American Embassy, Taipei, “US Nuclear Team Visit”, August 9, 1978, Secret Nodis, Cable 201370; NSA.

1498 Cable from American Embassy, Taipei to State Department, Washington, D.C., “Nuclear Team Visit: Initial Calls: Discussions with CIST Director Tang”, July 31, 1978, Secret Exdis, excised copy, Cable 4988; NSA.

1499 General Tang was always very interested in INER’s program, and he trained INER Director Chien Chi-peng as well as Vice Director Li Yu-hao in nuclear research. Chien had initiated the plan to acquire a large reprocessing plant. Cable from American Embassy, Taipei to State Department, Washington, D.C., “Chung Shan Nuclear Research Institute”, February 24, 1973, Secret Exdis, Cable 1197; NSA.

1500 According to then Ambassador McConaughy, Taipower President L. K. Chen “is uninterested in reprocessing” and was unaware of existing efforts by the Chung-shan institute. Cable from American Embassy, Taipei to State 258

so.”1501 Embassy officials sought to influence “moderate” elements in the “nuclear leadership” such as Victor Cheng of the AEC.1502 Most mid-level officials were also unaware of nuclear restraint as a result of US pressure – for example, INER officials believed that the TRR was being shut down for maintenance.1503

During the meeting with Ambassador Unger for the first demarche in September 1976,

Foreign Minister Shen tried to find out exactly what the United States knew about the reprocessing attempts, and how it knew it.1504 Vice Foreign Minister Chien seemed genuinely

“bewildered” by US accusations during the second demarche of January 1977, suggesting that he was unaware of INER’s continuing interest in reprocessing.1505 Chien also queried on what penalties Taiwan would have to face for noncompliance, apparently as “ammunition” to use in domestic policy circles.1506

The repeated efforts to acquire reprocessing technology in the 1970s seems to have been led by the military establishment as well as by CCK, who apparently never really gave up his

Department, Washington, D.C., “Chung Shan Nuclear Research Institute”, February 24, 1973, Secret Exdis, Cable 1197; NSA.

1501 Ambassador Unger wrote, “We hope that the power generation needs to Taipower will act as a lever on INER, and that closer association between these two organizations will assist us to implement our non-proliferation and nuclear energy policies.” Cable from American Embassy, Taipei to State Department, Washington, D.C., “US Technical Team Visit”, June 6, 1977, Secret, Cable 3310; NSA.

1502 Cable from U.S. Embassy, Taipei to State Department, "Visit of CAEC Secretary General - Dr. Victor Cheng," May 6, 1977, Secret (repeated to Brzezinski at White House), Secret Nodis, excised copy, Cable 2646; NSA.

1503 AEC Secretary General Victor Cheng was also keen to limit such information to a few key officials. Cable 117288.

1504 Cable from American Embassy, Taipei to State Department, Washington, D.C., “Demarche on ROC’s Nuclear Intentions”, September 9, 1976, Secret Exdis, Cable 6100; NSA.

1505 Cable from American Embassy, Taipei to State Department, Washington D.C., “Taiwan’s Continued Interest in Reprocessing”, January 12, 1977, Secret, Cable 209.

1506 Cable from American Embassy, Taipei to State Department, Washington D.C., "US Nuclear Team Visit to ROC - Calls," January 19, 1977, Confidential, Cable 332; NSA.

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ambition to acquire weapons capability.1507 Despite such continuing interests, Taiwan undertook

Restraint 2 under US pressure, principally driven by economic concerns as described above. As

Solingen sums up, “Without IAEA and US endorsement, the nuclear energy program was threatened. Without energy and US preferential trade status, the economic miracle was doomed.

Without a sustained economic miracle, the KMT’s political prospects were fragile.”1508

It is fairly clear that the US pressure on Taiwan worked by means of threats on the existing relationship rather than on the promise of any rewards. At best the United States would not suspend nuclear supplies.1509 The fact that Ambassador Unger was himself unsure as to US intent to act on this assurance, especially in view of the Shanghai Communiqué, suggests that the ROC did not receive any obvious inducements.1510

Conclusion: Motivational Changes 1976-78

This section has shown how both security and domestic considerations persuaded the regime to undertake restraint, with economic factors playing a key role in both models. In the

1507 Mitchell, “Taiwan’s ‘Hsin-Chu’ Program”, 295, 300; Hersman and Peters, “Nuclear U-Turns”, 544.

1508 Solingen, Nuclear Logics, p. 113.

1509 No carrots were offered other than vague allusions to the possibility of assuring fuel supply -- Cable from American Embassy, Taipei to State Department, November 23, 1973, Cable 7051; “ROC Nuclear Energy Plans”, Memorandum of Conversation, State Department, August 29, 1973. In the demarche of March 1977, Ambassador Unger was instructed to state, if asked, that the US government would try to satisfy ROC requests on fuel supply although the administration was constrained by congressional and other prerogatives. Cable 67316. There is no publicly available information suggesting that the United States made any promises on fuel supply. Even a study on positive incentives notes that Taiwan’s reversal was driven more by the threat of denying existing US relations than the offer of additional incentives. Thomas Bernauer, “Positive Incentives in Nuclear Nonproliferation and Beyond” in Thomas Bernauer and Dieter Ruloff, eds., The Politics of Positive Incentives in Arms Control (University of South Carolina Press, 1999), 171-172).

1510 Cable from American Embassy, Taipei to State Department, Washington, D.C., “Nuclear Representation to the ROC”, March 26, 1977, Secret, Cable 1682; NSA. On Unger’s urging, the United States conveyed to AEC Secretary General Victor Cheng that it had approved the export of 20% enriched uranium fuel for the Tsinghua reactor. This was given as a gesture of continued US nuclear support as the reactor would soon runt out of fuel. Cable from American Embassy, Taipei to State Department, Washington, D.C., May 6, 1977, Secret, Cable 2646; Cable from State Department, Washington, D.C. to American Embassy, Taipei, “US Technical Team Visit, Victor Cheng to Visit Washington”, May 21, 1977, Secret Exdis, Cable 117288; NSA.

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security model, Taiwan’s economic success was critical to its status as an international entity; in the domestic model, economic growth helped preserve regime survival.

Table 5.8 Summary of Taiwan’s restraint 2 (rollback) 1977-78

Causes of restraint Present? Resource Constraints: Techological No Did sanctions impose significant resource constraints on NW Financial No program? Motivational Changes: Security Yes Did sanctions induce motivational changes in NW program? Domestic Politics Yes

Prestige No

Restraint 3 – (Rollback) 1988

After abandoning the reprocessing program under US pressure, Chiang Ching-kuo apparently ordered privately that research work should continue.1511 In the early 1980s Taiwan’s external security situation further worsened, most notably with the severance of formal diplomatic relations with the United States in 1979, and the abrogation of the Mutual Defense

Treaty in 1980. American military presence on the island, reduced to just 600 by late 1978, ended early in 1979.1512 US arms sales fell drastically from $598 million in 1979 to $290 million in 1980. Both the leadership and the public in Taiwan were nervous about these developments.1513 In 1982 the United States concluded a communiqué with the PRC, promising

1511 Taylor, The Generalissimo’s Son, 324.

1512 Tucker, Taiwan, Hong Kong, 145; Hu, “Taiwan’s Geopolitics”, 35.

1513 Tucker, Hong Kong, Taiwan, 148.

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to gradually reduce arms sales to Taiwan. Apparently in response, Chiang Ching-kuo ordered the military to accelerate weapons development, with nuclear weapons as priority.1514

In 1987-1988 American officials learned that Taiwan was constructing a small plutonium reprocessing plant. The discovery followed the CIA-assisted defection of INER deputy director

Col. Chang Hsien-yi.1515 Under US pressure Taiwan stopped further work on the facility and dismantled the TRR by March 1988.1516 It had not separated any plutonium, but American officials believed that Taiwan was only a year or two away from developing a nuclear bomb.1517

This final phase of nuclear restraint concluded just two months after the death of Chiang Ching- kuo in January 1988.1518

Taiwan agreed to “conclusively and verifiably” end its nuclear weapons program, involving a written guarantee from the new President Lee Tung-hui to shut down the TRR and end the nuclear weapons program.1519 It informed the IAEA that it was shutting down the reactor for “economic” reasons1520 and prohibited any research related to weapons development.

Thus Taiwan undertook some far-reaching commitments “beyond those obligations mandated by the Nuclear Non-Proliferation Treaty.”1521

1514 Taylor, The Generalissimo’s Son, 373.

1515 Mitchell, “Taiwan’s Hsin Chu Program”, 300; Stephen Engelberg and Michael R. Gordon, “Taipei Halts Work on Secret Plant to Make Nuclear Bomb Ingredient”, New York Times, March 12, 1988.

1516 Spector, The Undeclared Bomb, 75.

1517 Mitchell, “Taiwan’s Hsin Chu Program”, 300.

1518 However construction on the reprocessing plant did continue under the new President Lee Teng-hui, Lee was probably not aware of the facility and its activities. Albright and Gay, “Taiwan”, 59.

1519 Mitchell, “Taiwan’s Hsin Chu Program”. 300.

1520 R. Jeffrey Smith and Don Oberdorfer, “Taiwan to Close Nuclear Reactor; U. S. Voiced Concern on Spread of Weapons”, The Washington Post, March 24, 1988.

1521 Mitchell, “Taiwan’s Hsin Chu Program”, 301; Engelberg and Gordon, “Taipei Halts Work”.

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The decision to undertake Restraint 3 was apparently taken due to concerns that continued pursuit of the weapons option would seriously jeopardize relations with Washington.

President Reagan is reported to have instructed his envoy David Dean to insist on a written assurance from Lee Tung-hui.1522 More details on the exact nature of the US pressure are not available, but the United States conveyed that issues of nuclear nonproliferation were of utmost concern.1523

Restraint 3: Motivational or Resource Driven?

Limited information makes it difficult to assess in any detail the nature and causes of

Restraint 3. Hence the following discussion is largely speculative. It would appear that restraint was motivation-driven since there is no obvious indication of resource denial. The motivations may have been based on security factors relating to dependence on US support, as well as domestic political considerations as the country was in a period of flux with unprecedented political reforms.

Sanctions and Restraint 3

There is no public information regarding any sanctions on Taiwan around this time.

However, it is highly likely the United States pressured Taiwan by threatening sanctions on some or all aspects of their relationship. This section discusses the possible resource denial as well as motivational impact from such sanctions.

(a) Resource Denial 1988

Technology Denial

1522 Mitchell, “Taiwan’s Hsin Chu Program”, footnote 23.

1523 Smith and Oberdorfer, “Taiwan to Close Nuclear Reactor.”

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Taiwan’s pursuit of reprocessing technology in the 1980s was, like in the 1970s, based on non-US sources. The New York Times reported in 1982 that Taipower officials were discussing with a subsidiary of the French Atomic Energy Commission to obtain assistance in reprocessing spent fuel.1524 Since the 1970s Taipower had been concerned with obtaining a reliable supply of fuel for its nuclear power plants.1525 Lack of further information on reprocessing efforts in the

1980s precludes a more detailed analysis of Taiwan’s dependence on the United States for the technology. However, as in Restraint 2, it is likely that Taiwan did not need further US technological assistance for its weapons effort. Thus US sanctions would probably fail to deny technology for the nuclear weapons effort.

Financial Constraints

During Restraint 3 Taiwan’s trade relationship with United States was even stronger than that of the 1970s. Taiwan successfully dealt with the 1979 oil crisis partly by increasing its exports to the United States. By 1984 US share of ROC exports reached its peak of 48.8%. By the mid-1980s “the US market fueled almost half of Taiwan’s export growth”.1526

It is therefore evident that the disruption of this trade relationship with the United States would have inflicted still greater costs than in the 1970s.1527 Such economic costs may not have seriously affected the nuclear weapons effort since the regime was under less pressure to prove

Taiwan’s economic success in the 1980s. Hence such possible US sanctions may not have

1524 “Taiwan Acts to Widen its Nuclear Technology”, New York Times, June 23, 1982.

1525 For example in 1973 senior AEC and Taipower officials voiced this concern to American officials. Cable from American Embassy, Taipei to State Department, Washington D.C., “Proposed ROC Reprocessing Plant”, January 31, 1973, Cable 685; NSA.

1526 Baldwin et al, Political Economy, 15-16.

1527 This is underlined by the fact that some serious economic problems emerged around 1985, with the bankruptcy of a large credit cooperative and the ensuing credit crunch. The government resolved to liberalize imports in response. Baldwin et al, Political Economy, 16-17.

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denied financial resources for the nuclear weapons effort. However, as in Restraint 2, the extent of the possible damage from US economic sanctions may have factored into regime motivations as discussed below.

(b) Motivational Changes 1988

Restraint 3 is likely to have been driven by motivational considerations on the security and economic consequences of the withdrawal of US support.

Security Model

Increased security concerns in the early 1980s were presumably the primary catalyst for the reprocessing program. Unlike in the 1970s, this attempt was largely secret and was discovered due to information from Col. Chang Hsien-yi, a key informant of the CIA.1528 It could be that Taiwan was conducting the effort secretly partly due to PRC enunciation of this as a condition to attack Taiwan.1529 American arms assistance to Taiwan was robust in the 1980s despite the 1982 arms sales communiqué with the PRC. According to one author, US arms sales can be said to have actually increased between 1983 and 1988.1530 Restraint 3 could have been motivated by the threat of losing existing US military support.

Security factors, however, may not have been the paramount consideration during

Restraint 3 since the threat from the PRC had decreased compared to that in the 1960s and

1970s. Under Deng Xiaoping the PRC had initiated contact with Taiwan, calling for talks and

1528 In the late 1970s there had been press reports in the United States on Taiwan’s reprocessing attempts. Moreover, Chiang Ching-kuo had stated more than once that Taiwan had the ability to build nuclear weapons.

1529 The circumstances which would supposedly induce the PRC to attack Taiwan were: if Taiwan is controlled by a foreign power, if it develops nuclear weapons, if it declares independence, if the KMT loses control over the island, or if Taiwan indefinitely refuses to negotiate re-unification. Lasater, US Interests in the New Taiwan, 134. This was emphasized by Deng Xiaoping in the 1980s.

1530 Officially, the United States was curbing arms sales to Taiwan. But arms sales can be said to have increased if they are computed differently. Tucker, Taiwan, Hong Kong, 178.

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opening trade, transportation, academic, and sports exchanges.1531 In addition, the PRC decided to stop shelling the offshore islands of Quemoy and Matsu with the onset of official relations with the United States (January 1979). The possibility of an actual attack by the PRC seemed diminished in the 1980s.1532

The launch of the repeated nuclear weapons attempt in the 1980s may have been a response to the declining US commitment. However there was no obvious increase in US support that would explain why the leadership undertook Restraint 3. The motivations for restraint are therefore better explained by domestic political and economic considerations.

Domestic Politics Model

In the 1980s CCK began some significant political reforms, culminating in the lifting of martial law in 1987 and the legalization of opposition parties.1533 This effort at political liberalization was partly a strategic response to conciliatory policies by the PRC in the 1980s.

Chiang Ching-kuo believed that socio-cultural and economic contact with the PRC would help project a positive image of Taiwan on the mainland.1534 He held that the existing policy of economic liberalization should be followed by political liberalization.1535 It was also a response to the reality of domestic pressures – since 1977 violence between the local Taiwanese and mainlanders grew; in 1979 there was a major incident when the government responded to a

1531 Clough, “”Chiang Ching-kuo’s Policies”, 152. Taiwan officially rejected calls for trade and travel (until 1987, after which it began permitting travel and communication), but began unofficial trade in the early 1980s.

1532 Tucker, Taiwan, Hong Kong, 148; 160.

1533 Taiwan was under martial law since 1949.

1534 Andrew J. Nathan and Helena V. S. Ho, “Chiang Ching-kuo’s Decision for Political Reform”, in Leng, ed., Chiang Ching-kuo’s Leadership, 38; Taylor, The Generalissimo’s Son, 344-346.

1535 Taylor writes, “At least since the early 1970s, Ching-kuo had believed that Taiwan would have to become a successful political as well as economic model if over the long term it was to remain viable.” Taylor, The Generalissimo’s Son, 369.

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radical opposition group by arresting its top leaders following street protests. Taiwan’s opposition movement found a friendly voice among US members of Congress.1536 Thus, precipitated by both external and domestic factors, CCK gradually embarked on political liberalization. By 1983 he decided that his successor should be a native Taiwanese.1537 In

March-April 1986 CCK appointed a task force to recommend proposals to make significant changes including the lifting of martial law, forming new political parties, and reform the governance structure.1538

Ultimately CCK may have been motivated to undertake political reforms for the purpose of preserving the regime after his death. The move to political liberalization intensified as his health deteriorated.1539 Thus when Restraint 3 occurred, Taiwan was well on the road to dramatic political liberalization, marked by violent mass protests.1540 Since this was a time of major political influx, it would be reasonable to surmise that the ROC government would not wish a major upheaval in the form of the withdrawal of US support. Hence domestic political pressures may have helped motivate Restraint 3.

Such considerations were likely bolstered by Taiwan’s continued economic dependence on the United States despite efforts to diversify trade with other countries. With the ending of diplomatic relations, economic relations became the key for its links with the United States.1541

1536 Hu, “Taiwan’s Geopolitics”, 37.

1537 Taylor, The Generalissimo’s Son, 379.

1538 Nathan and Ho, “Chiang Ching-kuo’s Decision for Political Reform”, 31-32.

1539 Nathan and Ho, “Chiang Ching-kuo’s Decisio for Political Reform”, 48-49.

1540 Cho-yun Hsu, “Historical Setting for the Rise of Chiang Ching-kuo” in Leng, ed., Chiang Ching-kuo’s Leadership, 17.

1541 Swaine and Mulvenon, Taiwan’s Foreign and Defense Policies, 134; Tucker, Hong Kong, Taiwan, 168.

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Between 1975 and 1985 the percentage of its exports to the United States increased from 34.3% to 48.1%.1542 Thus the American market accounted for nearly half of Taiwan’s exports in the mid-1980s, playing an important role in its positive balance of trade and its continued economic miracle.

Figure 5.3 Taiwan’s major export partners, 1985

Source: Plotted based on data from Taiwan Statistical Data Book, Council for Economic Planning and Development, Executive Yuan, ROC (Taiwan) (Taipei, 2007).

1542 The total value of exports also jumped dramatically from $5,309 million in 1975 to $30,726 million in 1985. Taiwan Statistical Yearbook, 2007.

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Figure 5. 4 Taiwan’s trade balance with the US

Source: Plotted based on data from Taiwan Statistical Data Book, Council for Economic Planning and Development, Executive Yuan, ROC (Taiwan) (Taipei, 2007).

Thus any decline in trade with the United States, or in the political-military commitment would significantly impact Taiwan at a time when it was already experiencing major political changes.

Hence the leadership may have been motivated to undertake Restraint 3 based on these considerations.

Table 5.9 Summary of Taiwan’s restraint 3 (Rollback) 1988

Causes of restraint Present? Resource Constraints: Techological No Did sanctions impose significant resource constraints on NW Financial No program? Motivational Changes: Security Yes Did sanctions induce motivational changes in NW program? Domestic Politics Yes

Prestige No

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Continued Restraint 1988-2010

Since abandoning its plutonium reprocessing efforts and shutting down the TRR in 1988,

Taiwan continues to uphold its nonproliferation commitment made to the United States. At least in public knowledge, it has not renewed any efforts relating to nuclear weapons capability. In

1998 and 2000 it repeated its commitment not to develop or acquire nuclear weapons.1543

Taiwan’s nuclear restraint is especially significant since, despite having an advanced nuclear power program, it does not posses latent nuclear weapons capability -- Taiwan does not have the ability to reprocess plutonium or enrich uranium.1544

The PRC’s military modernization in recent years in terms of upgrading both its conventional and nuclear capability could create new incentives for another nuclear weapons effort by Taiwan.1545 This is coupled with uncertainly about the US commitment to Taiwan, which is based solely on the need to display US resolve rather than on any geopolitical urgency.

After the PRC tested six missiles within ninety miles of Taiwan in 1995, ROC President Lee

Teng-hui stated that perhaps Taiwan should reconsider its nuclear weapons effort.

Despite such emerging motives for renewing the nuclear weapons program, Taiwan will likely be dissuaded from doing so due to the following considerations. First, hostility with the

PRC is not as severe as in first few decades of the ROC on Taiwan. At that time the threat was a remnant of the Chinese civil war, with the KMT refusing to accept defeat. Since the 1970s,

1543 Christopher W. Hughes, “North Korea’s Nuclear Weapons: Implications for the Nuclear Ambitions of Japan, South Korea, and Taiwan”, Asia Policy, 3 no. 98-99 (2007), 99; Bullard and Yuan, “Taiwan”, 190.

1544 Togzhan Kassenova, “Global Non-Proliferation and the Taiwan Dilemma”, Global Asia, March 22, 2012 (Washington, D.C.: Carnegie Endowment for International Peace), accessed October 5, 2012, http://carnegieendowment.org/2012/03/22/global-non-proliferation-and-taiwan-dilemma/a5gh; Bullard and Yuan, “Taiwan”, 188-191. However, Taiwan continues to be reluctant to reveal past weapons efforts, which could conceivably be due to a desire to allow reconstituting the effort in the future.

1545 Hughes, “North Korea’s Nuclear Weapons”, 98-99.

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Taiwan has accepted its vastly reduced diplomatic status as a non-state.1546 Since the 1990s, trade across the Taiwan Strait has increased tremendously, with the PRC becoming Taiwan’s largest trade partner.1547 Second, Taiwan may be dissuaded by the concern that any open nuclearization would alienate the United States and lead to its abandonment. A consideration of possible US economic sanctions might factor into this calculation.1548 Third, democratization in

Taiwan has been associated with the emergence of popular opposition to nuclear power and nuclear weapons. And finally, it would be near impossible for Taiwan to pursue a nuclear weapons program in secret without being detected by the United States or the PRC. This arises from its dependence on these countries as well as from democratization, which makes it difficult to initiate such secret programs.1549

Conclusion

The chapter has shown that Taiwan’s nuclear weapons effort ended conclusively by the late 1980s under American pressure. US economic sanctions, which were largely threatened but not imposed, had a significant impact on ROC decision-making mainly by affecting motivations for nuclear weapons. Sanctions persuaded the leadership to abandon the nuclear weapons program because of Taiwan’s increasing dependence on the United States in the 1970s and

1980s. They did not deny resources for the weapons program since they were generally not imposed. However American pressure on European suppliers was critical in limiting the availability of nuclear technology to Taiwan.

1546 Having been expelled from the UN and therefore ceasing to be member-state of the IAEA, the Agency accords Taiwan a unique position, referring to it as ‘Taiwan, China’.

1547 Bullard and Yuan, “Taiwan”, 191.

1548 Hughes, “North Korea’s Nuclear Weapons”, 101.

1549 Bullard and Yuan, “Taiwan”, 190.

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It appears that Chiang Ching-kuo -- the ultimate leader during rollback decisions in

Restraint 2 and Restraint 31550 -- continued to desire nuclear weapons capability. He was nevertheless motivated to undertake restraint for the purpose of retaining American support.

This explains Taiwan’s repeated attempts to renew the program after slowing it down. The weapons program ultimately appears to have ended conclusively with the death of Chiang

Ching-kuo in 1988. The analysis therefore shows the successful impact of American pressure on a dependent ally, as well as the role of national leaders in nuclear decision-making.

Table 5.10 Taiwan’s nuclear rollback

Did sanctions impose significant Did Sanction induce Restraint Resource Constraints on motivational changes in NW program? NW program? Restraint 1: Slow No Yes (1973)

Restraint 2: Stop, No Yes Rollback (1977-1978)

Restraint 3: Rollback No (speculative) Yes (speculative) (1988)

1550 CCK was also likely influential during Restraint 1 in 1973, although his father was President at the time.

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CHAPTER 6

LIBYA

In December 2003 Libya dramatically announced that it was dismantling its programs for developing nuclear weapons, chemical weapons, and ballistic missiles. It immediately followed through and in less than a year the United States declared that it had verified Libya’s WMD dismantlement.1 This chapter argues that sanctions were important in convincing Libya’s leader

Qaddafi to give up the nuclear weapons program. Sanctions played such a persuasive role both by heightening threat perceptions and by generating the expectation that restraint would reduce such threats. The analysis also assesses the impact of sanctions in the slowing of the nuclear weapons program in the 1980s, concluding that they were relatively unimportant. Instead, the slow growth at that time is primarily attributed to difficulties obtaining nuclear technology due to Qaddafi’s reputation as a radical leader.

The chapter begins with a brief history of Libya and its relations with the United States. It discusses the motivations behind the nuclear program and charts its path, classifying two phases of weapons pursuit and two phases of restraint. It then studies each of these phases and the role of sanctions therein. Since periods of nuclear weapons pursuit entailed some setbacks, the analysis assesses whether sanctions slowed the pace of nuclear pursuit. In assessing the nuclear rollback decision of 2003, the chapter finds that although sanctions contributed to some resource denial, their principal impact arose from their role in conveying security and political threats to the regime, thus persuading restraint.

1 Paula DeSutter, “Completion of Verification Work in Libya”, Testimony before the Subcommittee on International Terrorism, Nonproliferation and Human Rights, September 22, 2004, http://www.state.gov/t/vci/rls/rm/2004/37220.htm

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History

Libya’s Colonel Muammar Qaddafi came to power in a bloodless military coup in 1969 overthrowing King Idris al-Sanusi. One of the first moves of the new regime was to close the

American airbase just outside Tripoli. The government aimed to distance itself from Libya’s colonial heritage2 and project the country as leader of the Arab world. It supported liberation movements and terrorist activities abroad including the IRA and radical Palestinian groups. The regime based itself on the principles of pan-Arabism, anti-imperialism, and socialism drawing loosely from Islamic principles.

Relations with the United States began deteriorating in the 1970s with the closing of the

American airbase and emerging military clashes in the Gulf of Sidra, where the United States claimed its right to navigate while Libya considered it its territorial waters.3 In the aftermath of the Islamic Revolution in Iran, Libyan protesters stormed and burned the American embassy in

Tripoli. The United States placed Libya on its list of state sponsors of terrorism in 1979 and shut down its embassy in 1980.4 Military encounters over the Gulf of Sidra continued including the shooting down of two Libyan aircraft in 1981, and further clashes in 1983 and 1986.5 The

Reagan administration imposed a comprehensive trade embargo against Libya in 1986 and

2 Italian forces, which had arrived in 1911, controlled the Libyan provinces by the 1930s. After World War II Libya was governed jointly by the French and the British. The UN formally granted independence to Libya in 1951, establishing the socio-religious leader Sayyid Idris al-Sanusi as king.

3 From the 1970s Libya also came to be associated with numerous terrorist activities including the killing of Israeli athletes at the 1972 Munich Olympics and the assassination of the American Ambassador to Sudan in 1973. Bruce W. Jentleson and Christopher A. Whytock , “Who Won Libya? The Force-Diplomacy Debate and Its Implications for Theory and Policy”, International Security, 30 no. 3 (2005/06); Tim Niblock, Pariah States and Sanctions in the Middle East: Iraq, Libya, Sudan (Boulder, CO: Lynne Rienner Publishers, 2001), 23; O’Sullivan, Shrewd Sanctions, 175.

4 Christopher M. Blanchard, “Libya”, CRS Issue Brief for Congress, June 14, 2005.

5 Another terrorist incident attributed to Libya was bomb explosions at the Rome and Vienna airports in 1985 killing 20 including 5 Americans, and wounding 110. Early in 1986 the United States moved elements of the Sixth Fleet into the Gulf of Sidra partly to weaken Qaddafi. Niblock, Pariah States, 31.

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launched covert activities to dislodge Qaddafi.6 Following suspicions of Libyan involvement in a bomb explosion at a Berlin club frequented by American servicemen,7 in 1986 US bombers attacked targets around Tripoli and Benghazi, reportedly killing Qaddafi’s infant daughter.

The biggest terrorist incident that came to dominate Libya’s foreign relations was the

1988 bombing of a Pan Am flight over Scotland, killing 279. In late 1991 a US court indicted two Libyan officials in the Lockerbie affair – named for the place where the aircraft crashed.

Libya was also charged with bombing a French UTA aircraft over Niger in 1989. These events led to the imposition of UN sanctions beginning in 1992.

In the late 1980s and early 1990s the United States also accused Libya of pursuing an active chemical weapons program, threatening military strikes on the facilities. Concerns about its nuclear program were not as serious since it was not believed to be very advanced.

Nuclear Program

Libya’s nuclear program began under its charismatic leader Qaddafi in the early 1970s.

Several attempts to obtain nuclear technology failed due to Qaddafi’s unfavorable international reputation as a radical, unpredictable leader. Moreover, it was widely suspected that Qaddafi was seeking nuclear weapons capability. The program was modest until the mid-1990s, largely based around a nuclear research center established with Soviet assistance. Unknown to the outside world, in the 1990s and early 2000s Libya obtained some centrifuge technology and even a weapons design from the A Q Khan network. The program was characterized as

“nascent” since Libya neither produced the feed material for enrichment, nor operated its sole

6Yahia H. Zoubir “The United States and Libya: From Confrontation to Normalization”, Middle East Policy, XIII no. 2 (2006), 49.

7 The explosion killed 3 and wounded 230 (State Department 2008).

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centrifuge cascade with nuclear material.8 Nevertheless, its acquisitions of centrifuges as well as nuclear material from the network meant that it was poised to develop the capability to enrich uranium, a critical step in nuclear weapons capability. The nuclear program can be divided into an initial period of weapons pursuit, a phase of restraint due to difficulties obtaining technology, further pursuit, and finally, the complete dismantlement of the weapons program.

Table 6.1 Libya’s nuclear program

Years Nuclear Weapons Pursuit/ Restraint 1970- mid Nuclear Pursuit (1) 1980s Mid 1980s- Nuclear Restraint 1 (Slow) 1995 1995-2002 Nuclear Pursuit (2) 2002-2009 Nuclear Restraint 2 (Slow and Rollback)

Libya’s quest for a nuclear weapon began with an approach to Egypt’s Gamel Abdel

Nasser to help buy it from China in 1970.9 As Nasser predicted, China refused to sell nuclear weapons.10 The failure of the effort to directly acquire the bomb led Libya to set up a domestic nuclear infrastructure. In 1973 Qaddafi established the Atomic Energy Establishment, apparently for the purpose of developing peaceful uses of nuclear energy.11 Libya eventually

8 Mohammed ElBaradei, The Age of Deception: Nuclear Diplomacy in Treacherous Timesi (New York: Metropolitan Books, 2011), 151, 155.

9 Major Abdul Salam Jalloud, vice chairman of the Revolutionary Command Council reportedly met with Egyptian President Nasser in Cairo and expressed Libyan desire to acquire a nuclear weapon. Weissman and Krosney, Islamic Bomb, 56. Libyan officials may also have discussed funding the Egyptian nuclear program in exchange for technology. Bowen, “Libya and nuclear proliferation: stepping back from the brink”, Adelphi Paper (London: Routledge, 2006), 28. Egyptian nuclear scientists worked in Libya in the 1970s. Mark Fitzpatrick, ed., Nuclear Black Markets: Pakistan, A. Q. Khan and the Rise of Proliferation Networks. A Net Assessment (London: International Institute for Strategic Studies, 2007), 57. Libya reportedly sought to purchase nuclear weapons from China twice in the 1970s. Richelson, Spying on the Bomb, 325, 337.

10 Richelson, Spying on the Bomb, 325.

11 In 1981 this agency together with the Tajoura Nuclear Research Center established by the Soviets, was subsumed under a larger organization called the Secretariat of Atomic Energy. International Atomic energy Agency, 276

approached several countries in the effort to acquire nuclear technology, including Argentina,12

Belgium,13 Brazil, Canada, China, Finland, France,14 Germany, India, Italy, Pakistan, Sweden, and the United States.15 These attempts largely failed in the 1970s and 1980s because of proliferation concerns coupled with the unsavory reputation of Muammar Qaddafi.16

During this time Qaddafi repeatedly stated that Libya would soon become a nuclear power.17 The civilian program was apparently driven by an underlying interest in nuclear weapons due to the perceived security and prestige benefits from possessing them. Although

Libya lacked the traditional security dilemmas that have historically resulted in nuclear proliferation,18 the leadership seemed to believe that the nuclear program would help deter

Implementation of the NPT Safeguards Agreement in the Socialist People’s Libyan Arab Jamahiriya, Report by the IAEA Director General, September 12, 2008, GOV/2008/39, 3.

12 In 1974 Libya signed an agreement with Argentina to obtain equipment and training for uranium extraction and purification. It also tried to acquire a research reactor from Argentina. Spector, New Nuclear Nations.

13 The Libyan government negotiated extensively with Belgian firms from the early 1970s, obtaining a basic design for a uranium conversion facility in 1982. International Atomic energy Agency, Implementation of the NPT Safeguards Agreement in the Socialist People’s Libyan Arab Jamahiriya, Report by the IAEA Director General, September 12, 2008, GOV/2008/39. However the effort to acquire an entire uranium conversion facility from Belgonucleaire failed due to American pressure on Belgium. Nuclear Programmes in the Middle East: In the shadow of Iran (London: International Institute for Strategic Studies, 2008), 99, accessed April 27, 2010, http://www.iiss.org/publications/strategic_dossiers/nuclear-programmes-in-the-middle-east-in-the-shadow-of- iran/read-the-dossier

14 Libya tried to buy twenty large calutrons (for EMIS enrichment) from the French firm Thompson-CSF in 1973, which was turned down by the French Atomic Energy Commission due to proliferation concerns. Richelson, Spying on the Bomb, 325; Nuclear Programmes in the Middle East, 98.

15 Libya attempted to obtain a nuclear reactor from an American firm in the 1970s, but was denied export licenses. Richelson, Spying on the Bomb, 326.

16 Nuclear Programmes in the Middle East, 98.

17 Maurizio Cremasco, “Libya” in Harald Muller, ed., A European Nonproliferation Policy (Oxford: Clarendon Press, 1987), footnote 2.

18 Solingen, Nuclear Logics, 214-216. Qaddafi himself appeared to acknowledge this when he stated that Pakistan had “a reason to build a bomb because India has one.” Youssef M. Ibrahim, “Libya and the World. Interview with Qaddafi”, Survival, 22 no. 2 (1981), 82.

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foreign attack as well as project Libya as a modern nation and regional leader.19 Libya established links with Pakistan, reportedly reaching an agreement in 1973.20 According to this,

Libyan finances would fund the Pakistani nuclear program -- providing between $100 million and $500 million -- in return for nuclear weapons technology and material. Libya also reportedly agreed to financially assist Pakistan’s planned purchase of a French reprocessing plant in exchange for some of the plutonium it produced.21 However Qaddafi felt

“shortchanged” when weapons technology did not materialize, and the Pakistanis were hesitant to build the projects in Libya.22 The relationship largely ended when Pakistani Prime Minister

Bhutto was overthrown in a military coup in 1977.23

Libya imported large quantities of yellowcake from Niger between 1978 and 1981.24 Its military involvement in Chad over the disputed area of the Aouzou Strip beginning in 1973 is also attributed to the region’s presumed uranium deposits.25

Libya signed a nuclear trade pact with the Soviet Union in 1975 to receive a small research reactor and set up a research center. As pre-conditions for the cooperation, the Soviet

19 Cremasco, “Libya”, 278; Målfrid Braut-Hegghammer, “Libya’s Nuclear Turnaround: Perspectives from Tripoli”, Middle East Journal, 62 no. 1 (2008), 59-60.

20 Richelson, Spying on the Bomb, 325.

21 Bowen, “Libya and Nuclear Proliferation”, 30; Spector, Nuclear Proliferation Today.

22 Corera, Shopping for Bombs, 12.

23 Some assistance in the form of training scientific personnel continued for a few more years. Bowen, “Libya and Nuclear Proliferation”, 31.

24 . International Atomic energy Agency, Implementation of the NPT Safeguards Agreement in the Socialist People’s Libyan Arab Jamahiriya, Report by the IAEA Director General, September 12, 2008, GOV/2008/39, 4.

25 Solingen, Nuclear Logics, 213. Libyan claim to the Aouzou Strip on Chad’s northern frontier had begun during the reign of King Idris. However it took on a military dimension under Qaddafi, who supplied arms and money. The Libyan military moved its forces into the Aouzou Strip in 1973, No.ing 15,000 in Chad by 1980. Pollack, Arabs at War, 381. After major defeats in 1987, they withdrew permanently in 1994 following a ruling by the International Court of Justice (ICJ).

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Union required that Libya ratify the NPT26 and enter into a full-scope safeguards agreement with the IAEA.27 These conditions were fulfilled in 1975 and 1980 respectively. The Soviet

Union agreed to develop the Tajoura Nuclear Research Center (TNRC) involving a 10- megawatt light-water reactor, a 100-watt critical assembly, and related departments and laboratories.28 The reactor, called the IRT-1, started operating in 1981 and remained the central aspect of the nuclear program. It was a thermal swimming pool-type light water research reactor and normally operated at 5 MW despite a capacity for 10 megawatts.29 The Soviets supplied

80% enriched HEU fuel for the reactor. After the Soviet Union stopped assistance in 1991, local personnel operated the reactor with periodic interruptions.

The TNRC included a radiochemical laboratory for producing medical isotopes and a nuclear metallurgy laboratory.30 The radiochemical lab contained six hot cells and six chemical boxes, indicating a “limited reprocessing capability” – an important step to develop nuclear weapons using plutonium.31 In the 1980s Libya conducted plutonium separation experiments at the facility.32

26 Libya had already signed the NPT under King Idris in 1968.

27 Bowen, “Libya and Nuclear Proliferation”, 18.

28 International Atomic Energy Agency, Implementation of the NPT Safeguards Agreement of the Socialist People’s Libyan Arab Jamahiriya, February 20, 2004, GOV/2004/12.

29 Yana Feldman and Charles Mahaffey, “Libya”, Countries of nuclear strategic concern (SIPRI series, Undated), accessed March 10, 2010, http://www.sipri.org/research/disarmament/nuclear/researchissues/past_projects/issues_of_concern/libya

30 John Hart and Shannon N. Kile, “Libya’s renunciation of nuclear, biological and chemical weapons and ballistic missiles”, SIPRI Yearbook 2005 (Stockholm: SIPRI, 2005), 636.

31 Feldman and Mahaffey, “Libya”.

32 Nuclear Programmes in the Middle East, 98.

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Libya also tried to build a nuclear power capability for electricity generation and water desalination, negotiating with the Soviets for two 440-megawatt nuclear power reactors.33 In the early 1980s it signed several agreements and held discussions with the Soviets to develop the

TNRC. These did not come to fruition partly due to Soviet concerns about proliferation risks and partly due to Libya’s declining ability to pay for the reactors.34 Efforts to acquire a uranium conversion facility from the Soviets also failed; instead the Soviet Union provided about 39kg uranium hexafluoride after converting the yellowcake sent by Libya in the 1980s.35

The attempt to acquire a uranium conversion facility began at least by 1981, probably as part of the plan to set up nuclear power plants.36 In 1982 the Libyan government obtained a basic design for a uranium conversion facility from Belgian firms. However the efforts to obtain an entire uranium conversion facility from Belgonucleaire failed due to US pressure on

Belgium.37 Libya also ordered a pilot-scale uranium conversion facility, receiving a “modular

33 International Atomic Energy Agency, Implementation of the NPT Safeguards Agreement in the Socialist People’s Libyan Arab Jamahiriya, September 12, 2008, GOV/2008/39, 4. With industrialization under Qaddafi’s regime, Libya’s electricity and water supply needs expanded. The contamination of water supplies with seawater was becoming an important issue generating the interest in desalination. Libya thirsts for ‘fossil water’, BBC World Service, March 18, 2006, accessed April 23, 2012, http://news.bbc.co.uk/2/hi/science/nature/4814988.stm. The regime also planned to generate nuclear power by the mid-1990s. “Soviets draw back from helping Libyan programme”, Nuclear Engineering International, 32 no. 401 (1987). Libya never ended up receiving the planned power reactors apparently due to Soviet concerns about Libyan intentions. Spector, New Nuclear Nations, 155.

34 Nuclear Programmes in the Middle East, 99.

35 International Atomic Energy Agency, Implementation of the NPT Safeguards Agreement in the Socialist People’s Libyan Arab Jamahiriya, May 28, 2004, GOV/2004/33, Annex 1, 3.

36 In 1982 Libya even approached the IAEA for assistance in producing uranium fluoride. The Agency responded with a small project for training in fluoride chemistry in 1985. International Atomic Energy Agency, Implementation of the NPT Safeguards Agreement in the Socialist People’s Libyan Arab Jamahiriya, May 28, 2004, GOV/2004/33, Annex 1, 4.

37 Nuclear Programmes in the Middle East, 99.

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mobile” facility indirectly from Japan in 1986. Due to absent or incomplete instructions on assembling and operating it, the facility was partially assembled only in 1998.38

Weapons Program

Libya’s interest in nuclear weapons has oscillated over the years, giving the program an

“on-again, off-again” character.39 This is reflected in Qaddafi’s contradictory statements – he has stated both that nuclear weapons do not improve security and that they are essential for defense.40 The fluctuating nature of the weapons program was partly a response to the availability of financial resources and requisite technology. For example, the 1973 oil crisis appears to have spurred the program through increased revenues; and a 1995 decision to renew the program (discussed later) was partly due to the procurement opportunity afforded by the

Khan network.41 A fundamental characteristic of the Libyan nuclear program appears to have been the gap between the desire for nuclear weapons and the ability to develop them due to the limited indigenous scientific infrastructure as well as difficulties obtaining technology abroad.42

Until the mid-1980s the nuclear program was ostensibly for civilian purposes alone.

Nevertheless the regime clearly had an interest in nuclear weapons, as evinced by the attempts to directly acquire the weapons.43 The main motivations were deterring external attack and

38 International Atomic Energy Agency, Implementation of the NPT Safeguards Agreement in the Socialist People’s Libyan Arab Jamahiriya, May 28, 2004, GOV/2004/33, Annex 1, 5.

39 John Prados, “How Qaddafi Came Clean”, The Bulletin of Atomic Scientists, November/December, 32 (2005).

40 Bowen, “Libya and Nuclear Proliferation”, 18-19

41 Braut-Hegghammer, Nuclear Entrepreneurs, 102-104.

42 Bowen, “Libya and Nuclear Proliferation”, 44; Cremasco, “Libya”, 260; 264-265.

43 As stated previously, in the early 1970s Libya attempted to purchase a nuclear weapon from Egypt and China. It also had a standing offer of one million dollars in gold in exchange for an atomic bomb during the 1970s (Richelson 2006, 325). In 1981 Libya tried to get nuclear weapons on the black market through a former CIA employee Edwin Wilson (Spector 1988, 200-201). He is said to have offered Libya nuclear infrastructure through a Belgian contact, 281

promoting Arab prestige. Libya has always faced security threats due to its porous borders and sparse population,44 thus making national and regime security important priorities.45 These security concerns were the initial drivers of the nuclear program.46 Qaddafi also appears to have been interested in nuclear weapons as a means to project Libya as leader of the Arab world.

Libya’s isolation in the Arab-Israeli War of 1973, a humiliating disappointment to Qaddafi, likely made nuclear weapons more attractive.47 Believing that another Arab war with Israel was inevitable, Qaddafi sought to increase Libya’s military strength.48 Thus Israel was an important rationale for nuclear weapons due to both security and prestige considerations.49

including a research reactor, HEU, plutonium, and a nuclear warhead production facility. The Libyans apparently rejected the proposal because it was incomplete and impractical (IISS 2007, 57).

44 Under the Ottoman Empire from the 16th to the early 20th century, Libya was not a nation-state but a grouping of the provinces of Tripolitania, Cyrenaica, and the Fezzan. Support for the UN-appointed King Idris, who ruled from 1951 until Qaddafi’s revolution in 1969, was largely confined to the Cyrenaican region that he hailed from. Regional disparities, widespread poverty, and a sparse population meant that Libya was a weak state. Hence it faced security threats of a different nature from the neorealist view of the inter-state quest for power.

45 Bowen, “Libya and Nuclear Proliferation”, 19; Mary-Jane Deeb, Libya’s Foreign Policy in North Africa (Boulder: Westview Press, 1991), 15.

46 Braut-Hegghammer, “Libya’s Nuclear Turnaround”, 59.

47 Qaddafi had been pressing Egypt’s Sadat for a merger between their two countries, an eventuality that came to play just a couple of months before the October War, mainly in response to Libyan financial support to Egypt. Despite such a union, Qaddafi was not only isolated from the war planning, but even blocked from involvement once Egypt began to register losses (Sicker 1987, 54-55). In addition, the war highlighted the Arab world’s strategic imbalance with Israel, which placed its nuclear weapons on alert (Braut-Hegghammer 2010, 102-103).

48 Qaddafi was apparently seeking to “unnerve Israel” and to block the peace negotiations. Increasing Libya’s military capability was also a way to influence Egypt by generating fear and envy (Intelligence Memorandum: Libyan-Soviet Relations, June 25, 1975, Top Secret, CIA, page 8, National Security Archives College Park.)

49 Israel’s conventional and nuclear superiority appears to have been an important factor in the early nuclear program (Bowen 2006, 20-21). Libya often cited Israeli nuclear weapons capability as justification for its own nuclear program (CIA 2003; Braut-Hegghammer 2010, 60). This arose due to Israel’s own nuclear capability as well as Qaddafi’s view of the Arab-Israel problem in military terms (Braut-Hegghammer 2010, 97-98). In the mid-1980s Libya allegedly approached Iraq with a request to attack Israel’s nuclear complex (Spector 1985, 158).

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Nuclear weapons would also grant greater flexibility in foreign policy.50 Thus Qaddafi viewed nuclear weapons as an instrument for Libya’s security as well as Arab prestige. These varied motives can be summed up as the desire to meet the foreign policy goals of pan-Arabism, anti-imperialism, and national security.51 Nevertheless during this period Qaddafi emphasized that Libya was not seeking nuclear weapons.52 Hence, at least officially, the program was peaceful. Indeed the motivation for nuclear weapons may have waned slightly in the early 1980s with a shift in focus toward chemical weapons development.53

From the mid-1980s Libya began actively seeking fuel cycle capability, marking the effective start of its nuclear weapons program.54 It appears to have been driven by security concerns,55 which deepened with US airstrikes in 1986. The US attacks were in response to the bombing of a Berlin nightclub, killing two American servicemen and wounding 200.56 The

United States targeted political and military centers, including Qaddafi’s residence in Azizia barracks in Tripoli, killing his daughter. The aim was clearly to assassinate Qaddafi.57 The event appears to have significantly strengthened the security motive for nuclear weapons, which came

50 Braut-Hegghammer, Nuclear Entrepreneurs, 99-100; Cremasco, “Libya”, 277-278.

51 Cremasco, “Libya”, 276.

52 For example in 1981 he told Time: “I have nothing but scorn for the notion of an Islamic bomb.” Cremasco, “Libya”, footnote 3.

53 Prados, “How Qaddafi Came Clean”, 28.

54 International Atomic Energy Agency, Implementation of the NPT Safeguards Agreement in the Socialist People’s Libyan Arab Jamahiriya, September 12, 2008, GOV/2008/39, 6-7.

55 By the 1980s, Qaddafi’s attempts to project Libya as a regional leader failed to resonate with fellow Arabs, and hence the prestige motive for nuclear weapons weakened (Braut-Hegghammer 2008, 63-64).

56 The bombing occurred on 5 April 1986, and the United States conducted its air raid on 15-16 April 1986 (Whytock and Jentleson 2005/06, 58; State Department 2008).

57 Niblock, Pariah States, 31.

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to be seen as the deterrent to ensure regime and national security.58 In 1987-1988 Qaddafi repeatedly expressed interest in acquiring nuclear weapons.59 In the late 1980s then, security concerns about deterring another American attack, as well as continuing notions of Arab prestige, formed important justifications for the nuclear weapons program.

The nuclear weapons effort at this time was mainly based on plutonium reprocessing technology, the initial choice for nuclear weapons production.60 Between 1984 and 1990 Libya produced small uranium oxide and uranium metal targets at the TNRC, irradiating them in the

IRT-1 and then reprocessing them in the radiochemical laboratory (also at the TNRC) to separate plutonium.61 These activities were not reported to the IAEA until 2004. In the late

1980s Libya negotiated with an intermediary for a pilot reprocessing facility, receiving only incomplete information and equipment.62 Attempts to acquire a heavy water production facility in the late 1980s and early 1990s produced only generic documentation.63 In the early 1990s it reportedly sought to obtain nuclear technology and expertise following the collapse of the

Soviet Union.

58 Bowen, “Libya and Nuclear Proliferation”, 21-22; Braut-Hegghammer, Nuclear Entrepreneurs, 110-111; George Joffé, “Libya: Who Blinked and Why”, Current History, May (2004), 221. Drawing on interviews with Libyan officials, Braut-Hegghammer writes that deterring an American attack became an important motive for the nuclear program after the 1986 attacks. Braut-Hegghammer, “Libya’s Nuclear Turnaround”, 64.

59 Bowen, “Libya and Nuclear Proliferation”,18-19; Prados, “How Qaddafi Came Clean”, 28; Spector, Undeclared Bomb, 196.

60 Nuclear Programmes in the Middle East, 99.

61 Nuclear Programmes in the Middle East, 99. However since the IRT-1 was a small reactor, Libya could extract only limited quantities of plutonium. See IAEA Reports, February 20, 2004; May 28, 2004; and September 12, 2008.

62 IAEA Report, September 12, 2008, 6.

63 IAEA Report, September 12, 2008, 4.

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Libya also launched uranium enrichment activities in the early 1980s, hiring a German engineer to develop gas centrifuges. He apparently brought a centrifuge with him, but did not succeed in operating it or introducing uranium hexafluoride.64 In 1984 Libyan officials met A Q

Khan, who offered to sell centrifuge technology.65 However, Libya turned down the offer since it lacked sufficient industrial and scientific expertise for the technology.66 Contacts with the

Khan network were renewed between 1989 and 1991, when Libya concluded a deal to acquire centrifuges based on aluminum rotors, called L-1. Libya received a few centrifuge components and designs in January 1991, but subsequent supplies were interrupted by the UN sanctions imposed in 1992, after which the materials were in storage in Dubai.67 In any case, since complete centrifuges were not delivered, the Libyans felt that what they received was “not commensurate with what Libya had paid for it.68” Libya sought a pilot-scale uranium conversion facility in the early 1980s, receiving a “modular mobile” facility indirectly from

Japan in 1986. Due to absent or incomplete instructions on assembling and operating it, the facility was partially assembled only in 1998.69 It was never operated and thus never processed any uranium.70

64 IAEA Report, September 12, 2008, 5; Nuclear Programmes in the Middle East, 101. According to some reports Libya did have a single working centrifuge by the early 1990s, but did not introduce uranium hexafluoride. Fitzpatrick, ed., Nuclear Black Markets, 57.

65 The contact appears to have been born out of the failed Pakistani-Libyan connection of the 1970s, under which Qaddafi hoped for an “Islamic bomb”, or at least weapons technology, in return for financial support. Qaddafi was unhappy when this did not materialize. Albright, Peddling Peril, 116; Corera, Shopping for Bombs, 12.

66 IAEA Report, September 12, 2008, 5; Annex, 3.

67 IAEA Report, September 12, 2008, Annex, 3.

68 IAEA Report, September 12, 2008, 5.

69 IAEA Report, September 12, 2008, Annex 1, 5.

70 IAEA Report, May 28, 2004, 5.

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The nuclear weapons program made little progress in the 1980s mainly due to the general reluctance of international suppliers to provide nuclear technology. This was the result of the regime’s unfavorable reputation.71 The slump in oil prices in the mid-1980s also exacerbated existing economic problems, making it increasingly difficult to invest scarce resources in the program.72 Thus the two supply-side factors for the slow growth in the Libyan nuclear program until the 1990s were -- proliferation concerns among Western nations generated by Qaddafi’s unpredictable personality, and declining financial resources.73

Due to this slow progress, this analysis categorizes the nuclear weapons program as undergoing a phase of restraint from the mid-1980s to the mid-1990s. Although Libya had faced difficulties obtaining nuclear technology in the 1970s, it had not explicitly begun a weapons program at that time. However from the late 1980s the leadership found it frustrating that the nuclear weapons program was proceeding at a slow pace.74 This frustration at a time when

Libya was consciously seeking fuel cycle capability lends this period to be categorized as

Restraint 1.

Libya’s interest in possibly giving up its entire WMD programs in exchange for better relations with the United States allegedly began as early as 1992 with overtures to the George H

W Bush administration.75 The offer can be understood in the light of international developments at the time – after the imposition of comprehensive UN sanctions, the United States had brought

71 Nuclear Programmes in the Middle East, 98.

72 Braut-Hegghammer, Nuclear Entrepreneurs, 112.

73 Nuclear Programmes in the Middle East, 98-99.

74 Bowen, “Libya and Nuclear Proliferation”, 36.

75 Libya approached American officials to discuss possibly giving up its WMD programs as part of better relations with the United States. This is described in detail in the section on Restraint 1.

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to its knees the much stronger regime of Saddam Hussein in nearby Iraq; and in early 1992 the

UN was threatening to impose sanctions on Libya. The regime may have been attempting to escape the UN sanctions through nuclear reversal.76 The advance was rejected by the United

States probably because of the political costs of holding dialogue with a country held responsible for the Lockerbie bombing.77

Libya’s nuclear program made its most rapid advances in the late 1990s and early 2000s following a 1995 decision to launch a concerted nuclear weapons effort.78 Interest in renewing the program seems to have been driven by considerations of regime security. The ongoing saga of WMD dismantlement in Iraq, coupled with the 1992 imposition of UN sanctions on Libya may have signaled to Qaddafi that his regime was threatened by US hostility.79 Indeed the new nuclear effort – which was to focus on uranium enrichment using centrifuges80 – was to be primarily located outside the TNRC in order to remain hidden from the IAEA.81 The decision to revive the program also appears to have been facilitated by the availability of nuclear technology through the Khan network.82 In 1997 Libya started receiving P-1 centrifuges

(renamed L-1) and components for several more.83

76 Bowen, “Libya and Nuclear Proliferation”, 23.

77 Gary Hart, “My Secret Talks with Libya, and Why They Went Nowhere”, Washington Post, January 18, 2004.

78 IAEA Report, September 12, 2008, Annex, 3.

79 Braut-Hegghammer, “Libya’s Nuclear Turnaround”, 67.

80 Apparently Libya also attempted the plutonium route but failed to obtain assistance from Argentina, Russia, Bulgaria, and Japan (IISS 2007, 76).

81 Bowen, “Libya and Nuclear Proliferation”, 36; Nuclear Programmes in the Middle East, 101.

82 Nuclear Programmes in the Middle East, 101.

83 The Khan network planned to produce some of the specialized materials for centrifuges within Libya, for which it was seeking to set up a precision machine shop at Janzour. To this end, Libya obtained large amounts of maraging steel and high strength aluminum alloy. IAEA Report, February 20, 2004, 5-6.

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Unlike the Khan network’s supply of technology to Iran and North Korea, its deal with

Libya was likely to emerge its “most lucrative contract” as Libya was seeking a turnkey centrifuge program84 as well as equipment to manufacture further centrifuges.85 Around 1997

Libya received 20 pre-assembled P-1 centrifuges (renamed L-1) and components for another

200 centrifuges. However, the network did not deliver essential centrifuge components – aluminum rotors and ring magnets – apparently due to difficulties manufacturing them.86 Libya also received about 1.7 tons uranium hexafluoride from the A Q Khan network between late

2000 and early 2001.87

The centrifuge program was centered at Al Hashan on the outskirts of Tripoli. In 2000

Libya conducted its first successful test on a single completed centrifuge, followed by two high- speed tests two years later.88 From late 2000 Libya started installing 9-machine, 19-machine, and 64-machine L-1 centrifuge cascades, of which only the 9-machine cascade was operational by the time of the 2003 decision on rollback.89 In April 2002 the cascades90 were dismantled and

84 It was supposed to be a centrifuge plant where all parts were provided from outside, so that all Libya had to do was assemble it. David Albright, and Corey Hinderstein, “Libya’s Gas Centrifuge Procurement: Much Remains Undiscovered”, ISIS Reports (Washington, D.C.: Institute for Science and International Security), March 1, 2004, accessed March 10, 2010, http://isis-online.org/isis-reports/detail/libyas-gas-centrifuge-procurement-much- remains-undiscovered/.

85 Corera, Shopping for Bombs, 109.

86 Fitzpatrick, ed., Nuclear Black Markets, 77-78.

87 This was significantly less than the 20 tons it had ordered probably due to difficulties for the network in obtaining such large quantities. Fitzpatrick, ed., Nuclear Black Markets, 78; Nuclear Programmes in the Middle East, 101. The uranium hexafluoride was enriched to 1%, enough to produce one nuclear weapon. Corera, Shopping for Bombs, 120. In 2002 Libya imported some 16 kg uranium compounds from foreign intermediaries for use as laboratory standards. IAEA Report, September 12, 2008.

88 IAEA Report, May 28, 2004.

89 IAEA Report, September 12, 2008, 5.

90 By April 2002 the 9-machine cascade was completely installed with associated equipment and electrical connections; the 19-machine cascade had the first 10 rotors installed; and the 64-machine cascade was ready for installation . IAEA Report, February 20, 2004, 5.

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relocated to Al Fallah for security reasons – perhaps due to the buildup toward the Iraq war -- where they remained in storage boxes by the time of the 2003 decision to terminate the program.91 Libya has stated that it did not use nuclear material in any of the centrifuge tests.92

In 2000 the Khan network also supplied two of the advanced L-2 type centrifuge, which use the more efficient maraging steel rotors.93 Libya then ordered 10,000 L-2 machines plus all supporting equipment.94 The plan was to build a plant with about 5,000 to 6,000 centrifuges, producing about a hundred kilograms of weapons-grade uranium annually.95 Large numbers of

L-2 components started arriving in December 2002 but they did not form complete centrifuges due to the absence of rotating parts.96 Indeed some L-2 components were still in their original boxes when the IAEA visited Libya in 2004.97 Ultimately none of the centrifuge cascades was completed by December 2003 when Libya began dismantling its nuclear program.98 It is

91 IAEA Report, May 28, 2004, Annex 1, 6. It is not clear exactly why the centrifuge cascades were relocated. Ftizpatrick, ed., Nuclear Black Markets, 77-78. According to an IAEA report, Libya stated that the centrifuges were boxed and moved to Al Fallah “for security reasons.” IAEA Report, February 20, 2004, 5. As described later in the chapter, Libya’s threat perceptions from the United States significantly increased after 9/11. Qaddafi’s regime had already been the target of American strikes in 1986; after 9/11 the Bush administration talked of the need for ‘preemption’ against gathering threats, highlighting the nexus of terrorism and WMD proliferation. Since Libya had been accused of both, it had reason to be concerned about US intentions.

92 IAEA Report, September 12, 2008, 5.

93 Unlike the L-1 centrifuges that used aluminum rotors, L-2 centrifuges were based on maraging steel rotors, which were considered more efficient. The two L-2 centrifuges that were received were however not in ready working condition for the purposes of uranium enrichment. According to an IISS report, one L-2 centrifuge was not suitably designed for enrichment, and the other was not in ready working condition. Nuclear Programmes in the Middle East, 103.

94 IAEA Report, September 12, 2008.

95 Albright, Peddling Peril, 123.

96 Fitzpatrick, ed. Nuclear Black Markets, 78; IAEA Report, September 12, 2008.

97 Nuclear Programmes in the Middle East, 103.

98 IAEA Report, September 12, 2008.

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assessed that Libya was about three to four years from launching its ambitious centrifuge plant.99

In 1998 Libya partially assembled the uranium conversion facility, whose parts it had obtained indirectly from Japan.100 It conducted a cold testing in 2002 (i.e. without using uranium), after which it dismantled the facility and moved it to a different location for “security and safety”, again probably due to the buildup to the 2003 Iraq war.101 In any case it appears that the facility could not produce uranium hexafluoride suitable for enrichment.102 The plant was never operated.

In late 2001 or early 2002 Libya also received from the Khan network information on nuclear weapons design and manufacturing, including handwritten engineering drawings on nuclear weapons components.103 The design was for a 10-kiloton implosion devise based on a

Chinese design in the late 1960s104, and was unlikely to fit Libya’s SCUD missiles.105 In fact, the agency tasked with the nuclear weapons program (the National Board for Scientific Research or

NBSR) appeared to have no links with the agency for missile development (Central Organization

99 Albright, Peddling Peril, 149.

100 The facility was apparently delivered without adequate instructions for assembly and operation. IAEA Report, May 28, 2004, Annex 1, 5.

101 IAEA Report, May 28, 2004, Annex 1, 4.

102 Nuclear Programmes in the Middle East, 99.

103 IAEA Report, February 20, 2004, 6.

104 The Khan network accessed the design since it had been given to Pakistan. Nuclear Programmes in the Middle East, 103.

105 Sharon A. Squassoni and Andrew Feickert, “Disarming Libya: Weapons of Mass Destruction”, CRS Report for Congress, April 22, 2004, 4.

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for Electronic Research).106 Libya also did not seem to have any facility devoted to weapons components and manufacturing.107 Nevertheless by December 2003 Libya had “procured most of the technical pieces of the nuclear-weapon jigsaw.”108 The following table sums the key aspects of the program until 2002.

Table 6.2 Details of Libya’s nuclear weapons program

Activity Year Fissile Material Uranium ore concentrate (2,263 tons) from Niger 1978-1981 Uranium hexafluoride (39 kg) from Soviet Union 1985 Uranium hexafluoride (1.7 tons) from Khan network 2000-01 Imported uranium compounds (16 kg) 2002

Uranium Conversion Facility Received parts indirectly from Japan 1986 Partial assembly of the facility 1998 Cold testing; moved to different location; never operated 2002

Reactor Tajoura Research Reactor called IRT-1 is a 10 MW reactor usually operating at 5 Started MW, running on Soviet-supplied 80% HEU fuel operating 1981

Uranium Enrichment (Centrifuge Program) German expert worked at TNRC 1982-1992 Major deal with Khan network, Libya receives 20 pre-assembled P-1 centrifuges 1995/97 and components for 200 P-1 centrifuges

Single P-1 centrifuge successfully tested at Al-Hashan, Tripoli 2000 More centrifuge tests, and start installing P-1 centrifuge cascades at Al-Hashan; 2002 no nuclear material introduced into centrifuges – no enrichment. Relocate centrifuge facility to Al-Fallah 2002

Receives two P-2 centrifuges 2000

106 IAEA Report, May 28, 2004. Libya had acquired some Scud-B missiles from the Soviet Union in the 1970s, reportedly with a range significantly less than the presumed 950 kilometers. Cirincione et al, Deadly Arsenals (2005) 324. Its indigenous missile development program since the late 1970s attempted to develop two missiles with limited success – the Ittisallat, with a range of 50 miles, and the Al-Fatah, with a range of over 200 miles. Spector and Smith 1990, Nuclear Ambitions, 180. Other delivery systems include Tu-22 bombers and Su-24 long range strike fighters, but they either had limited operational ability or limited refueling capacity. It is thus believed that Libya possessed no aircraft for delivering nuclear weapons at the time of Qaddafi’s decision to end the program.

107 Nuclear Programmes in the Middle East.

108 Bowen, “Libya and Nuclear Proliferation”, 44.

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Receives P-2 centrifuge parts, but missing components; not all P-2 centrifuge 2002 parts unpacked by 2003

Plutonium Reprocessing Produced small uranium targets at TNRC, irradiated them at IRT-1, and extracted 1984-1990 small amounts of plutonium at the radiochemical lab at TNRC

Weapons Design Received design for 10 kiloton implosion nuclear device 2001/02

While the nuclear program was making significant progress in the late 1990s, the regime also made overtures to give up WMD programs in exchange for normalizing relations with the

United States.109 This appeared to be connected with the surrender of the Lockerbie suspects in

April 1999, a major turning point for Libya’s international relations. Assistant Secretary of State for Near East Affairs Martin Indyk and Bruce Reidel from the NSC reportedly met with Libyan intelligence chief Musa Kusa in 1999 in Geneva, when the Libyans offered to end the chemical weapons program in exchange for lifting US sanctions.110 The focus of the discussion was limited to the chemical weapons program since this was the main US concern on Libyan

WMD.111 Indeed it is uncertain if the Libyans intended to give up the nuclear program. In any case, the offer was rejected as the United States was more concerned about resolving Lockerbie, and Libya’s WMD programs were not considered serious threats to US security.112

109 The main US concern on Libyan WMD related to chemical weapons. Since the late 1980s, the United States had been accusing Libya of developing chemical weapons. In response to American threats to attack the facility, Libya closed down the Rabta chemical weapons facility in 1990 (Tucker 2009, 372). In the mid-1990s the United States became concerned about another plant under construction at Tarhuna, said to be the world’s largest chemical weapons plant (Cirincione et al 2005, 323).

110 Corera, Shopping for Bombs, 178-179.

111 Martin S. Indyk, “How Bush’s Doctrine of Pre-emption was Ambushed by Reality”, The Age (Australia), March 26, 2004.

112 Martin S. Indyk, “The Iraq war did not force Gadaffi’s hand”, Financial Times (London), March 9, 2004.

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On December 19, 2003 Libya made the surprising announcement that it was ending its nuclear and chemical weapons programs, and destroying ballistic missiles exceeding the range stipulated by the Missile Technology Control Regime (i.e. 300 km). It accepted international inspection to verify these actions. Some nine months before the announcement, Libyan officials had approached British and American intelligence officers to discuss WMD reversal in return for normalization. The decision on nuclear rollback was the culmination of a series of secret talks since March 2003.

Libya’s nuclear rollback was quickly implemented in the months following the declaration. The Additional Protocol -- which grants authority to the IAEA to conduct more rigorous inspections at undeclared nuclear facilities -- was accepted in practice from December

2003 before its official signing in March 2004. Since that time, Libya gave the IAEA

“unrestricted and prompt access, beyond that required” under its commitments.113 The US government undertook a three-phased approach to ensure the elimination of all WMD and missile programs, starting with the most proliferation-sensitive materials. In the first phase in

January 2004, the critical aspects of the nuclear program were removed; during the second phase in February-March, chemical munitions were destroyed and centrifuge components as well as missile parts and equipment were removed. Russia removed from Libya 13 kg of HEU fuel enriched to 80 % that the Soviet Union had supplied in the 1980s.114 The final phase sought to verify the completion of Libyan disarmament and in September 2004 the US Department of

113 IAEA Report, September 12, 2008, 6.

114 Squassoni and Feickert, “Disarming Libya”, 5.

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State announced the verification of Libya’s dismantlement of its WMD and MTCR-class missile programs with “reasonable certainty.”115

Under an agreement signed between Libya, Russia, and the IAEA in February 2004, all

HEU fuel was to be transferred to Russia.116 Most of this was completed by March, and the remaining three kilograms of fresh HEU were finally shipped to Russia in July 2006, leaving no more fresh HEU fuel in Libya.117 The documents showing weapons designs were also flown out and in US custody.118 All in all, more than 1,000 tons WMD-related components and five

SCUD missiles were removed from Libya.119 After temporarily obstructing the removal of the last remaining HEU120 allegedly due to limited benefits from reversal,121 the “successful

115 Paula DeSutter, “Completion of Verification Work in Libya”, Testimony before the Subcommittee on International Terrorism, Nonproliferation and Human Rights, September 22, 2004, http://www.state.gov/t/vci/rls/rm/2004/37220.htm

116 IAEA Report, May 28, 2004.

117 In October 2005 Libya signed a contract with a Russian firm to provide LEU fuel for the IRT-1 in the effort to convert the reactor to run on LEU rather than HEU. Peter Crail, “Chronology of Libya’s Disarmament and Relations with the United States”, Arms Control Today, accessed September 8, 2011, http://www.armscontrol.org/factsheets/LibyaChronology.

118 Paula DeSutter, “US Government’s Assistance to Libya in the Elimination of Its Weapons of Mass Destruction (WMD)”, Testimony by the Assistant Secretary for Verification and Compliance before the Senate Foreign Relations Committee, February 26, 2004.

119 Wade Boese, “US Points to Libya as Disarmament Model”, Arms Control Today, 34 no. 3 (2004).

120 Although all the fresh HEU fuel had already been removed, there still remained in Libya about 5.2 kg HEU in the spent fuel of the IRT-1. Crail, “Chronology”.

121 Qaddafi was apparently unhappy about the limited benefits he received from the United States, and about not being allowed to set up his tent in New York when he arrived for the UN General Assembly in September 2009. Cable from US Embassy, Tripoli to Secretary of State, Washington DC, “Libyans Seek Renewed Commitment from US in Return for Progress on HEU Shipment”, November 30, 2009, Secret/Noforn, Tripoli 000941; Wikileaks, accessed September 8, 2011; “Diplomatic cables: Gaddafi risked nuclear disaster after UN slight”, Guardian, December 3, 2010.

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completion of Libya’s commitments to dismantle its nuclear weapons programs”122 was achieved in December 2009. The following table shows the main elements of Restraint 2.

Table 6.3 Libya’s Restraint 2 (slow and rollback) 2002-09

Date Activity 2002 Libya boxes and relocates centrifuge and uranium conversion facilities; they are never restarted. December 2003 Qaddafi makes announcement on nuclear rollback; the program is halted.

January 2004 The bulk of rollback is accomplished with the removal of: * all centrifuges and related equipment * 39 kg of uranium hexafluoride converted by Russia * documents showing weapons designs

February-March Removal of: 2004 * further centrifuge components * 13 kg of Soviet-supplied HEU fuel.

July 2006 Removal of 3 kg of fresh HEU fuel

December 2009 Last remaining HEU (5.2 kg) in the spent fuel is sent to Russia

Thus Qaddafi’s surprise announcement of December 2003 led to the complete termination of

Libya’s nuclear program, marking the critical phase of nuclear restraint in Libya. The remainder of the chapter analyzes each phase in the nuclear program, assessing the role of sanctions.

Nuclear Pursuit (1) 1970- mid 1980s

In the first several years after coming to power Qaddafi launched the effort to set up a nuclear infrastructure by acquiring key components from abroad. By the mid-1980s Libya had a nuclear research center, the hub of which was a 10 MW research reactor. It also began early efforts at obtaining fuel cycle capability -- initiating efforts at uranium enrichment, plutonium reprocessing, and seeking to obtain a uranium conversion facility.

122 Cable from US Embassy, Tripoli to Secretary of State, Washington DC, “Final HEU Shipment Departs Libya”, 21 December 2009, Secret/Noform, Tripoli 001025; Wikileaks, accessed September 8, 2011.

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The start of the nuclear program in the 1970s overlapped with some US sanctions on

Libya. The sanctions were significantly strengthened by the mid-1980s. This section considers the impact of the sanctions, assessing whether nuclear pursuit in this period would have been faster without the US sanctions.

Sanctions possibly affecting Pursuit 1

US unilateral sanctions were imposed on Libya in response to its support of terrorist activities,123 starting with a 1973 bar on the sale of major military goods.124 In 1979 the United

States placed Libya on its newly formed list of state sponsors of terrorism, prohibiting the export of military and dual-use items and other US assistance. It strengthened nuclear export controls in 1983 and barred the training of Libyans in nuclear sciences at American universities.125

More general sanctions began in 1982 with a ban on imports of Libyan crude oil, again in response to Libyan support of terrorism.126 The United States also stopped the export of oil and gas technologies to Libya. Three years later the import of refined petroleum products was prohibited. The following table sums up the sanctions in this period.

Table 6.4 US Sanctions against Libya during Pursuit (1)

Date US Sanctions on Libya

1973 US bans the sale of major military goods to Libya

123 Libya was allegedly involved in the killing of Israeli athletes at the Munich Olympics in 1972; supported radical Palestinian groups; funded the IRA; and was behind the killing of the American Ambassador to Sudan in 1973. O’Sullivan, Shrewd Sanctions, 175.

124 The US government refused to deliver eight Lockheed C-130 Hercules planes after Libya paid for it; and in 1975 it cancelled a planned sale of an air defense system. Niblock, Pariah States, 27.

125 Spector, New Nuclear Nations, 156.

126 O’Sullivan, Shrewd Sanctions, 176.

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1978 US suspends export licenses for dual-use material

September 1979 Libya is named on the newly formed list of state sponsors of terrorism

May 1981 US closes Libyan diplomatic mission in Wahington DC

October 1981 US limits export of small aircraft, helicopters, aircraft parts, and avionics to Libya

March 1982 US embargoes imports of Libyan crude oil and bans export of sophisticated oil and gas equipment and technology

November 1985 US embargoes imports of Libyan refined petroleum products

Libya also faced sanctions from Europe in the 1980s. The United States had been attempting to persuade European countries to impose sanctions but succeeded only to a limited extent due to their extensive economic links with Libya.127 In 1984 Britain imposed an oil embargo and severed diplomatic links after a police officer was killed by shots fired from the

Libyan embassy in London.

Sanctions and Pursuit (1)

This section considers whether these sanctions hampered Libya’s nuclear program in any way during Pursuit (1). Such an assessment is based on the possible resource constraints and motivational changes that may have been induced by sanctions. It is shown that the sanctions did not significantly hamper the program through either route.

(a) Resource Constraints

Technology Denial

Did sanctions restrict nuclear technology to Libya during Pursuit (1)? This is unlikely since the main sanctions on Libya at this time were imposed by the United States, which was in

127 Lisa Anderson, “Libya’s Qaddafi: Still in Command?”, Current History, 86 no. 517 (1987), 66.

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any case not supplying nuclear technology to Libya. As described below, the numerous instances of technology denial since the 1970s were largely the result of suppliers’ suspicion of

Libyan intentions rather than due to sanctions.128 Such suspicions arose from the fact that although officially disavowing nuclear weapons, Qaddafi often indicated a desire for them. For example in 1975 he stated that Libya would soon be able to buy an atom bomb.129

In 1975 the United States denied export licenses to an American firm for the supply of a research reactor to Libya.130 The United States may have been motivated by the ongoing clashes with the Qaddafi regime. The denial cannot be attributed to US sanctions since these did not ban the sale of dual-use technology until 1978. Libya tried to buy twenty large calutrons (for EMIS enrichment) from the French firm Thompson-CSF in 1973, which was turned down by the

French Atomic Energy Commission due to proliferation concerns.131 France agreed to supply a large 600-megwatt pressurized-water nuclear reactor during a visit by French Prime Minister

Jacques Chirac to Tripoli in 1975. However the agreement was cancelled apparently under international pressure on France.132

Nuclear cooperation with Pakistan ended in 1979 with the execution of Pakistani PM

Bhutto and not due to any sanctions. In the late 1970s Libya also negotiated with India for nuclear technology, apparently seeking plutonium reprocessing technology. In 1979 India limited nuclear cooperation to “strictly innocuous areas”, presumably motivated by wariness of

128 Nuclear Programmes in the Middle East, 98.

129 Weissman and Krosney, Islamic Bomb, 53

130 Libya was negotiating with the American firm General Atomics for a research reactor and enriched fuel. Bowen, “Libya and Nuclear Proliferation”, 28.

131 Nuclear Programmes in the Middle East, 98; Richelson, Spying on the Bomb, 325.

132 Cremasco, “Libya”, 26; nti.org

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the Qaddafi regime and its nuclear cooperation with Pakistan.133 In the late 1970s Libya sought support from Argentina for prospecting, mining, and processing uranium, but received only some training for geologists.134 Discussions with the Soviets on two nuclear power reactors continued for about a decade from 1977 but eventually bore no fruit, again due to suspicions of

Libyan intentions.135

Libya received some assistance from the Belgian firms Belgatom and Belgonucleaire in the early 1980s for building up the Tajoura Nuclear Research Center (TNRC), architectural support for the planned nuclear power reactors, and assistance in developing indigenous uranium deposits.136 In 1984 Belgium announced that it was entering into a major nuclear agreement, which would include the sale of a plant for producing uranium tetrafluoride.137

However the deal was cancelled in 1985 due to American as well as European pressure on

Belgium based on suspicions of Libya’s intent to weaponize.138

Thus Pursuit (1) was marked by a strong reluctance among nuclear suppliers in providing technology to Libya. The main reason for this seems to have been suspicions of Libya’s intent to develop nuclear weapons as well as Qaddafi’s reputation as radical and unpredictable.139 Since the 1970s Qaddafi had made contradictory statements on the desirability of nuclear weapons as

133 Bowen, “Libya and Nuclear Proliferation”, 28; Spector, New Nuclear Nations, 154-155; Spector and Smith, Nuclear Ambitions, 176-177. Libya unsuccessfully attempted to elicit Indian support by suspending oil exports.

134 Bowen, “Libya and Nuclear Proliferation”, 27. Negotiations with Argentina for a research reactor stalled after a civilian government took office in 1983.

135 Spector and Smith, Nuclear Ambitions, 176-177.

136 Cremasco, “Libya”, 261.

137 Spector, New Nuclear Nations, 156.

138 Richelson, Spying on the Bomb, 327; Spector, New Nuclear Nations, 157; Nuclear Programmes in the Middle East, 99.

139 Bowen, “Libya and Nuclear Proliferation”, 31; Nuclear Programmes in the Middle East, 98.

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well as the peaceful nature of Libya’s nuclear program.140 This appears to have been the principal reason for Libya’s difficulties in obtaining nuclear technology, rather than sanctions.

Financial Constraints

This part considers whether sanctions may have slowed down the nuclear program by limiting the availability of financial resources. In concludes that sanctions did not have such a dampening effect since oil revenues buoyed the economy until the early 1980s.

Libya’s economy experienced spectacular growth rates in the 1970s following the oil crises.141

Based on oil exports, the high growth rates continued till the early 1980s when oil prices began to plummet.142 Around the mid-1980s revenues began to decline due to a dramatic fall in oil prices.

Figure 6.1 Libya’s GDP during Pursuit (1)

Source: Plotted based on data from OPEC Annual Statistical Bulletin (Organization of the Petroleoum Exporting Countries, Vienna), various years, http://www.opec.org.

140 Bowen 2006, 18-19; 27

141 Oil was discovered in 1959 and the first exports began to flow in 1961.

142 Economist Intelligence Unit, Country Profile Libya, 1988-89, 11.

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By the mid-1980s the populace began to face shortages of everyday commodities.

However the leaders were shielded from such economic hardship and continued spending on large national projects.143 One major such proposal was the Great Man-Made River project launched in 1983. The scheme, which aimed to tap the underground water reservoirs in the south for use in the coastal areas, was estimated to cost about $25 billion.144 Moreover financial issues do not appear to have hampered the nuclear program.145 This can be gleaned from the regime’s active pursuit of nuclear technology – importing yellowcake, and supplying finances for Pakistan’s nuclear program (estimated to be between $100 and $500 million) as well as other loans and investments for Pakistan (totaling $133 million in 1979 alone).146

(b) Motivational Changes

Did sanctions affect the desire for nuclear weapons during Pursuit (1)? Sanctions could possibly have either deepened such motivations or reduced them, depending on how the regime perceived the costs and benefits of the nuclear program.147 However, since the sanctions were not pegged to a demand to end nuclear weapons pursuit, it is likely that the regime perceived few sanctions-related benefits by slowing down the program. In other words, sanctions are unlikely to have put brakes on the program through motivational factors. Instead, sanctions could possibly have increased the leadership’s desire for nuclear weapons. For example,

143 Mansour O. El-Kikhia, Libya’s Qaddafi: The Politics of Contradiction (Gainesville: University Press of Florida, 1997), 94.

144 Judith Gurney, Libya: The Political Economy of Oil (Oxford University Press, 1996), 208.

145 Bowen, “Libya and Nuclear Proliferation”, 25, 30.

146 Bowen, “Libya and Nuclear Proliferation”, 30-31.

147 For example, the leadership may view the sanctions as a worsening of its security conditions, and thus increase the motives for nuclear weapons; or it may conclude that undertaking restraint will improve security and eliminate sanctions.

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Qaddafi is said to have been “alarmed” when the United States named it a state sponsor of terrorism, declaring that anyone who allied with America was an enemy of Arabs.148 Qaddafi’s policy of supporting anti-Western regimes in Africa (such as in Chad, Tunisia, and Uganda), together with an emerging relationship with the Soviets, meant that the United States increasingly regarded him as an enemy.149 The Reagan administration was particularly antagonistic, starting military exchanges with the shooting of two Libyan attack planes in

1981.150 Since then, the Libyan confrontation with the West has been epitomized by its hostility to the United States.151 US accusations of Libyan complicity in a number of international terrorist incidents, coupled with increasing sanctions, may have increased Qaddafi’s threat perceptions.152

Qaddafi’s contrary statements on the desirability of nuclear weapons suggest that he may have been thinking of the advantages as well as disadvantages of possessing them. There is no obvious evidence that sanctions played into such thinking.

Restraint 1 – (Slow) mid 1980s- 1995

The concerted effort to acquire fuel cycle capability began to face significant procurement difficulties from the mid-1980s. Two major nuclear cooperation agreements (with

Belgian and Soviet firms respectively) were abandoned. This period is classified as the first phase of nuclear restraint since Libya found it difficult to obtain nuclear technology at a time

148 Yehudit Ronen, Qaddafi’s Libya in World Politics (Boulder: Lynne Rienner Publishers, 2008), 15-16.

149 Ronen, Qaddafi’s Libya, 15; Ronald Bruce St. John, Libya and the United States: Two Centuries of Strife (Philadelphia: University of Pennsylvania Press, 2002), 118-119.

150 St John, Libya and the United States, 125.

151 Dirk Vandewalle, A History of Modern Libya, 2nd ed. (New York: Cambridge University Press, 2012), 130-131.

152 One significant military skirmish at this time involved a brief border war with Egyptian forces in 1977. Libya accused the United States of providing intelligence support to Egypt. Ronen, Qaddafi’s Libya, 16.

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when it was consciously seeking weapons capability. The failure to consummate any of the several attempted deals suggests that the program proceeded more slowly than desired.

Between 1983 and 1985 Libya “actively pursued” technology to produce fissile material indigenously, but only succeeded in obtaining associated documents.153 As part of the quest for reprocessing technology Libya fabricated small uranium oxide and uranium metal targets and irradiated them at the IRT-1 between 1984 and 1990. It then extracted very small amounts of plutonium from a few of the targets in the radiochemical lab at the TNRC.154 Despite such limited progress, the nuclear weapons program experienced restraint during this time due to a number of other frustrated attempts at further developing weapons capability. For example

Libya tried but failed to acquire a small reprocessing facility from Argentina; and received only some parts of a uranium conversion facility indirectly from Japan.155 Also, negotiations for two nuclear power plants from the Soviet Union collapsed during this time. This section will first consider whether Restraint 1 was largely driven motivationally or by resource constraints. It shows that both routes were influential at different times during Restraint 1. The analysis then assesses the role of sanctions in slowing down the nuclear program.

Restraint 1: Motivational or Resource Driven?

As suggested by the preceding discussion, the Libyan regime was seeking to develop nuclear weapons capability but was frustrated by the inability to obtain technology abroad. It had been facing such difficulties since the 1970s; their continuance in this period slowed down

153 IAEA Report, September 12, 2008, 4.

154 IAEA Report, February 20, 2004, 6.

155 Libya tried but failed to obtain a uranium conversion from the Soviet Union in 1985. Bowen 2006, 32; IAEA Report, September 12, 2008, 4, 6. In 1985 Libya also sent some yellowcake to the Soviet Union, which converted and returned to Libya different uranium compounds, including 39 kg uranium hexafluoride. IAEA Report, May 28, 2004, Annex 1, 3.

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the weapons program at a time when the regime was consciously seeking fuel cycle capability.

Hence resource denial was an important cause of Restraint 1. Restraint 1 can be divided into periods – the late 1980s, when restraint was driven by resource denial; and the early 1990s when some motivational factors also contributed to restraint.

Late 1980s

In the late 1980s, technology denial by supplier states restrained the nuclear program. In addition, Libya’s oil revenues declined significantly due to drastic dips in world oil prices. This increased the relative costs of the program. Both these factors point to resource constraints as the main cause of restraint at this time.

There were several instances of technology denial in the late 1980s. Libya failed to obtain a small-scale reprocessing plant. The effort to acquire additional reactors from the Soviet Union also failed largely due Soviet concerns about proliferation (discussed below). For uranium enrichment, Libya tried to acquire a uranium conversion facility, but only obtained parts and incomplete instructions in the mid-1980s. Moreover, the plant was incapable of producing uranium hexafluoride, a capability that Libya was seeking to acquire.156 Further, Libya hired a

German engineer to develop centrifuges. Although working on this throughout the 1980s, this effort appears to have stalled due to procurement difficulties for specialized centrifuge materials. These significant technological obstacles slowed down the nuclear weapons program.

The slow growth in the program has led to speculations of weak desire for nuclear weapons.157 After all, Qaddafi had been seeking nuclear weapons since 1970. However, the

156 Bowen, “Libya and Nuclear Proliferation”, 34.

157 Harald Muller, “The exceptional end to the extraordinary Libyan nuclear quest” in Morten Bremer Maerli and Sverre Lodgaard, eds., Nuclear Proliferation and International Security (New York: Routledge, 2007), 82-83; Solingen, Nuclear Logics, 226-227.

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repeated efforts to acquire fuel cycle capability are strongly suggestive of the intent to weaponize.158 Slowness can instead be attributed to inability in finding foreign suppliers as well as an intrinsic inefficiency that appeared to characterize other large projects launched by the regime.159 Therefore, restraint in the late 1980s was principally the result of resource denial.

Early 1990s

In the early 1990s, the desire for nuclear weapons may have declined due to the regime’s preoccupation with two major developments – the rapid rise of domestic opposition to the regime, culminating in violent rebellions; and UN accusations of Libyan complicity in the

Lockerbie bombing, which resulted in the imposition of sanctions. At this time the regime displayed some interest in trading its nuclear program for better relations with the United States.

Evidence of such an effort is inconclusive, but it suggests that Qaddafi did not have an inflexible desire for nuclear weapons, and that he was willing to consider restraint if it improved Libya’s international relations. As discussed below, the principal driver behind the alleged offer of nuclear rollback seems to have been the hope that this would improve Libya’s relations with the

United States, and therefore its security.

In the early 1990s, the resource factors affecting the nuclear program changed. On the one hand, Libya’s emerging relations with the Khan network meant that there was now a new viable source of nuclear technology. Resource availability also improved slightly with the short-

158 Another indication is the effort to explore local uranium deposits with the help of a Brazilian company in the mid-1980s. IAEA Report, September 12, 2008, 4.

159 For example, the Misrata steel complex spearheading Libyan industrialization was “chronically unprofitable”; and the grandiose Great Man-Made River Project for supplying underground water from the central areas to the coast eventually suffered from cash shortages (El-Kikhia 1997, 92). The nuclear program was also characterized by general mismanagement and inefficiency (Solingen 2007, 217). El-Kikhia, Libya’s Qaddafi, 92; Solingen, Nuclear Logics, 217.

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lived rise in oil revenues against the background of the Iraq-Kuwait crisis. On the other hand, the UN sanctions imposed in 1992 made it difficult to access nuclear technology.

To compare the relative importance of resource and motivational factors in the early

1990s, I consider the following counterfactual. Suppose Qaddafi’s desire for nuclear weapons continued unabated at this time; perhaps nuclear motives were even strengthened by the threat perceptions emanating from the 1991 Gulf War. In such a situation, would Libya have made substantial progress on the nuclear program? It is highly likely that it would not, since it faced not only the same technological constraints of the 1980s, but also additional constraints in the form of UN sanctions since 1992. Although it is theoretically possible that Libya would renew contacts with the Khan network and begin receiving supplies in the early 1990s, this is unlikely because international scrutiny under UN sanctions appear to have complicated the deliveries.160

Thus Restraint 1 was largely due to resource constraints, although the nature of these constraints changed. In the late 1980s, suppliers were reluctant to provide nuclear technology, and Libya faced declining oil income. In the early 1990s, although Libya found a new potential source in the Khan network, supplies were made difficult by the UN sanctions. Hence resource constraints were the main reason for Restraint 1. Nevertheless, since Qaddafi’s motives for nuclear weapons appear to have declined slightly in the early 1990s, this analysis considers the effects of sanctions on both routes to restraint. The following segment lists the possible sanctions affecting Restraint 1, followed by an analysis of the role of sanctions in resource denial and motivational factors.

160 According to Albright, the sanctions did obstruct deliveries from the Khan network. Albright, Peddling Peril, 119. The eventual supply of centrifuges and related components in the late 1990s occurred only after the sanctions lost their legitimacy and were increasingly flouted. This is discussed later in the chapter.

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Sanctions possibly affecting Restraint 1

During Restraint 1 Libya experienced general US sanctions and in the early 1990s was also placed under some UN sanctions. The US sanctions barring the import of Libyan crude oil first imposed in 1982 continued during this period.161 In 1985 the United States also banned the import of refined petroleum products from Libya. Comprehensive US trade sanctions were placed in early 1986 in response to terrorist attacks in Rome and Vienna.162 Invoking the

International Emergency Economic Powers Act (IEEPA),163 the Reagan administration prohibited all imports and exports as well as US loans and credits. It also froze assets of the

Libyan government in the United States, worth about $200 million.164 However the foreign subsidiaries of US firms were exempted and the assets of US oil companies in Libya were frozen so as to protect them from losses.165

Since the mid-1980s Libya also faced some limited sanctions from Europe. Britain imposed an oil embargo and severed diplomatic links in 1984 after a police officer was killed by

161 These included a ban on the import of Libyan crude oil, and the export of oil and gas technologies.

162 Some 20 civilians including five Americans were killed in attacks at the Rome and Vienna airports in December 1985. They were reportedly conducted by the Abu Nidal organization, which was financially supported by Libya. It was later shown that the bomb explosions were planned from Syrian-controlled Lebanon. Niblock, Pariah States, 30.

163 Reagan’s use of these emergency powers was somewhat controversial, as it required the administration to argue that the United States faced a security or economic threat from Libya. The administration defended its declaration of a national emergency on the grounds that Libya was engaged in terrorism. John Frederick Cooke, “United States’ 1986 Emergency Economic Sanctions against Libya – Have They Worked?”, Maryland Journal of International Law and Trade, 14 no. 2 (1990).

164 Lillian Craig Harris, Libya: Qadhafi’s Revolution and the Modern State (Westview Press, 1986), 117.

165 Under the 1986 sanctions, US oil companies were to dispose of their assets and withdraw from Libya. These firms were operating as joint ventures with the Libyan National oil Company (LNOC), which now stood to gain $1 billion annually by confiscating their assets on the grounds of defaulted contracts. Kenneth A Rodman, Sanctions Beyond Borders: Multinational Corporations and US Economic Statecraft (Lanham: Rowman & Littlefield Publishers, Inc, 2001), 153. By arguing on these lines, the companies obtained exemptions from the Treasury Department allowing them to continue their operations for three years. A deadline of 30 June 1989 was set for the final withdrawal of the companies.

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shots fired from the Libyan embassy in London during a demonstration against Qaddafi.

However it continued to have robust trade relations until the late 1980s.166 Following allegations of Libyan involvement in the bombing of a Berlin nightclub in April 1986,167 the European

Community imposed limited trade sanctions, diplomatic restrictions on travel, and an arms embargo.168

Mandatory UN sanctions on Libya were imposed in 1992 under allegations of Libyan involvement in the 1988 Lockerbie bombing that killed 270.169 Another major terrorist attack that was linked to Libya was the 1989 explosion of a French UTA aircraft over Niger, killing

171. In 1991 a French judge charged two Libyan intelligence officers with involvement in the

UTA bombing. Just two weeks later the United States and the United Kingdom indicted two other Libyan intelligence agents with the Pan Am explosion over Lockerbie. Libya strongly denied involvement and called for a legal process outside the United States and Britain.170 It arrested the individuals (accused in the Lockerbie case) but refused to extradite them. In January

1992 the UN Security Council passed Resolution 731 demanding that Libya cooperate with the investigations on the Pan Am and UTA crashes. Libyan officials maintained that the resolution

166 Niblock, Pariah States, 31.

167 The attack killed two American servicemen and wounded another 50, killing a total of three people and wounding 230 (State Department 2008). At the time it was believed that Libya was behind the bombing; however later evidence suggested that it was conducted by a Palestinian group with Syrian support. Economist Intelligence Unit, Country Report Libya, 1996-1997, 10; Niblock, Pariah States, 31.

168 Niblock, Pariah States, 31-32.

169 The role of either the Libyan state or Libyan individuals in the Lockerbie bombing remains unclear to this day. Libya was first accused of involvement in October 1990, about two years after the incident. It is believed that radical Palestinian groups associated with Iran or Syria may have carried out the attack – Iran may have retaliated against the July 1988 shooting down of an Iranian civilian flight killing 290. Khalil I. Matar and Robert W. Thabit, Lockerbie and Libya: A Study in International Relations (McFarland Inc. & Co, 2003); Boutros Boutros-Ghali, Unvanquished: A US-UN Saga (Random House, 1999). However the United States needed the support of major states like Syria and Iran in the upcoming Gulf War against Iraq. This may explain the timing of the sudden accusation of Libyan complicity. Niblock, Pariah States, 36.

170 Niblock, Pariah States, 37.

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did not require Libya to extradite the two suspects as this demand was not specifically mentioned in the text of the resolution.171

The Security Council passed Resolution 748 in March 1992 mandating diplomatic sanctions as well as a complete arms and air embargo.172 The Council strongly demanded

Libyan cooperation in resolving the cases and to stop all terrorist activities. In November 1993 the Security Council further tightened the sanctions by banning the export of petroleum equipment to Libya and freezing the funds and financial assets of the Libyan government as well as private Libyan entities, while upholding the arms and air embargoes (Resolution 883).

Sanctions and Restraint 1

This period of restraint consists of two parts – the late 1980s, when Libya found it difficult to access nuclear technology abroad; and the early 1990s, when the motives for nuclear weapons may have weakened. It is argued here that sanctions were not influential in resource denial in the late 1980s; but they appear to have significantly affected both resource availability and motives in the early 1990s.

(a) Resource Denial in Restraint 1

On several occasions Libya encountered obstacles to obtaining foreign technology abroad. To what extent were sanctions responsible for such resource denial? This section shows that technology denial in the 1980s sprung from suspicions of the Qaddafi regime rather than

171 Resolution 731; Boutros-Ghali, Unvanquished.

172 The diplomatic measures states were required to do included “significantly reduce[ing] the No. and the level of the staff at Libyan diplomatic missions and consular posts…” and barring entry to Libyans suspected of being involved in terrorist activities. The arms and air embargoes prevented the sale of arms and related equipment, technical assistance or training in weapons, the flight of aircraft to or from Libya, and the sale of aircraft or related components (Resolution 748).

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from sanctions. However, sanctions appear to have had some impact in the early 1990s, when the UN sanctions were imposed.

Technology Denial

During this period (mid-1980s to mid-1990s) Libya did not seek nuclear technology from the United States, probably due to the deteriorating relations including military exchanges in the

Gulf of Sidra. Hence American unilateral sanctions did not deny nuclear technology. One occasion of technology denial relates to a failed attempt to acquire a reprocessing plant from

Argentina in 1985. This is attributed to US pressure on Argentina.173 The other instances of technology denial at this time pertain mainly to unfulfilled overtures with European and Soviet sources. Belgium suspended negotiations to supply a plant to produce uranium tetrafluoride due to American pressure.174 By the mid-1980s all nuclear cooperation with Belgium was cancelled.

This was obviously not the result of sanctions.

Another major deal that was cancelled in the mid-1980s was the Soviet agreement to supply two nuclear power plants. The project did not proceed beyond a feasibility study and design development due to a combination of factors. These may have included Gorbachev’s new foreign policy as well as Libyan concerns about reactor safety after the Chernobyl nuclear accident in 1986. However the overarching factor appears to have been Soviet concerns about

Libyan interest in developing nuclear weapons.175 Again, the denial of technology was not due

173 According to Kroenig (2010, 105), “When the United States discovered the existence of the planned nuclear transfer it intervened and forced Argentina to cancel the sensitive nuclear export.”

174 Spector and Smith, Nuclear Ambitions, 177.

175 Bowen, “Libya and Nuclear Proliferation”, 33; Nuclear Programmes in the Middle East, 99. Soviet concerns about proliferation may have been heightened after Qaddafi declared that Arabs must acquire a bomb. “ Soviets draw back from helping Libyan programme,”, Nuclear Engineering International.

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to sanctions. Soviet assistance ended in 1991, after which local personnel operated the IRT-1 reactor with periodic interruptions.

It is believed that Libya turned to the Khan network in the 1980s because of difficulty getting nuclear technology from established suppliers.176 The UN sanctions probably contributed to wariness of the regime, making it difficult to buy nuclear technology from the open market.177 In the 1990s, deals with the Khan network were incompletely fulfilled due to the UN sanctions178 – centrifuge components remained in storage in Dubai.179 The supply of ballistic missile technology and materials for producing chemical weapons were also interrupted by the UN sanctions.180 In any case, the fact that the network supplied 20 P-1 centrifuges and components for another 200 in 1997, when the sanctions were still in force, suggests that they did not make such supplies impossible. Still, the extent and pace of the deliveries seemed to pick up after sanctions were suspended in 1999.181 Thus the UN sanctions appear to have made it harder, but not impossible, for Libya to attain nuclear and other WMD technology.

In sum, unilateral sanctions do not appear to have been an important cause of technology denial during Restraint 1. Although the UN sanctions disrupted some supplies, they did not block them altogether. Ultimately, the overall impact of sanctions was secondary to widespread

176 Corera, Shopping for Bombs, 108.

177 Feldman and Mahaffey, “Libya”.

178 Albright, Peddling Peril, 119.

179 According to Libya, it received some components and documents for P-1 centrifuges in January 1991 but further supplies were suspended partly due to the UN sanctions. The sanctions may have complicated the delivery of nuclear technology since they banned the supply of arms and oil equipment, and prohibited flights to and from Libya. Albright, Peddling Peril, 119; IAEA Report, September 12, 2008, Annex 3.

180 Hart and Kile, “Libya’s renunciation”, 646. Libya had a chemical weapons facility at Rabta, which produced mustard agent between 1989 and 1990. Jonathan Tucker, “The Rollback of Libya’s Chemical Weapons Program”, Nonproliferation Review, 16 no. 3 (2009). Tucker 2009.

181 Albright, Peddling Peril, 119-122.

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concerns about Qaddafi, due to which supplier states were hesitant to provide nuclear technology.

Financial Constraints

It seems that Libya may have faced some financial constraints on the nuclear program from the mid-1980s. For example, one of the reasons for the cancellation of the Soviet nuclear power plant deal is speculated to have been concerns about Libya’s declining ability to pay for the reactors.182 It is argued that falling oil revenues in the 1980s and 1990s and their associated economic problems restricted investment in the program.183 Other development schemes were also affected at this time – housing and road projects worth $1 billion were cancelled; and the foreign work force was severely cut. Only the Great Man-Made River project seemed to continue.184

As an oil exporter, financial issues were not a major problem for Libya in the 1970s during the oil boom. From the 1980s, however, there were significant fluctuations in oil income, which were closely associated with declining GDP as seen in the graph below.185

182 It was reported in 1986 that the proposal for the nuclear plants was being temporarily abandoned due to Libya’s difficulty in paying the $4 billion price tag. “Libya abandons plans for first unit”, Nuclear Engineering International, 31 no. 381 (1986), 6.

183 Braut-Hegghammer, Nuclear Entrepreneurs, 112-113; Nuclear Programs in the Middle East, 98-99.

184 Edward Schumacher. “The United States and Libya”, Foreign Affairs, 65 no. 2 (1986-1987).

185 Bowen, “Libya and Nuclear Proliferation”, 33; Nuclear Programmes in the Middle East, 99. The contribution of oil to national income fluctuated between 60 percent in the 1970s to about 30 percent in the 1990s. However, about 80% of GDP depended on the oil sector in some way. El-Kikhia, Libya’s Qaddafi, 92. Oil exports also brought about 95% of the country’s foreign exchange earnings. Economist Intelligence Unit, Country Profile Libya, 1996- 97, 14.

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Figure 6.2 Libya’s GDP and Oil Revenues in Restraint 1

Source: Plotted based on data from OPEC Annual Statistical Bulletin (Organization of the Petroleoum Exporting Countries, Vienna), various years, http://www.opec.org.

Oil revenues fell from almost $22 billion in 1980 to just $5 billion in 1986.186 Libya briefly benefited from windfall earnings during the Iraq-Kuwait crisis in 1990-1991. However, revenues declined with the imposition of UN sanctions in 1992 as well as declining oil prices.187

One indication of economic difficulties is the launch of economic reforms in 1987-

1988.188 It is generally held that the drop in oil revenues in the 1980s is largely explained by the sudden fall in oil prices in 1982 and 1986 rather than by sanctions.189 This implies that even if

186 Economist Intelligence Unit, Country Profile Libya, 1987-88.

187 Economist Intelligence Unit, Country Profile Libya, 1996-97, 15.

188 The reforms aimed at restricting government interference in the economy, thus encouraging private enterprises. Dirk J. Vandewalle, Libya Since Independence: Oil and State-Building (Cornell University Press, 1998, 153.

189 M. Hakan Berument, Nildag Basak Ceylan, and Nukhet Dogan, “The Impact of Oil Price Shocks on the Economic Growth of Selected MENA Countries”, The Energy Journal, 31 no. 1 (2010); O’Sullivan, Shrewd Sanctions, 195-196; ; Economist Intelligence Unit, Country Profile Libya,1996-97, 13; Economist Intelligence Unit, Country Profile Libya, 2004, 32; Economist Intelligence Unit, Country Profile Libya,1988-89, 11. Oil prices fell from $27.79 per barrel in 1985 to $14.31 in1986. OPEC Annual Statistical Bulletin 1999.

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financial constraints impacted the nuclear program, sanctions were not the most important cause of this.

However, sanctions did contribute to Libya’s financial difficulties in this period by affecting oil production. After American oil companies withdrew in 1986, the Libyan National

Oil Company lost access to technology and was thus less efficient in its operations.190 It was increasingly difficult to obtain spare parts relating to oil production.191 Huffbauer et al estimate the loss to Libya from the ban on oil exports to the United States to be $101 million annually between 1981 and 1985, with an additional $10 million in non-oil exports.192 They estimate the net annual loss from US sanctions to be around $151 million before 1986 (after including losses in the aviation industry). At the end of the day, however, the US sanctions had a limited economic impact on Libya since it displayed one of the classic methods for coping with sanctions – adjusting its economy to the new situation through such measures as finding new trade partners. Oil exports to the United States were replaced by the new destination of Europe – mainly Germany, Spain, and Italy.193

Unlike the US sanctions, which were total and comprehensive, UN sanctions were limited to specific sectors (the supply of technology and spare parts in the oil and aviation industries; arms embargo; ban on air travel; and diplomatic sanctions). Although narrower in scope, the UN sanctions appear to have had a greater impact on the Libyan economy when

190 Libya also lost its ties with the international oil network that acts as a buffer for exporters during glut markets, forcing it to sell some 300,000 barrels per day at very low prices on the spot market. Rodman, Sanctions Beyond Borders, 155.

191 O’Sullivan, Shrewd Sanctions, 197.

192 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM.

193 O’Sullivan, Shrewd Sanctions, 190.

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compared with the US sanctions due to their multilateral character.194 They displayed an

“exceptionally high” level of compliance by member countries.195 The UN trade sanctions directly affected Libya’s revenues by blocking access to technology and spare parts including oil recovery methods and oil refining.196 The oil sector suffered from a lack of interaction with counterparts in the rest of the world engaged in the latest technologies and equipment.197 By the

1990s the oil fields were ageing while few new reserves were being discovered.198 In 1995 oil production in at least one major field fell due to the natural decline of reserves.199

The financial UN sanctions -- freeze of Libyan assets abroad -- limited the country’s ability to earn income from these sources. The UN sanctions also resulted in stockpiling reserves and assets in order to meet future restrictions, thus reducing Libyan liquidity and the ability to continue existing development projects.200 However, the overall impact of the financial sanctions was limited as Libya had time to transfer its assets.201

The indirect economic effects of the UN sanctions involved the tremendous devaluation of the Libyan dinar and the concomitant rise in inflation, which greatly increased the cost of

194 Gurney, Libya; Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM; O’Sullivan, Shrewd Sanctions, 195-197; Dirk J. Vandewalle, “Libya in the New Millennium” in Dirk J. Vandewalle, ed., Libya Since 1969: Qadhafi’s Revolution Revisited (New York: Palgrave Macmillan, 2008), 156.

195 Stephen D. Collins, “Dissuading State Support of Terrorism: Strikes or Sanctions? (An Analysis of Dissuasion Measures Employed Against Libya)”, Studies in Conflict and Terrorism, 27 no. 1 (2004), 13.

196 Economist Intelligence Unit, Country Profile Libya, 2008, 16-17; O’Sullivan, Shrewd Sanctions, 197.

197 Gurney, Libya, 221-222.

198 Gurney, Libya,

199 Mary-Jane Deeb, “Political and Economic Developments in Libya in the 1990s” in Yahia H. Zoubir, ed., North Africa in Transition: State, Society, and Economic Transformation in the 1990s (Gainesville: University of Florida Press, 1999), 84.

200 O’Sullivan, Shrewd Sanctions, 198-199.

201 O’Sullivan, Shrewd Sanctions, 196-197; Blanchard, “Libya”, 5; Ian Hurd, “The Strategic Use of Liberal Internationalism: Libya and the UN Sanctions, 1992-2003”, International Organization, 59 no. 3 (2005), 515.

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living.202 French assessments reportedly estimated that living costs doubled between 1992 and

1995.203 This increased the prevalence and importance of black markets, which further increased prices.204 Thus although the UN sanctions did not significantly hamper the core economy, the living conditions of the population markedly declined.205 This had implications for regime survival based on rising domestic discontent as discussed later. It affected the nuclear program in that any spending was now relatively more costly. Indeed it seems that the regime prioritized spending on two major sectors to the exclusion of all others – the oil industry and the Great

Man-Made River project.206

Conclusion: Financial Constraints in Restraint 1

Libya’s economic troubles in the 1980s can be significantly traced to the external development of falling oil prices and a global recession.207 Sanctions contributed to emerging economic problems both directly by limiting access to spare parts and technology, and indirectly by discouraging foreign investment. They thus helped reduce the pool of resources available for the nuclear program. Financial considerations seem to have affected the nuclear program at least on two occasions during Restraint 1. In the mid-1980s, the Soviets reportedly became concerned about Libya’s decreasing oil revenues and its ability to finance two nuclear power plants,

202 Niblock, Pariah States, 67.

203 Deeb, “Political and Economic Development in Libya”, 85.

204 O’Sullivan, Shrewd Sanctions, 198.

205 Niblock, Pariah States, 63-64.

206 Niblock, Pariah States, 68-69.

207 After a continued period of rising oil prices the international market began to show a downward trend starting in 1982. These falling prices were accompanied by declining demand (due to such diverse factors as worldwide economic recession, improved efficiency in using energy, and techniques for conserving oil) as well as increasing production from emerging sources of oil such as the North Sea. Gurney, Libya, 95.

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leading to the cancellation of the deal.208 In another instance, the Libyan leadership appears to have considered the supplies from the Khan network as incommensurate with the money offered.209 However, such financial constraints are unlikely to have had a paramount influence on the nuclear program as evinced by existing activities. The regime continued to fund other projects – supporting terrorist activities and militarily intervening in Chad and other neighboring countries. In 1984 Libya launched the Great Man-Made River Project, spending about $20 billion over the next twenty years.210

Conclusion: Resource Constraints and Restraint 1

In sum, difficulties with technology acquisition significantly constrained the nuclear program during Restraint 1. Although sanctions contributed to this in the early 1990s, the main cause of technology denial was wariness of the Libyan regime. Libya also faced financial difficulties at this time, apparently leading to a more careful consideration of spending.

However, the slow growth in the nuclear program is not mainly attributable to a financial crunch as the regime continued to spend on at least one other major project. Thus sanctions-induced resource constraints on the nuclear program were minimal during Restraint 1.

(b) Motivational Changes

It has already been shown that Restraint 1 was principally caused by resource factors, while the motivations for nuclear weapons appeared strong at least in the late 1980s. This

208 “Soviets draw back from helping Libyan programme”.

209 IAEA Report, September 12, 2008.

210 “Libya thirsts for ‘fossil’ water”, BBC. The scheme was impressive in its scale, aiming to tap underground water reserves from the central region to make them available to the populous coastal areas. Qaddafi called it the “eighth wonder of the world”. The project began to yield fruit in the early 1990s, with the availability of tap water in Benghazi and Tripoli. Economist Intelligence Unit, Country Profile Libya, 1996-1997, 18.

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section establishes that the 1986 US airstrikes apparently strengthened the desire for nuclear weapons. However, motives for nuclear weapons may have declined in the early 1990s. In 1992

Libya reportedly approached the United States with a tentative offer of WMD rollback in exchange for normal relations. William Rogers, a former official in the State Department, is said to have met Qaddafi in January 1992. Rogers reportedly told him that the United States wanted

Libya to surrender the Lockerbie suspects, share intelligence, cease terrorist activities, stop interfering in African neighbors, and offer full inspection of WMD programs.211 In March 1992 former US Senator and presidential candidate Gary Hart apparently met the regime’s number two in command, Major Abdul Salam Jalloud in Tripoli. According to Hart, he conveyed to the

Libyans that normalization could not occur until other issues including WMD were resolved, to which Jalloud allegedly said, “everything will be on the table.” The United States apparently rejected the offer due to the political costs of negotiating with Libya since Lockerbie was the foremost issue.212

Another indication of a possible decline in the desire for nuclear weapons is that Libya did not renew contact with the Khan network between 1991 and 1995.213 This was in part due to the view that Libya had overpaid for incomplete or faulty items.214 Nevertheless it could also be suggestive of a slight waning in the desire for nuclear weapons. This section considers the

211 Barbara Slavin, “Libya’s rehabilitation in the works since early ‘90s”, USA Today, April 26, 2004. Regarding Libyan WMD, the main US concern was chemical weapons. Joshua Sinai, “Libya’s Pursuit of Weapons of Mass Destruction”, Nonproliferation Review, 4 no. 3 (1997). Although US officials were aware of Libyan interest in nuclear weapons, they appear not to have known the clandestine aspects of the nuclear program such as the details of links with the Khan network.

212 Hart, “My Secret Talks With Libya”.

213 After conducting discussions on obtaining centrifuge technology in 1989-1991, Libya appears to have dropped contact with the network until 1995. IAEA Report, September 12, 2008.

214 IAEA Report, September 12, 2008, 5.

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external security and domestic political causes of a possible decline in motivations for the nuclear program during Restraint 1.215

Security Model

In the first part of Restraint 1 (late 1980s) the motives for nuclear weapons appear to have further deepened due to the security implications of the 1986 US attacks. In the early 1990s, however, security considerations may have dampened the desire for nuclear weapons.

The 1986 airstrikes are believed to have strengthened regime motivation for nuclear weapons by underlining the security threat from the United States. They also bolstered the regime internally.216 Since the 1970s Libya had troubled relations with the United States, which employed both sanctions and military actions. The presence of the US Sixth Fleet in the

Mediterranean was already an irritant for the regime, which sought to dominate the Gulf of

Sidra. With direct American strikes apparently aimed at the regime, the leadership began to view the United States as a serious threat.217 In fact, the rationale for nuclear weapons seems to have shifted (from tool for Arab prestige and deterrent against Israel) to seeking a deterrent against another US attack.218 Nuclear weapons would help counter security threats from the

215 There is no evident prestige motive for slowing down the nuclear program between the mid-1980s and mid- 1990s, since Libya did not claim to be subscribing to the non-proliferation norm. Indeed, prestige considerations strengthened the motive for nuclear weapons – for example, in 1987 Qaddafi stated, “We should be like the Chinese – poor and riding donkeys, but respected and possessing an atom bomb.” Spector, Undeclared Bomb, 202.

216 Jentleson and Whytock, “Who ‘Won’ Libya”, 60.

217 Cremasco, “Libya”, 273-274; Jentleson and Whytock, “Who ‘Won’ Libya”, 58-59; Joffé, “Libya”. Even before the attack there were reports of covert CIA efforts to topple Qaddafi.

218 Braut-Hegghammer, “Libya’s Nuclear Turnaround”, 64; Solingen, Nuclear Logics, 227. Referring to the US air strike, Qaddafi stated “If we had possessed a deterrent – missiles that could reach New York – we would have hit it at the same moment, Consequently, we should build this force so that they and others will no longer think about an attack… This should be one homeland [Arab], the whole of it, possessing missiles and even nuclear bombs. Regarding reciprocal treatment, the world has a nuclear bomb, we should have a nuclear bomb.”Spector and Smith, Nuclear Ambitions, 183.

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United States as well as promote regional influence.219 Based on interviews with Libyan officials, Braut-Hegghammer writes that after the 1986 attacks the leadership concluded that the

Soviet Union was not a helpful ally; that its radical foreign policy was increasing its insecurity; and that Libya had to contend with American political and military power.220 In the aftermath of the US attacks the regime sought to disperse sensitive nuclear acquisitions – parts of a uranium conversion facility were scattered in disperse locations in order to avoid being targeted.221 Thus motivations for nuclear weapons appear to have strengthened in the second half of the 1980s.

The security model suggests that restraint in the early 1990s may have been partly driven by further security concerns vis-à-vis the United States. Another rogue state, Iraq, was decisively attacked and defeated by a US-led coalition, followed by an intensive UN system aiming to eliminate Iraq’s WMD capabilities. The following pages make the argument that

Qaddafi may have been motivated to offer nuclear rollback due to worsening security conditions in the early 1990s. He appears to have viewed the UN sanctions as symptomatic of strengthened

American hostility to his regime.

After the 1986 attacks the threats from America were reinforced in the late 1980s with

US accusations of Libyan WMD programs. In 1989 the United States threatened to attack the

Rabta Pharmaceutical Factory, which housed a plant for the production of mustard agent.222

This is led Qaddafi to shut down the Rabta plant in 1990.223 In 1994 Libya started building

219 Muller, “The Exceptional End to the Extraordinary Libyan Nuclear Quest”, 84.

220 Braut-Hegghammer, “Libya’s Nuclear Turnaround”, 64; El-Kikhia, Libya’s Qaddafi, 135.

221 Bowen, “Libya and Nuclear Proliferation”, 22.

222 Tucker, “The Rollback of Libya’s Chemical Weapons Program”, 372.

223 Jentleson and Whytock, “Who ‘Won’ Libya”, 63. Libya produced mustard agent at Rabta between 1989 and 1990; in response to US allegations of chemical weapons production, in March 1990 Libya staged the facility as 320

another chemical weapons facility at Tarhunah. This project was also stopped and abandoned in late 1996 in response to public US pressure including the threat of military attack.224 These repeated attempts at WMD capability as well as the moves to rollback these projects suggest that the leadership responded to the US-led threats by both pursuit and restraint.

In Qaddafi’s view, external military threats greatly increased with the end of the cold war, America’s successful war against Iraq, and the collapse of the Soviet Union.225 He became convinced that the United States was seeking to overthrow him.226 Qaddafi had always believed that the United States intended to dominate the oil-rich countries of the Middle East.227 Ronen quotes Qaddafi as saying in the early 1990s “When [the United States] finishes destroying Iraq, it will turn its attention to Libya and search for anything to strike.”228 Libyan reaction to the

1991 Gulf War shows Qaddafi’s growing concerns of the consequences of hostility to the

United States. Although strongly opposed to the war initially, he dropped his objection, changing from an “explicitly anti-Western line to a cautious pro-Western position.”229 The

being burned down. By late 1990 it shut down and dismantled the Rabta chemical weapons facility. Tucker, “The Rollback of Libya’s Chemical Weapons Program”, 372.

224 Tucker, “The Rollback of Libya’s Chemical Weapons Program, 373; Jentleson and Whytock, “Who ‘Won’ Libya”, 63-64).

225 Ronen, Qaddafi’s Libya, 5.

226 Ronen, Qaddafi’s Libya, 41, 183, 197; Zoubir, “The United States and Libya”, 50.

227 Mary-Jane Deeb, “The Primacy of Libya’s National Interest” in René Lamarchand, ed., The Green and the Black: Qadhafi’s Policies in Africa (Indiana University Press, 1988), 34.

228 Ronen, Qaddafi’s Libya, 42.

229 George Joffé, “Middle Eastern Views of the Gulf Conflict and its Aftermath”, Review of International Studies, 19 no. 2 (1993), 192. Joffe writes that the change was caused by the involvement of Egyptian President Hosni Mubarak, who warned Qaddafi that his anti-Western stance was likely to bring him greater American hostility after the war. According to Joffe, this led Qaddafi to change his position and even offer troops for the war, whereas previously he had organized a large demonstration against the war and even called for the United States to be placed under international sanctions.

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change was likely evinced by a consideration of the possible diplomatic and military consequences of opposing the United States.230

The emerging threat and eventual imposition of UN sanctions on Libya greatly increased security concerns for the regime. In November 1991, just months after Desert Storm, Britain and the United States indicted two Libyans in the Lockerbie case. Days later Libyan Foreign

Minister Ibrahim Bishari wrote to the Secretary General, stating:

Successive United States administrations have persistently intervened in Libya’s internal affairs with a view to forcibly changing its popular political and social regime, bringing all possible pressures to bear on it… It [the United States] has accused Libya, which it had previously exonerated, … with the premeditated intention of engaging in aggression in order to change the popular democratic regime by force… If, however, it is a matter of another premeditated act of aggression [after the 1986 bombing] on the part of the United States Administration and the British Government with the intention of penalizing Libya, changing its popular political and social regime by force and punishing it for the political positions it has adopted, then we expect the Security Council and General Assembly of the United Nations …to stand by Libya…231

About a month later Bishari again wrote to the Secretary General: “It is our fear that this campaign to mar my country’s good repute and deceive world public opinion is merely a preliminary to renewed aggression against Libya.”232

230 Keith R. Blakely, The Libyan Conversion in Three Acts: Why Qadhafi Gave up his Weapons of Mass Destruction Program, M.A. Thesis (Monterey: Naval Postgraduate School. March 2010), 33.

231 Letter dated 20 November 1991 from the Permanent Representative of the Libyan Arab Jamahiriya to the United Nations addressed to the Secretary-General, 13 January 1992, A/46/844, emphasis added.

232 Letter dated 8 January 1992 from the Permanent Representative of the Libyan Arab Jamahiriya to the United Nations addressed to the Secretary-General, 9 January 1992, A/46/841.

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The letters suggest that the Libyan regime viewed the Lockerbie accusation with alarm.

Just two months after the US court ruling, the Security Council passed Resolution 731 in

January 1992 demanding Libyan cooperation on the Lockerbie and UTA bombings. The resolution was adopted unanimously due to significant American lobbying and tactics.233 The

Libyan leadership interpreted Resolution 731 to imply a real threat of military attack and had lobbied hard to prevent its passage.234 About a month before the resolution Libya declared it was terminating links with terrorist organizations.235 The fear that Libya was becoming the new target in the Middle East for the United States was now strengthened.236 Braut-Hegghammer quotes a Libyan official as stating, “there was a genuine fear of occupation and that the West would try to topple the regime. We had to protect our revolution.”237 Resolution 731 generated such deep concerns within the leadership because it feared that any amount of cooperation would not be rewarded, and that the United States and Britain would continue the campaign to impose sanctions and later use military force to topple the regime.238

Merely two months after the adoption of Resolution 731 the Council imposed sanctions under Chapter VII of the UN Charter, justified on the claim that Libya was a threat to

233 American officials apparently waited for the expiration of the memberships of Cuba and Yemen in the Security Council in order to ensure the unanimous passage of the resolution; unanimity gave significant weight to the American call for sanctions. Hurd, “The Strategic Use of Liberal Internationalism”, 506.

234 Matar and Thabit, Lockerbie and Libya, 11.

235 Collins, “Dissuading State Support of Terrorism”, 12-13.

236 Braut-Hegghammer, “Libya’s Nuclear Turnaround”, 67; Yehudit Ronen, “The Lockerbie Endgame: Qadhdhafi Slips the Noose”, Middle East Quarterly, 9 no. 1 (2002), 54; Matar and Thabit, Lockerbie and Libya, 74.

237 Braut-Hegghammer, “Libya’s Nuclear Turnaround”, 67.

238 Then UN Secretary-General Boutros Boutros-Ghali writes on the Libyan perspective: “Would Resolution 731 be the whole story, or would it be the start of some vast effort to change the government of Libya, to unseat Colonel Qaddafi? From my own conversations with the ambassadors of the three powers, I did not think that they themselves could answer that question”. “The Libyan delegation raised the same questions over and over: If Libya met these demands, what guarantee would it have that the three powers would not then make new demands?” Boutros-Ghali, Unvanquished, 187-188; 191.

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international peace and security. The Libyan leadership perceived this as a likely precursor to military action as it “considered the sanctions resolution as a legitimizing factor for such an action.”239 Qaddafi responded to the sanctions in language that suggests he viewed the external threat as a military one.240 It was probably not lost on him that the US-led UN actions against

Libya were occurring just a year after the United States defeated another “rogue” leader in the region.241 Indeed the French, British, and American governments conveyed the possibility of military strikes as long as the sanctions continued.242 Qaddafi was surprised and disappointed that the sanctions were upheld by even African and Arab countries.243 The political isolation implied by the UN sanctions thus bolstered threat perceptions.244

About a month after the sanctions took effect, Libya accepted the initial resolution demanding cooperation in the Lockerbie and UTA investigations. It took several other steps aimed at reassuring the West.245 In June 1992 Libya declared that it was renouncing terrorism.

239 Economist Intelligence Unit, Country Profile Libya, 1996-1997, 10; Matar and Thabit, Lockerbie and Libya, 26

240 Ronen quotes Qaddafi as reacting to the sanctions thus: If the West “harbors intentions of carrying out aggression, we, too, must beat the drums, close ranks, sharpen our swords, and get ready for confrontation.” Ronen, “The Lockerbie Endgame”, 55.

241 A news article notes: “Another UN Crisis was giving Col. Gadaffi little comfort. As he pondered compliance, Col. Gaddafi watched with alarm as Iraq was asked to fulfill UN resolution requirements while also being told that the US would not agree to lift UN sanctions imposed on it since the 1990-1991 Gulf war as long as President Saddam Hussein remained in power” Roula Khalaf, “Gadaffi’s Big Gamble”, Financial Times (London), Edition 1, April 6, 1999.

242 F. Ugboaja Ohaegbulam, “US Measures Against Libya Since the Explosion of Pan Am Flight 103”, Mediterranean Quarterly, 11 no. 1 (2000), 118.

243 Ronen, Qaddafi’s Libya, 125.

244 O’Sullivan, Shrewd Sanctions; Hurd, “The Strategic Use of Liberal Internationalism”, 504-505; Deeb, “Political and Economic Developments in Libya”; Ronald Bruce St. John, “Libyan Foreign Policy: Newfound Flexibility”, Orbis, 47 no. 3 (2003), 465. A US cable states that Qaddafi had withdrawn from the “media limelight” during the entire period of UN sanctions. Cable from US Embassy, Tripoli to Secretary of State, Washington DC, 28 January 2009, Confidential, Tripoli 00064; Wikileaks, accessed September 7, 2011.

245 Resolution 731. In its most significant concession so far, the regime agreed to fully comply with Britain’s request for information on Libyan support to the IRA. Letter dated 14 May 1992 from the Permanent Representative of the Libyan Arab Jamahiriya to the United Nations addressed to the Secretary-General, S/23918. 324

Most significantly, its first overture to the United States on a possible WMD rollback also occurred in 1992, probably precipitated by the imposition of UN sanctions.246

Sanctions seem to have been an important factor in Qaddafi’s perception of increased security threats in the early 1990s. He tried to get regional support for lifting the sanctions by approaching Egypt, Tunisia, Morocco, and the Arab League. 247 Thus “Qadaffi has [had] tried every means to have the [UN] embargo lifted, short of turning the two suspects over to the

United States or the United Kingdom.”248

Domestic Politics Model

The rise of domestic challenges to the regime from the late 1980s also appears to have motivated Restraint 1 as economic progress became vital for regime survival. The growing opposition was fueled by economic disaffection. Since development was an important goal for the regime in order to quell domestic challenges, this made the nuclear project relatively more costly.249 This was especially so since Libya was a “rentier state”, depending on generous

Also soon after the passage of Resolution 748 imposing sanctions, Qaddafi reportedly shut down the operations of the Abu Nidal Organization in April 1992. In fact no significant act of terrorism has been associated with Libya since that time. Collins, “Dissuading State Support of Terrorism”, 14; Deeb, “Political and Economic Developments”. In another noteworthy move, Libya agreed to pay compensation for the Lockerbie incident once its role in the bombing was established (S/23918). In November 1992 Libya also conveyed its acceptance, “in principle”, of the two suspects being tried in British or American courts as individuals (S/24961).

246 Bowen, “Libya and Nuclear Proliferation”, 23. At the same time, however, the regime was concerned that nuclear reversal would be interpreted as a sign of weakness by succumbing to international pressure. Braut-Hegghammer, “Libya’s Nuclear Turnaround”, 67.

247 In fact he even went to the extent of claiming friendship with Israel through Libyan Jews in order to gain international credibility to end the sanctions. Qaddafi invited Libyan Jews all over the world to visit Libya, and in return it was claimed that Qaddafi would visit Israel. Deeb, “Political and Economic Developments”, 86. Some 192 Libyan pilgrims visited Jerusalem in 1993 in a gesture of goodwill aimed at getting the UN sanctions lifted. Joel Greenberg, “Libyans Cut Short a Visit to Israel”, New York Times, June 2, 1993.

248 Deeb, “Political and Economic Developments”, 85.

249 Braut-Hegghammer, “Libya’s Nuclear Turnaround”, 66.

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spending schemes for its legitimacy.250 Indeed the government showed a “remarkable egalitarianism” and spent lavishly on housing, education, agriculture, and industry.251 Thus although sanctions were not the principal cause of Libya’s economic travails, by the 1990s the regime came to view their removal as essential for its sustenance.252

Sanctions fueled the domestic political threats to the regime based on poor economic progress.253 Throughout his rule Qaddafi was conscious of the role of economic factors in creating popular support for his regime.254 Until the early 1980s Qaddafi was able to deflect domestic opposition (from the elite of the old monarchical regime, the conservative nationalists, the religious establishment, and the military) by creating a welfare state based on petrodollars.

However, this was increasingly difficult by the late 1980s and survival became the principal issue for the regime.255

250 Vandewalle, Libya Since Indepdendence. A rentier state is one which derives much of its revenue as rent from abroad, typically in the form of aid or export income. Libya has been considered a rentier state both under the monarchy and under Qaddafi, where the government acted as a distributor of income from leasing military bases, and from oil exports respectively. Hazem Beblawi and Giacomo Luciani, eds., The Rentier State (New York: Crook Helm, 1987).

251 Lisa Anderson, “Qadhdhafi and His Opposition”, Middle East Journal. Spring, 40 no. 2 (1986), 228; Lisa Anderson, The State and Social Transformation in Tunisia and Libya, 1830- 1980 (Princeton: Princeton University Press, 1986). This is because the legitimacy of the rentier state derived from its ability to dispense welfare benefits (Vandewalle 1998), effectively buying out traditional opposition groups. Vandewalle, Libya Since Independence; Giacomo Luciani, “Allocation vs. Production States: A Theoretical Framework” in Beblawi and Luciani, eds., The Rentier State; F. Gregory Gause III, Oil Monarchies: Domestic and Security Challenges in the Arab Gulf States (New York: Council on Foreign Relations Press, 1994).

252 Mary-Jane Deeb, “Qadhafi’s Changed Policy: Causes and Consequences”, Middle East Policy, VII no. 2 (2000), 149.

253 Qaddafi had faced challenges to his power from the early days of the regime, and had dealt with it by a combination of repression and economic co-optation. In the 1980s opposition came from the military, which staged several assassination attempts, and the middle class, which was alienated by extreme economic measures (Hinnebusch 1982).

254 There existed a strong correlation between the overall economic health of the country and the extent of domestic opposition. For example the first major coup attempt in 1975 occurred in the context of a fall in the balance of trade from a $1.8 billion surplus to a $0.5 billion deficit. Dirk J. Vandewalle, “Libya in the New Millennium”, in Vandewalle, ed., Libya Since 1969, 22.

255 Anderson, “Libya’s Qaddafi: Still in Command?”, 66

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The rise in domestic opposition was most evident since 1993 when Qaddafi’s confidante

Major Jalloud staged a failed coup attempt.256 There were several reports of assassination attempts and attacks on the government in the 1990s by disparate religious groups.257 Overall the rise in Islamic opposition made it seem that the regime was “on the verge of collapse” and this “frightened Qaddafi”.258 The basis for much of the domestic discontent was economic.259

Qaddafi responded to such domestic challenges with increasing repression compared to the 1970s when opposition was largely quelled through socialist schemes. The ‘revolutionary committees’ established in the late 1970s became an effective paramilitary force.260 In the 1990s

Qaddafi increasingly relied on members of his Qaddafa tribe for his personal security as well as in the armed forces, especially after a failed coup attempt in 1995.261 In an attempt to limit its power, Qaddafi declared the army dissolved in 1995, replacing it with popular brigades.262 Thus

256 Luis Martinez, The Libyan Paradox (New York: Columbia University Press, 2007), 97. In 1993 the Warfalla tribe attempted to capture Qaddafi at a town some hundred miles from Tripoli. Deeb, “Political and Economic Developments”. Apparently, Major Jalloud backed the scheme. It was foiled and resulted in Qaddafi calling in the air force to quell the resistance. Jalloud was demoted and placed under house arrest. Several hundred people were killed and more were arrested.

257 A group called the National Front for the Salvation of Libya carried out numerous attempts to topple the regime. In the 1990s the most prominent Islamic group was the Libyan Islamic Fighting Group which made an assassination attempt on Qaddafi in 1996. Islamist groups made another attempt in 1998, attacking Qaddafi’s convoy while returning from a trip to Egypt. The attackers succeeded in wounding him and killing three guards. Martinez, Libyan Paradox, 57.

258 Martinez, Libyan Paradox, 57; Ronen, Qaddafi’s Libya, 42.

259 Deeb, “Qadhafi’s Changed Policy”, 149. Libya’s foreign military involvements such as in Chad also caused resentment. Asteris Huliaras, “Qadhafi’s Comeback: Libya and Sub-Saharan Africa in the 1990s”, African Affairs, 100 no. 398 (2001), 9-10. Between 1973 when Libyan forces first entered Aouzou and 1987 when Libyan forces suffered a major defeat, some 3,600 Libyan troops were killed. Hussein Solomon and Gerrie Swart, “Libya’s Foreign Policy in Flux”, African Affairs, 104 no. 416 (2005), 474. Following a ruling by the Internal Court of Justice recognizing the Aouzou as part of Chad, Libyan troops withdrew in 1994 without challenging the verdict.

260 Anderson, “Libya’s Qaddafi”, 67; Martinez, Libyan Paradox, 90-91; 97.

261 El-Kikhia, Libya’s Qaddafi, 89-91.

262 Martinez, Libyan Paradox.

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domestic challenges became a serious matter for the regime in the early 1990s. This may have caused a slowing in the nuclear program due to the regime’s focus on quelling the opposition.

Conclusion: Motivational Changes in Restraint 1

In the late 1980s, the desire for nuclear weapons is believed to have strengthened following the US attacks. Hence restraint at this time was largely driven by resource constraints.

In the early 1990s, however, security threats may have led to some initial offers on nuclear rollback. The UN sanctions appear to have been critical in conveying such security threats.

However, there is no evidence to suggest that slowdown in the nuclear program at this time is attributable to these external threat perceptions. Rising domestic challenges due to poor economic conditions also preoccupied the regime. Hence it may not have prioritized the nuclear program. Ultimately, such motivational factors do not appear to have been the primary cause of

Restraint 1, which was largely the result of technology denial by suppliers.

Table 6.5 Summary of Libya’s Restraint 1 (slow) 1988

Prestige No

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Nuclear Pursuit (2) 1995-2002

In 1995 Qaddafi decided to reinvigorate the nuclear weapons program.263 Following the decision, Libya initiated contact with the Khan network to receive centrifuge technology and eventually acquired a weapons design as well.264 The network also supplied some 1.7 tons uranium hexafluoride enriched to 1% or less.265 After 1994 it restarted some limited uranium conversion experiments at the TNRC.266 As part of the renewed program, Libya partially assembled a uranium conversion facility in 1998.267

Although the nuclear weapons program made its most rapid advances in this period, this segment will consider whether sanctions in any way dampened nuclear pursuit. This entails a discussion of possible resource denial as well as motivational changes due to sanctions. As in the previous period, the relevant sanctions include both the unilateral US sanctions and mandatory UN sanctions. The analysis considers the impact of the 1999 suspension of UN sanctions on the nuclear program, arguing that it may have motivated Libya to initiate another offer of WMD rollback in 1999. As stated earlier in the chapter, Libyan intelligence chief Musa

Kusa met Clinton administration officials in Geneva, offering to end the chemical weapons

263 The decision may have been brought on by the failure to resolve the security threats of the early 1990s. Qaddafi’s attempts to resolve Lockerbie failed; as discussed below, the continuing UN sanctions were taken as an indication of possible military strikes against Libya. Moreover, approaches to the United States were unproductive. In this context, as a Libyan official has stated, abandoning the nuclear program would only make Libya more vulnerable (Braut-Hegghammer 2009). Målfrid Braut-Hegghammer, “Libya’s Nuclear Intentions: Ambition and Ambivalence”, Strategic Insights, Naval Postgraduate School, Monterey, California, VIII no. 2 (2009).

264 Bowen, “Libya and Nuclear Proliferation”, 37. In 1997 Libya received 20 L-1 centrifuges and components for another 200 centrifuges. It successfully tested its first centrifuge in October 2000. IAEA Report, February 20, 2004, 5-6.

265 The uranium hexafluoride was supplied in two cylinders, one containing natural uranium and the other depleted uranium. Fitzpatrick, ed., Nuclear Black Markets, 78.

266 IAEA Report, May 28, 2004, Annex 1, 3.

267 IAEA Report, February 20, 2004, 4.

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program.268 However, the United States rejected the overture as it was preoccupied with settling the Lockerbie issue.269

Sanctions during Pursuit (2)

The US sanctions imposed in the 1970s and 1980s continued at this time. In 1996 the

United States introduced new legislation imposing sanctions on foreign companies doing business with Libya. The Iran-Libya Sanctions Act (ILSA) called for sanctions on foreign companies making new oil-related investments of more than $40 million. The main target of the law was Iran, and Libya appears to have been added as an afterthought.270 President George W.

Bush extended the Act for another five years in 2001.

The UN sanctions were effectively enforced until the mid-1990s, being upheld by Arab and African nations as well. However the apparent intransigence of the Western nations in refusing to accept any of the many Libyan proposals for settling Lockerbie gradually weakened the legitimacy of the sanctions.271 By late 1998 the sanctions (especially the ban on air travel)

268 Corera, Shopping for Bombs, 178-179. The focus was apparently on the chemical weapons program, which was the main American concern regarding Libyan WMD. Indyk, “How Bush’s Doctrine of Pre-emption was Ambushed by Reality”.

269 Indyk, “The Iraq War Did Not Force Gadaffi’s Hand”. After the suspension of UN sanctions in 1999, the United States became more concerned that Libya was building up its offensive capabilities. Nevertheless, the focus was primarily on missile development and the chemical weapons program; the United States appears to have been unaware of Libya’s secret centrifuge effort based on supplies from the Khan network – for example, the CIA reported to Congress that the main US concerns on the Libyan nuclear program was efforts to acquire a nuclear power plant. Central Intelligence Agency, Unclassified Report to Congress on the Acquisition of Technology Relating to Weapons of Mass Destruction and Advanced Conventional Munitions, 1 January through 30 June 2001, accessed June 14, 2012, https://www.cia.gov/library/reports/archived-reports-1/jan_jun2001.htm#6

270 O’Sullivan, Shrewd Sanctions, 183; Niblock, Pariah States, 32.

271 Hurd, “The Strategic Use of Liberal Internationalism”; Niblock, Pariah States, 47-48. Throughout the 1990s Libya sought to satisfy the United States and Britain without extraditing the suspects. Just prior to the sanctions resolution in March 1992, it offered a vague proposal to hand over the suspects to the Arab League. Following Clinton’s election as US president in November 1992, Qaddafi proposed that the two accused could be tried in a third neutral country. In November 1993 Libya offered for the suspects to be tried in Switzerland. In 1994 Qaddafi proposed that the suspects stand trial in an Islamic court under Islamic law, possibly in Britain or the United States. Ronen, “The Lockerbie Endgame”. The Arab League proposed in March 1994 that the two accused be tried at the 330

were being openly violated by African leaders.272 The “bankruptcy” of the UN sanctions became evident when Britain and the United States agreed to consider trial in a special court in the Netherlands after an ICJ ruling.273 It has been argued that the US-UK decision was motivated by the desire to preserve the legitimacy of the Security Council, which was increasingly being challenged by the open flouting of the UN sanctions.274

The UN sanctions were suspended immediately after the Lockerbie suspects were surrendered in April 1999. Soon after the EU reestablished economic relations with Libya. In

July 1999 Britain restored diplomatic relations. The United States also took some preliminary steps at easing its sanctions. It permitted American oil companies to inspect Libyan oil assets and consider doing business. It also eased the travel ban.275

International Court of Justice (ICJ) at The Hague under Scottish law before Scottish judges. Niblock, Pariah States, 46. Libyan official Saad Mujber offered the proposal in March 1994 “ but it was rejected by the United States and Britain. Libya Blinks on Lockerbie”, New York Times, March 28, 1994. It is interesting to note that the Lockerbie issue was eventually settled on the basis of a format very similar to this proposal made by Libya as far back as 1994. Niblock, Pariah States, 50. (The only difference was that the trial was held under Scottish law before Scottish judges at a former US military base – Camp Zeist – in the Netherlands, rather than at The Hague.)

272 As early as June 1994 the foreign ministers of the Organization of African Unity (OAU) member countries called for sanctions to be revoked. The OAU reiterated this request at its 1997 annual meeting in Harare, Zimbabwe. By the fall of 1998 several African leaders (of Niger, Chad, Mali, CAR, Eritrea, Gambia, Uganda, and Zimbabwe) openly defied the UN sanctions by flying into Tripoli. The 1998 OAU summit called upon member states to violate the UN sanctions if the United States and Britain did not accept the Libyan proposal of trial in a third country. This was the clearest expression of a unified African voice defying the United States and Britain, and appears to have been a crucial factor in their concession for trial in the Netherlands. Huliaras, “Qadhafi’s Comeback”. Qaddafi himself started flouting the sanctions from the mid-1990s -- in April 1995 a Libyan airline flew pilgrims to Mecca. This was repeated the following year, and in June 1996 Qaddafi flew to Cairo for an Arab summit. In May 1997 Qaddafi flew a large delegation to Niger and Nigeria ostensibly for religious purposes. Ronen, “The Lockerbie Endgame”.

273 Zoubir, “The United States and Libya”, 50-51. In February 1998 the International Court of Justice (ICJ) ruled that it would hear Libya’s complaint on whether the United States and Great Britain had the legal right to demand extradition of the suspects. St. John, “Libyan Foreign Policy”, 464. The court’s ruling appeared to favor Libya, in contrast to its earlier decision that it would not hear the issue.

274 Hurd, “The Strategic Use of Liberal Internationalism”; Matar and Thabit, Lockerbie and Libya, 128.

275 Matar and Thabit, Lockerbie and Libya, 235.

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(a) Resource Denial in Pursuit (2)

Technology Denial

As in previous periods, Libya found it difficult to access nuclear technology from legitimate contacts due to its continuing reputation as a radical state. This apparently pushed it to turn to the Khan network as its main supplier in the 1990s. Libya also renewed contact with

Russia in the late 1990s.

As in the early 1990s, the UN sanctions appear to have blocked any possible supply of nuclear technology. The new nuclear transactions undertaken after sanctions were suspended in

1999 suggest that the sanctions exerted at least a deterrent effect on supplies. Indeed, the suspension of the UN sanctions appears to have facilitated access to nuclear and missile technology.276 For example, Russia renewed its contact with Libya by discussing plans to upgrade the TNRC; and in 2000 British authorities discovered missile components from a

Taiwanese company bound for Libya.277 Thus between 1995 (when Libya decided to renew the nuclear program) and 1999 (when the UN sanctions were suspended), sanctions may have contributed to difficulties accessing nuclear technology.

However, other factors such as Libya’s limited indigenous scientific infrastructure also contributed to the technological impediments faced in Pursuit (2).278 Also, some of the centrifuge-related components received from the Khan network were faulty due to the intrinsic

276 Central Intelligence Agency, Unclassified Report to Congress on the Acquisition of Technology Relating to Weapons of Mass Destruction and Advanced Conventional Munitions, 1 January through 30 June 2003, 5; Digital National Security Archive; Stephen Fidler, Mark Huband, and Roula Khalaf, “Return to the fold: How Gadaffi was persuaded to give up his nuclear goals”, Financial Times (London), January 27, 2004; Hart and Kile, “Libya’s renunciation of nuclear, biological, and chemical weapons”, 637.

277 US Department of Defense, Proliferation: Threat and Response, January 200`, 45, accessed August 10, 2011, http://www.dod.gov/pubs/ptr20010110.pdf

278 Bowen, “Libya and Nuclear Proliferation”, 44.

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nature of the black market. For example some parts of the P-2 centrifuges were damaged, while the two complete P-2 centrifuges that were delivered did not operate.279 These problems with technology acquisition had less to do with the direct impact of sanctions and more to do with the inefficiencies of the nuclear black market. Nevertheless, the sanctions had the overall effect of making it harder to acquire nuclear technology due to the outcast status they bestowed on

Libya,280 thus forcing it to turn to illicit networks.281

Financial Constraints

Financial factors do not significantly appear to have constrained the nuclear program at this time. According to American officials, Libya paid the Khan network at least $100 million for nuclear supplies since the mid-1990s.282 In the late 1990s Libya renewed negotiations with

Russia, signing an $8 million contract to refurbish the TNRC in 1998.283

Nevertheless, during Pursuit (2) the economy continued to face difficulties and was unable to return to the spectacular growth of the 1970s. Between 1992 and 1999 (when UN sanctions were suspended) the average annual growth rate for the economy was 0.8 percent.284

279 In addition, the network had substantial difficulties fulfilling the order of 20 tons uranium hexafluoride (delivering only 1.75 tons); and the drawings for weapons design were incomplete. Nuclear Programmes in the Middle East, 101-102.

280 Needless to say, Qaddafi’s personality and policies had already marked Libya as an international pariah.

281 Then Assistant Secretary for Verification Paula deSutter stated before the House International Relations Committee, “We have anecdotal evidence that sanctions had a tremendous effect, even in terms of forcing the Libyans to go to the secondary market to buy dual-use items that really were not very effective, and when you are buying things on the black market, you do not have someone to go to complain that it did not work right.” Paula DeSutter, “Completion of Verification Work in Libya”, Testimony before the Subcommittee on International Terrorism, Nonproliferation and Human Rights, September 22, 2004, http://www.state.gov/t/vci/rls/rm/2004/37220.htm

282 Matt Kelley, “US displays some of nuclear equipment seized in Libya”, Associated Press, March 15, 2004.

283 Prados, “How Qaddafi Came Clean”, 30.

284 O’Sullivan, Shrewd Sanctions, 188, 195.

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Libya’s oil income continued its fluctuating trend in the 1990s, mainly driven by prices. The sanctions appear to have indirectly impacted GDP by making it extremely difficult to replenish and maintain oil wells. In the late 1990s the US and UN sanctions had the overall effect of limiting Libya’s oil earnings, making it difficult to find replacement parts and repair oil equipment originally obtained from American companies; and problems obtaining capital equipment for refining oil and enhancing oil recovery methods.285 In addition, the sanctions affected the investment climate. In fact, the biggest impact of the UN sanctions seems to have been in propagating uncertainty about the Libyan economy.286 International disapprobation on the political front strengthened the existing perception of Libya as an unstable and unpredictable environment, thus discouraging foreign investment. Another indication of the sanctions effect is seen from the fact that the inflation rate fell after UN sanctions were suspended in 1999.287

Despite these effects, economic growth – which was driven by oil exports -- appears to have been far more affected by oil prices than by sanctions, as seen in the graph below.

285 Gurney 1996, 221-222.

286 O’Sullivan 2003, 198-199; Vandewalle 2008, 157.

287 Economist Intelligence Unit, Country Profile Libya, 2004, 33.

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Figure 6.3 Libya’s Oil Revenues in Pursuit (2)

Source: Plotted based on data from OPEC Annual Statistical Bulletin (Organization of the Petroleoum Exporting Countries, Vienna), various years, http://www.opec.org.

In any case, financial considerations do not appear to have limited nuclear pursuit in any significant way during this time, as seen from the fact that Libya paid about $100 million to the

Khan network.288

(b) Motivational Changes in Pursuit (2)

As already stated, the late 1990s and early 2000s was a period of intense nuclear pursuit with supplies arriving from the Khan network. This segment nevertheless considers whether sanctions in any way dampened the motives for nuclear weapons. It shows that domestic and external political factors led to a wavering of the nuclear commitment after 1999.

During this time of nuclear pursuit, the regime was dealing with important challenges both externally and internally. Repeated attempts to settle the Lockerbie issue made little progress; and opposition from Islamic extremists peaked in the mid-1990s. As described below, a slight decline in these challenges around 1998-1999 facilitated some initial Libyan offers of

WMD rollback. The offers were based on the expectation of ending both UN and US sanctions, and met a lukewarm response from the United States.

The year 1999 marked an important turning point for Qaddafi’s regime as the UN sanctions were suspended that year, and Libya also successfully quelled the Islamist opposition around that time. Thus the security threats to the regime both domestically and internationally declined somewhat after 1999. After UN sanctions were suspended, the leadership showed some interest in giving up WMD programs in exchange for better relations with the United States.

288 Kelley, “US displays some of nuclear equipment seized in Libya”.

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By the mid-1990s Qaddafi was facing a serious domestic crisis with the eruption of violent rebellions against his regime.289 Between 1995 and 1998 the government led a repressive campaign against Islamic groups in Cyrenaica, successfully rooting them out.290 Thus by

1999/2000 domestic opposition to the regime was “well under control”.291 Indeed greater control by the government meant that it was less concerned about a political backlash, thus facilitating the handover of the Lockerbie suspects in 1999.292 The internal challenges to the regime show the need for legitimacy even for authoritarian regimes.293 Since the domestic threats were fueled by economic concerns, lifting the sanctions became an important goal.294

Removing them became the “central goal of Libyan foreign policy for nearly a decade”.295

289 Economist Intelligence Unit, Country Report Libya, 1st quarter 1996, 14.

290 Alison Pargeter, “Libya: Reforming the impossible?”, Review of African Political Economy, 33 no. 108 (2006), 221.

291 Deeb, “Qadhafi’s Changed Policy”,146-147.

292 St. John, “Libyan Foreign Policy”, 476; Deeb, “Qadhafi’s Changed Policy”, 146, 148. Accepting Libyan responsibility for Lockerbie would have been a sign of weakness, making the regime vulnerable to military attacks as well as domestic challenges. Ronen, “The Lockerbie Endgame”, 54; Ronen, Qaddafi’s Libya; Zoubir, “The United States and Libya”, 50. Qaddafi feared the handing over the suspects would be viewed as a sign of cowardice, thus strengthening his domestic opponents and inviting an external military attack. Deeb, “Qadhafi’s Changed Policy”, 148; Matar and Thabit, Lockerbie and Libya, 74.

293 Jentleson and Whytock, “Who ‘Won’ Libya”, 55.

294 Deeb, “Qadhafi’s Changed Policy”, 149. Libya’s active efforts to avoid the further strengthening of sanctions were acknowledged by American and British officials. For example US Ambassador to the UN Madeleine Albright said, "To those who say it is not strong enough, I ask this: Why did Libya try so hard to stop this resolution if the sting of its new sanctions is so mild?" Julia Preston, “UN Council Adds Sanctions on Libya”, Washington Post, November 12, 1993. Similarly, British Foreign Secretary Robin Cook said that lifting sanctions had “become the No. one priority, obsession, of Libyan foreign policy”. Quoted in Matar and Thabit, Lockerbie and Libya, 153.

295 Hurd, “The Strategic Use of Liberal Internationalism”, 505; Braut-Hegghammer, “Libya’s Nuclear Turnaround”, 68.

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Indeed one of the conditions by the United States to start a secret dialogue with Libya in

1999 was that it ceases lobbying to lift the UN sanctions.296 Qaddafi’s keenness to settle the

Lockerbie issue is also seen in the several proposals he offered to the West.297

Once the UN sanctions were suspended in 1999, the persistent American unilateral sanctions increased the leadership’s uneasiness.298 The United States was opposed to the permanent lifting of the UN sanctions until the remaining demands were fulfilled.299 While suspending the UN sanctions likely brought the regime some relief, the fact that they had not been officially lifted indicated that Libya was not entirely off the hook on Lockerbie. The regime’s anxiety with this state of affairs is seen from its continued efforts to have the sanctions lifted. Between April 1999 when the Lockerbie suspects were surrendered and 2001, Libya wrote to the UN several times both individually and as a member of regional organizations requesting the termination of UN sanctions.300

After 1999, the threats facing the regime were somewhat reduced both externally (since it won an important political victory with the United States agreeing to the Libyan proposal on

Lockerbie) and domestically (since Qaddafi succeeded in curbing internal challenges). This

296 Indyk, “The Iraq War Did Not Force Gadaffi’s Hand”.

297 Ronen, “The Lockerbie Endgame”; Ohaegbulam, “US Measures Against Libya”, 119.

298 Ohaegbulam, “US Measures Against Libya”, 126.

299 Zoubir, “The United States and Libya”. These were accepting responsibility for Lockerbie, and paying compensation to the victims’ families.

300 Letter dated 6 July 1999 from the Permanent Representative of the Libyan Arab Jamahiriya to the United Nations addressed to the President of the Security Council, S/1999/752; Letter dated 18 November 1999 from the Permanent Representative of the Libyan Arab Jamahiriya to the United Nations addressed to the President of the Security Council, S/1999/1193; Letter dated 11 September 2000 from the Minister for Foreign Affairs of Algeria, the Minister for Foreign Affairs of Egypt, the Secretary of the General People’s Committee for Foreign Liaison and Cooperation of the Libyan Arab Jamahiriya, the Minister for Foreign Affairs of Mauritania, the Minister for Foreign Affairs of Morocco, the Minister for Foreign Affairs of the Syrian Arab Republic and the Minister for Foreign Affairs of Tunisia addressed to the President of the Security Council, S/2000/864.

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relatively strong position may have enabled Qaddafi to attempt nuclear restraint in exchange for further improvement in security. In 1999 Libyan officials reportedly approached American officials with the offer of nuclear rollback in exchange for lifting US sanctions. Qaddafi may have been motivated to seek an end to US sanctions due to a realization of the role of economic problems in bolstering domestic challenges to his government.

In conclusion, the period from the mid-1990s to 2001 was clearly marked by significant growth in the nuclear weapons program. This was primarily due to the perceived international and domestic threats to regime stability. When these threats started to recede by the late 1990s, the regime considered the possibility of nuclear rollback for the purpose of achieving an end to sanctions, which would in turn improve its external as well as domestic security. The failure of these efforts meant that Qaddafi continued nuclear pursuit until 2002 apparently as a way to

“hedge his bets”.301

Restraint 2 – (Slow and Rollback) 2002-09

The final phase of restraint began with slow growth in the nuclear program around 2002 when Libya relocated its clandestine nuclear activities, apparently for fear of detection. After testing the uranium conversion facility in February 2002, in April 2002 Libya decided to move it to a different site “for security reasons”. It dismantled and moved the facility to the new site

(Salah Eddin) between March and October 2003.302 In April 2002 it also dismantled and boxed

L-1 centrifuge cascades and moved them to a new location. They remained in boxes by the time of the 2003 decision on nuclear rollback. Since Libya could have continued to work on the

301 Corera, Shopping for Bombs, 182.

302 IAEA Report, February 20, 2004, 4.

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centrifuge cascades and possibly even introduce uranium hexafluoride for enrichment, the period between 2002 and 2003 is categorized as slow growth in the weapons effort.303

Following its announcement of the decision to rollback the nuclear program in December

2003, Libya actively cooperated with the IAEA and systematically dismantled its facilities.304 In just a month the advanced L-2 centrifuges and related documents, uranium hexafluoride, and nuclear weapons design were removed from Libya.305 By September 2004 Assistant Secretary of State for Verification Paula DeSutter stated, “we have verified with reasonable certainty that

Libya has eliminated, or has set in place the elimination of all its WMD and MTCR-class missile programs”.306 All in all, more than 1,000 tons WMD-related components and five SCUD missiles were removed from Libya.307 Libya de facto accepted the IAEA Additional Protocol starting in late December 2003.308 The protocol was officially signed in March 2004, granting authority to the IAEA to conduct more rigorous inspections at undeclared nuclear facilities. In

303 In December 2002 Libya started receiving components for L-2 centrifuges. However I categorize this period as part of slow growth in the program due to the missing parts that rendered the L-2 centrifuges inoperable as well as due to the decision to dismantle and shift the L-1 centrifuge cascades mentioned above. Moreover the delivery of L- 2 components in December 2002 was the response to an order placed earlier (September 2000) during a period of nuclear pursuit. Fitzpatrick, ed., Nuclear Black Markets, 78; Nuclear Programmes in the Middle East, 100. Finally, the L-2 components remained unopened in boxes. Nuclear Programmes in the Middle East, 103.

304 IAEA Report, May 28, 2004, 4.

305 In March 2004 a shipment of L-2 centrifuge components arrived in Libya undetected. The Libyan authorities promptly informed the IAEA, after which the materials were shipped out. IAEA Report, May 28, 2004, Annex 1, 6.

306 DeSutter, “Completion of Verification Work in Libya”. The ongoing process of elimination referred to chemical agents and missiles rather than the nuclear program, which was eliminated by September 2004.

307 Boese, “US Points to Libya as Disarmament Model”.

308 IAEA Report, February 20, 2004.

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2006 the IRT-1 research reactor and the critical assembly at TNRC were converted to run on

LEU.309

This total cooperation with the IAEA and Western countries to dismantle its nuclear weapons program continued for the first few years after the rollback decision of December

2003. All aspects of the weapons effort were eliminated by 2009. However there were some indications that the regime was unhappy or rethinking the wisdom of rollback. For example, in

June 2007 Libya cancelled an agreement with United States on chemical weapons destruction due to dissatisfaction with the financial and others terms of the agreement. In November 2009

Libya abruptly blocked the shipment of 5.2 kg of HEU in spent fuel; it approved the shipment to

Russia just a month later.310 During this time Libya also retained an interest in promoting the civilian aspects of the nuclear program, signing a nuclear cooperation agreement with France in

2007, which included a plan to eventually build a nuclear desalination plant. Thus the rollback of WMD programs after 2003 was complete but appeared to be marked by some hesitation.

Sanctions possibly affecting Restraint 2

When Libya dramatically announced its decision to give up its WMD programs in

December 2003, it continued to face US sanctions. However most of the sanctions by Europe had been lifted by this time. The UN sanctions were suspended in April 1999 immediately following the surrender of the two suspects in the Lockerbie bombing.311 They were finally

309 Fact Sheet, “GTRI (Global Threat Reduction Initiative): Reducing Nuclear Threats”, National Nuclear Security Administration, February 1, 2011, accessed April 23, 2012, http://nnsa.energy.gov/mediaroom/factsheets/reducingthreats.

310 Crail, “Chronology”.

311 Libya had already extended some cooperation to France on the UTA bombing, allowing a French judge to interrogate Libyan intelligence agents. Craig R. Whitney, “France Charges 6 Libyans With ’89 Sahara Jet Bombing”, New York Times, May 8, 1997.

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lifted in August 2003 when Libya fulfilled the remaining demands i.e. accepted responsibility for Lockerbie and paid compensation to the victims’ families.312

The US unilateral sanctions were aimed at curbing Libya’s involvement in terrorism, and not at limiting its WMD programs. They were eventually terminated after Libya decided to undertake reversal. The United States lifted travel restrictions in February 2004, allowed

American companies that had holdings in Libya before the imposition of sanctions to restart activity, and invited Libya to set up a diplomatic office in Washington DC. In April 2004 most of the remaining sanctions were removed, particularly ILSA and the trade sanctions in place since 1986. The United States dropped its objections to Libyan membership in the WTO, reestablished diplomatic relations in June 2004, and ended the national emergency with Libya in

September 2004. Direct flights were permitted in October 2004. Finally, Libya was removed from the State Department’s List of State Sponsors of Terrorism in June 2006.

Barring a few constraints on arms sales, the EU lifted all its sanctions on Libya in

October 2004.313 The EU and individual European countries had already been engaged in diplomatic and some economic relations with Libya since 1999. Like the US sanctions, the

European sanctions were also not driven by concerns about WMD programs.

Restraint 2: Motivational or Resource Driven?

Libya’s nuclear weapons program made its most rapid advances in the years just prior to

Restraint 2. Therefore the decision on nuclear rollback in December 2003 was a surprising announcement. As argued below, motivational factors were paramount, as the decision can be

312 Letter dated 20 December 1991 from the Permanent Representative of the United States of America to the United Nations addressed to the Secretary-General, S/23308.

313 Hart and Kile, “Libya’s renunciation of nuclear, biological, and chemical weapons”, 633.

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primarily attributed to changing perceptions of security threats after 9/11. Restraint 2 was also driven by some resource constraints, most notably the busting of the clandestine supply network serving the nuclear program.

The initial slowing down of the program in 2002 appears to have been motivated by the

9/11 attacks, which generated new uncertainties for the regime. After 9/11 Qaddafi moved swiftly to situate Libya on the side of the West in the war on terror. He initiated talks with the

United States and Britain on sharing intelligence regarding terrorism. This keenness to present

Libya as a respectable nation seemed to take on added urgency in light of the first nonproliferation war in Iraq, which began in March 2003. At that time Libya started talks with

Britain and the United States, discussing a possible renunciation of WMD in return for lifting sanctions.314 Qaddafi’s interest in WMD rollback as expressed in 1999 now seemed both more urgent and more attainable since the United States was interested in obtaining intelligence.315

Sanctions seemed to have played an important role in this cost-benefit calculus, as discussed below.

While the security concerns about possible repercussions for Libya after 9/11 appear to be an important motivation for rollback, Restraint 2 was also likely precipitated by the interdiction of a ship carrying nuclear components to Tripoli in October 2003. This interrupted

Libya’s main supply chain and threatened to expose the Khan network. The blocking of the

314 George Tenet, At the Center of the Storm: My Years at the CIA (New York: Harper Collins, 2007), 288.

315 It is unclear if Qaddafi intended to negotiate on the nuclear program, or whether the discussion was limited to the chemical weapons program as before (i.e. during discussions in 1999). In any case, it seems that Qaddafi had not yet made up his mind to give up chemical or nuclear weapons programs, but was ‘attempt[ing] to hedge against what was seen as a potential liability to the regime.” Robert G. Joseph, Countering WMD: The Libyan Experience (National Institute Press, 2009), 6.

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shipment constituted an important instance of resource denial in Restraint 2.316 It also likely affected motivations by signaling to the regime the futility of pursuing the program. The fact that Libya had started negotiating possible WMD rollback in March 2003 – before the interdiction of the ship – suggests that motivational considerations were relatively more important in Restraint 2. Moreover, resource denial cannot bring about nuclear rollback.317 Thus motivational changes were the principal cause of Restraint 2.

Sanctions and Restraint 2

This segment argues that sanctions were important in convincing the leadership to undertake nuclear rollback, although they were not aimed at limiting the nuclear program. When

Libya began moving toward settling Lockerbie, the United States conveyed that sanctions would only be lifted when the WMD issue was satisfied.318 The analysis shows that sanctions 952-

.contributed to nuclear restraint by exacerbating the regime’s weak power position both internally and externally. They fueled existing domestic opposition by weakening the economy; externally, they conveyed that Libya was a pariah and could therefore be subject to military action. The most significant role of sanctions was in acting as a signal of military threats. For

Qaddafi, trading the nuclear program in exchange for an end to sanctions was a way of ensuring that he was on the right side of the war on terror, thus minimizing US military threats.

316 Slow growth in the program during 2002-03 as seen in the relocation of key components was likely driven by motivational considerations alone in the aftermath of 9/11.

317 As argued in the theory chapter, resource constraints can at best stop a nuclear weapons program, but they cannot roll it back. The only exception is when physical force eliminates aspects of a nuclear program.

318 Peter Beaumont, Kamal Ahmed and Martin Bright, “Deal with Gadaffi: The meeting that brought Libya in from the cold”, The Observer (London), December 21, 2003; Flynt Leverett, “Why Libya Gave Up on the Bomb”, New York Times, January 23, 2004; Ron Suskind, “The Tyrant Who Came In From the Cold”, Washington Monthly (October 2006), accessed August 31, 2011, http://www.washingtonmonthly.com/features/2006/0610.suskind.html

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This section begins by considering possible sanctions-induced resource constraints that may have precipitated Restraint 2. It then turns to consider the motivational changes in

Qaddafi’s thinking, which as stated above were the relatively more important factor causing

Restraint 2.

(a) Resource Constraints in Restraint 2

As stated above, slow growth in the nuclear program in 2002-03 was caused by motivational factors alone. There were no obvious resource constraints at this time, when the

Khan network was supplying centrifuge components.319 In addition rollback cannot be brought about resource denial. Hence below I offer only a brief consideration of resource constraints at this time.

Technology Denial

In October 2003 there was an important instance of technology denial with an interruption in the supply of nuclear components. In a joint operation by American, British,

German and Italian authorities, a German ship BBC China carrying centrifuge equipment from

Dubai to Tripoli was intercepted off the Italian port of Taranto.320 The interception blocked the supply of these materials from the Khan network, forming an important instance of technology denial for the nuclear program. This implies that, had Libya chosen to continue the nuclear program, the enrichment effort would have been significantly slowed by the interdiction. As it happens, the operation appears to have had a far greater impact in affecting motivations (rather

319 It is true that the supplies were incomplete and some parts were damaged. However this was the case prior to 2002 as well, and therefore cannot explain the slow progress in the program during 2002-03.

320 Fitzpatrick, ed., Nuclear Black Markets, 76. The ship was diverted to the Italian port, where Italian authorities unloaded the five large containers of centrifuge parts that were on board. Joseph, Countering WMD, 41.

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than denying resources) for the program. This is discussed in the section on motivations for

Restraint 2.

Financial Constraints

After decades of poor growth, the economy showed some signs of improvement in the early 2000s fueled by rising oil prices. Thus the ability to pay for nuclear technology does not appear to have hampered the program in any way in the 2000s. The economic impact of the UN sanctions had been mitigated by the time of nuclear reversal in 2003. The UN sanctions -- which were more economically damaging than the US sanctions -- had already been suspended for four years by the time of Libya’s momentous decision. They were formally lifted in August

2003, a few months before the rollback decision of December 2003.

(b) Motivational Changes in Restraint 2

This section argues that the slowing and rolling back of the nuclear program after 2002 was principally motivated by security concerns after 9/11. The possibility of American military strikes on Libya led Qaddafi to speed up normalization through the final resolution of Lockerbie and WMD reversal.321 Libya undertook nuclear restraint with the expectation of security benefits in the form of averting a possible US military strike. In addition, the tenuous domestic political situation of previous years also seems to have persuaded Qaddafi that the economic benefits of normalization, particularly the lifting of US sanctions, would help bolster the regime.

These concerns are discussed below as the security and domestic politics models.

Security Model

321 Martinez, Libyan Paradox, 49; St. John, “Libyan Foreign Policy”, 463; Zoubir, “The United States and Libya”, 59.

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The following paragraphs discuss how the regime interpreted sanctions as conveying the threat of military attack, a viewpoint that was strengthened after 9/11. The analysis argues that

Qaddafi undertook rollback in an effort to eliminate sanctions and their associated security threats.

During this time, Libya viewed the United States as its main security threat, a perception that likely increased with the ascendance of the George W Bush administration in 2001.322 This was further strengthened with the new US foreign policy post- 9/11 and Qaddafi began to panic that his regime might become a target of US attack.323 In a speech in August 2002 he stated,

“We must comply with international legality… or we will be slaughtered”.324 Similarly, his son

Saif al-Qaddafi stated, “Libya must accept the fact that the United States is a dominant power and can use the logic of force and boycott Libya”.325 In the new global context, Libya’s nuclear program could invite an American military attack.326 The regime was also aware that its opponents in the United States were lobbying for further action against Libya.327 According to a diplomatic cable from the American Embassy in Cairo, Libya began desperately seeking Arab help “to avoid becoming a target of the anti-terrorism coalition”.328 To this end Qaddafi made a

322 US Department of Defense, Proliferation, 33; Tucker, “The Rollback of Libya’s Chemical Weapons Program”, 364.

323 Corera, Shopping for Bombs, 180.

324 Zoubir, “The United States and Libya”, 57.

325 Michel Abu-Najm, “Al-Qadhafi’s Son: Lawyers of Lockerbie Victims’ Families Want To ‘Blackmail’ Libya”, Al-Sharq al-Awsat (London), February 28, 2002.

326 Braut-Hegghammer, “Libya’s Nuclear Turnaround”, 71.

327 Zoubir, “The United States and Libya”, 57.

328 Cable from the American Embassy, Cairo to the Secretary of State, Washington, DC, “Sudan and Libya want Egyptian and other help to avoid becoming a US target”, September 20, 2001, Confidential, accessed March 8, 2011, http://www.judicialwatch.org/archive/2006/statedocqadhafi.pdf .

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“flurry of phone calls” to Arab leaders, sounding “hysterical in his telephone call to King

Abdullah, as if only the king’s personal intervention would prevent US action”.

The changed international environment after 9/11 led Qaddafi to speed up the move to normalization. As Anderson notes, “(But) September 11 really represented the moment where he [Qaddafi] saw an opportunity, because he heard loud and clear President Bush saying, “If you’re not with us, you’re with the terrorists.” He said to himself, “This is my chance to say,

‘I’m with you’.’’329 Thus Libya began sharing intelligence with the United States after 9/11, hoping to establish itself as a normal state that opposed terrorism.330 It undertook a series of steps after 9/11 that showed eagerness to be incorporated into the international community -- it immediately condemned the attacks and conveyed condolences; in late 2001 Libya signed the

CTBT and announced its intention to join the Chemical Weapons Convention, which it eventually did in January 2004; in December 2001 Libya applied for WTO membership; and in

2002 it signed the newly launched Hague Code of Conduct Against Ballistic Missile

Proliferation. The decision on nuclear rollback seemed to be the culmination of this series of steps since 2001.331 Indeed, Qaddafi’s change of heart regarding WMD is seen from the fact that as recently as 2001 he reportedly stated that Arabs had the right to possess WMD.332

329 Anderson 2003.

330 Corera 2006, 180. Libya was sharing intelligence on al-Qaeda (Tenet 2007, 288), including information on Libyans accused of links to Bin Laden; Libya was the first to issue an Interpol arrest warrant for Bin Laden (Jentleson and Whytock 2005/06, 67) as al-Qaeda was believed to have supported the Libyan opposition group LIFG (Boucek 2004).

331 Lisa Anderson, “Libyan Expert: Qaddafi, Desperate to End Libya’s Isolation, Sends a ‘Gift’ to President Bush”, Interview by Bernand Gwertzman, Council on Foreign Relations, December 22, 2003, accessed August 12, 2011, http://www.cfr.org/libya/libyan-expert-qaddafi-desperate-end-libyas-isolation-sends-gift-president-bush/p6617

332 Tenet, At the Center of the Storm.

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After the Bush administration successfully toppled the Taliban regime in Afghanistan, its attention was focused on the possible links between terrorism and WMD in Iraq. The buildup to and eventual execution of the 2003 Iraq war was an important event dominating world politics in 2002-03, and likely affected Qaddafi’s thinking.333 In any case, administration officials were making statements on the threat from ‘evil’ and ‘terrorist’ states.334 There is some evidence that

Qaddafi perceived significant military threats in the period just prior to the Iraq War.335 During negotiations with the Americans and the British begun after 9/11, Libyan officials repeatedly asked for security guarantees, and sought to glean what the West knew about their WMD programs.336 Most strikingly, the Libyan initiative to discuss WMD rollback (discussed below) began in March 2003 just at the start of the war.337 It seems that the leadership sought to escape from becoming “another Iraq” “where you had United States presence on the ground all of the time” as part of the UN inspection team.338

333 Most scholarly analyses maintain that Operation Iraqi Freedom was not a crucial factor in Qaddafi’s decision on nuclear restraint. Bowen, “Libya and Nuclear Proliferation”; Jentleson and Whytock, “Who ‘Won’ Libya”; Joffe, “Libya”; Ronald Bruce St. John, “‘Libya is Not Iraq’: Preemptive Strikes, WMD and Diplomacy”, Middle East Journal, 58 no. 3 (2004); Maria Rost Rublee, Nonproliferation Norms: Why States Choose Nuclear Restraint (Athens, Georgia: University of Georgia Press, 2009), 156; Solingen, Nuclear Logics; Zoubir, “The United States and Libya”. They cite previous Libyan offers (in the early and late 1990s) as indicative of prior interest in nuclear rollback. Moreover Libya had embarked on a path toward normalization since the 1990s, well before the onset of the 2003 Iraq war. However, this chapter maintains that although the Qaddafi regime may have made previous attempts at reversal, the events of 9/11 and the 2003 Iraq war together played a critical role in the final decision on nuclear rollback by greatly increasing the risks of continuing the program.

334 In March 2002 the Pentagon’s Nuclear Posture Review added Libya and Syria to the list of hostile countries. St. John, “‘Libya is not Iraq’”. In his testimony to the Senate Armed Services Committee, Defense Secretary Donald Rumsfeld talked of the threat from “terrorist states” including Iraq, Iran, Libya, North Korea, and Syria (Rumsfeld 2002). Undersecretary of State John Bolton also talked of Libya (as well as Cuba and Syria) as being part of an expanded list of the “axis of evil” (Bolton 2002).

335 Ronen, Qaddafi’s Libya, 62; “Iraq war swayed Gaddafi’s WMD decision”, The Strait Times (Singapore), December 24, 2004.

336 Corera, Shopping for Bombs, 184.

337 Strikingly, in March 2003 Libya also accepted ‘civil’ responsibility for the Lockerbie bombing. Jentleson and Whytock, “Who ‘Won’ Libya”, 75. It would go on to officially accept responsibility in August 2003.

338 DeSutter, “Completion of Verification Work in Libya”. 348

When asked if Libya (or Saudi Arabia or Iran) could be the next military target for the

United States, Qaddafi said:

When Bush has finished with Iraq, we’ll quickly have a clear idea of where he’s going. It won’t take long to find out if Iran, Saudi Arabia or Libya will be targets as well. At that point, US policy will be unambiguous… But if, after having occupied Iraq, he goes to Iran,… People will say to him: ‘Yesterday you just talked about Iraq. But today, you’re after Iran. Tomorrow will you try to impose your will on the whole world, one country at a time?’ At that moment, things will be clear and the rest of us will be able to face them openly.339

Indeed Qaddafi also said, “Bush isn’t logical. You can’t tell what he’s going to do. So you have to be ready for anything. Today, nobody can say: ‘I will or won’t be a target’”. He also reportedly told Prime Minister Silvio Berlusconi of Italy, “I will do whatever the Americans want, because I saw what happened in Iraq, and I was afraid”.340 Since Libya had been an enemy for the United States well before Iraq, Qaddafi likely believed that he faced a serious threat. This was especially underlined by the fact that France, Germany, and Russia were unable to prevent a US-led attack on Iraq.341 Indeed the United States reportedly sent “secret messages” to Libya that it would face international consequences if it acted similar to Saddam Hussein’s

Iraq.342 In a hearing before the House Foreign Relations Committee, members of Congress who met with Qaddafi in 2004 stated that he drew lessons from the American military presence in

339 Muammar Qaddafi, “Interview with Charles Lambroschini”, Le Figaro (Paris), March 11, 2003, accessed February 11, 2011, http://www.worldpress.org/europe/989cfm#down.

340 Robin Gedye, “UN should fight for rights, says Berlusconi”, The Telegraph, September 4, 2003.

341 Martinez, Libyan Paradox, 45.

342 Corera, Shopping for Bombs, 181-182.

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Iraq. According to House Representative Curt Weldon who travelled to Libya as part of a

Congressional delegation, Qaddafi told him, “he did not want to be a Saddam Hussein, and he did not want his people to be subjected to the military efforts that were being put forth in

Iraq”.343

Thus Libya’s prior interest in nuclear restraint as expressed in the 1990s became concretized in the new security environment after 9/11 and the Iraq war. In fact Libya had made significant progress in its nuclear program between 1999 and 2002. For example, it received components of the more advanced L-2 type centrifuges, uranium hexafluoride, and designs for a nuclear weapon from the Khan network. This progress stalled in 2002 – Libya dismantled the pilot uranium conversion facility and moved it to an alternate location due to security concerns;344 and relocated L-2 centrifuge cascades from Al Hashan to Al Fallah, again out of security considerations.345 These were part of Libyan efforts to hide the nuclear program in the context of the building rhetoric toward war in Iraq.346

After 9/11, normalization was considered imperative for the regime’s survival due to the urgency of threat perceptions. US foreign policy since 9/11 created a unique international environment whereby the nexus of terrorism and the pursuit of WMD could invite a US-led attack. These heightened threat perceptions therefore increased the relative costs of the nuclear

343 House Foreign Relations Committee 2004. Similarly then Representative Chris Chocola stated, “I heard Muammar Qaddafi say with my own ears that he did not want to follow the path of Saddam Hussein and that is why he had decided to dismantle his weapons of mass destruction and abandon supporting terrorists”. Joseph Christopher Chocola, “Qaddafi Wants to be on the Winning Side”, From Congressional Record: House, March 17, 2004, page 1121.

344 IAEA Report, February 20, 2004, 4.

345 IAEA Report, February 20, 2004, 5.

346 Olli Heinonen (former Deputy Director General, IAEA), interview by author, October 2010, Cambridge, MA.

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program.347 This effect was achieved even though the United States appears to have been largely ignorant of the advances in Libya’s nuclear program (such as its centrifuge effort and its possession of a nuclear weapons design).348 It seems that the international atmosphere in 2002-

03 was sufficient to heighten Libyan threaten perceptions, given that the United States was seen as a major threat to the regime since the 1986 attacks.349 Therefore, although the extent of

Libya’s nuclear program was largely unknown, it became a “potential liability to the regime”.350

Due to such concerns, after 9/11 Libya embarked on talks with Britain and the United States aimed at normalization. Urgency on the WMD issue clearly picked up in the context of the Iraq war, with Libyan officials offering to discuss giving up WMD just days before the war began.351

The suspension of UN sanctions in exchange for the surrender of the Lockerbie suspects made it realistic for Qaddafi to expect that he could achieve full normalization with WMD

347 Increasing insecurity has historically resulted in further nuclear proliferation rather than the reverse. For example, the 1986 American attacks deepened the regime’s desire for a nuclear deterrent. Bowen, “Libya and Nuclear Proliferation”, 21-22. Libya made a strategic decision to renew its nuclear program in 1995, apparently driven by the fear that the United States desired regime change. Braut-Hegghammer, “Libya’s Nuclear Turnaround”, 64, 67. However, the 9/11 attacks, with the prior experience of a gradual improvement in relations with the West (best expressed in the suspension of UN sanctions), made it possible for Qaddafi to expect normalization in return for rollback.

348 As late as February 2003, when Director of Central Intelligence George Tenet told Congress about “renewed concern over Libya’s interest in WMD”, he was referring mainly to Libya’s chemical weapons facility at Rabta; in 2002 Libya was not even mentioned as a significant threat for the proliferation of nuclear weapons. George J. Tenet, “Converging Dangers in a Post-9/11 World”, Testimony of Director of Central Intelligence George J. Tenet Before the Senate Select Committee on Intelligence (as prepared for delivery), February 6, 2002, accessed June 13, 2012, https://www.cia.gov/news-information/speeches-testimony/2002/senate_select_hearing_03192002.html; George J. Tenet, “The Worldwide Threat in 2003: Evolving Dangers in a Complex World”, DCI’s Worldwide Threat Briefing (as prepared for delivery), February 11, 2003, accessed June 13, 2012, https://www.cia.gov/news- information/speeches-testimony/2003/dci_speech_02112003.html. The main US concerns regarding Libya had been its role in terrorism and its chemical weapons program. Since the 1990s, the main terrorist issue was Lockerbie.

349 Cremasco 1987, 273-274; Jentleson and Whytock, “Who ‘Won’ Libya”, 58-59.

350 Joseph, Countering WMD, 6.

351 Tenet, At the Center of the Storm, 288-289; Joseph, Countering WMD, 4. As discussed below, the offer to completely end the nuclear program appears to have been closely tied to the October 2003 blocking of a shipment of centrifuge components.

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rollback. At the same time, however, Libya actively continued its nuclear program apparently as a backup in case normalization failed.352 Indeed the fear that “coming clean” on WMD would make the regime more vulnerable to external attack dominated regime actions until late 2003.353

The sanctions were seen as symbolizing military threats due to the continuation of the nuclear program. The United States conveyed that its sanctions would not be lifted until Libya satisfied it on the WMD issue.354 Thus sanctions were effective even though they were not economically devastating as in the case of Iraq because they signified other, potentially far more harmful costs.355

Domestic Politics Model

This model highlights the fact that Qaddafi’s regime had been battling internal opposition for years. Although the government successfully quashed the Islamic opposition by the late

1990s, the experience of rising threats “had clearly shaken the regime”.356 As Blanchard and

Ripsman hold, the weakness of Qaddafi’s regime made it more susceptible to sanctions.357

In addition, the leadership likely noted the difficulties in advancing the nuclear program.

Wariness of the Qaddafi regime meant that Libya had to rely on the nuclear black market for supplies; yet the network proved itself an unreliable supplier since components were faulty and

352 David E. Sanger, “In US-Libya Nuclear Deal, a Qaddafi Threat Faded Away”, New York Times, March 1, 2011; Barbara Slavin, “Libya’s rehabilitation in the works since early ‘90s”, USA Today, April 26, 2004.

353 When British PM Tony Blair telephoned Qaddafi just a day before the announcement on reversal, the latter reportedly conveyed his concern of an attack in a moment of vulnerability due to reversal. Joseph, Countering WMD, 10.

354 Zoubir, “The United States and Libya”, 62.

355 Huliaras, “Qadhafi’s Comeback”, 18; Hurd, “The Strategic Use of Liberal Internationalism”, 504-505; Zoubir, “The United States and Libya”, 55.

356 Pargeter, “Libya”, 221.

357 Blanchard and Ripsman, “A Political Theory of Economic Statecraft”, 381-382.

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incomplete.358 Libya had little to no alternative sources to turn to. By the late 1990s procurement difficulties led some officials to question the viability of the program. They called for its reassessment since the regime was battling domestic opposition largely arising from economic problems.359

From the mid-1990s there emerged a reformist faction within the Libyan government. It consisted of individuals like Ambassador to Italy Abdel Ati al-Obeidi, Ambassador the UK

Mohamed Belqasim Zwai, and the head of External Security Musa Kusa. These same individuals had conducted the Lockerbie negotiations in the late 1990s.360 This group favored better relations with the international community, while the old guard opposed domestic reforms and international normalization. Although initially neutral, by the late 1990s Qaddafi seemed to support the reformers.361 In 2000 the government sought to implement reforms by abolishing several ministries (including agriculture, education, and telecommunications).362 The internal debate between technocrat-reformers and the old guard may have been affected by Qaddafi’s desire to establish a legacy for his regime. He was grooming his second son Saif al-Islam as heir.363 Saif al-Islam was a vocal supporter of reforms and the free market.364 In June 2003

Qaddafi appointed Saif’s friend Shukri Ghanem, a “westernized technocrat”, as Prime

358 Nuclear Programmes in the Middle East, 101-102.

359 Braut-Hegghammer, “Libya’s Nuclear Turnaround”.

360 Pargeter, “Libya”, 221.

361 Solingen, Nuclear Logics, 223.

362 Bowen, “Libya and Nuclear Proliferation”, 58.

363 El-Kikhia, “Libya’s Qaddafi”, 92.

364 Pargeter, “Libya”, 222.

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Minister.365 Saif played a key role in the 2003 negotiations to give up WMD. Thus the move to nuclear rollback was facilitated by the rise of the reformist faction within the Libyan regime.

The figure towering over decision-making in Libya, however, was its mercurial leader

Qaddafi. It would be a mistake to simply write him off as ‘crazy’, inconsistent, irrational, or irrelevant.366 Three key personality traits likely affected Qaddafi’s decision on rapprochement with the West. Personal safety was his fundamental concern – he had a “basic distrust of virtually all those around him”.367 He moved from place to place to avoid assassination.368

Secondly, like many other “rogue state” leaders, Qaddafi displayed a curious mix of opposition to Western powers as well as the desire to be accepted by them.369 He wanted acknowledgement of his importance from the United States in particular.370 Finally, Qaddafi was pragmatic and responded to opportunity when it presented itself.371 Driven by the ultimate goal of personal and regime survival, Qaddafi did not hesitate to change past policies. His foreign policy throughout the three decades of power bear testimony to his ability to repeatedly alter alliances based on the

365 Pargeter, “Libya”, 223.

366 El-Kikhia, “Libya’s Qaddafi”, 89.

367 Harris, Libya, 72.

368 A cable from the American Embassy in Tripoli states that he was “almost obsessively dependent on a small core of trusted personnel.” Cable from US Embassy, Tripoli to Secretary of State, Washington DC, A Glimpse into Qadhafi’s Eccentricities, 29 September 2009, Secret/Noforn, Tripoli 000771; Wikileaks, accessed September 8, 2011.

369 Harris, Libya, 100.

370 St John, Libya and the United States, 10, 145.

371 Harris, Libya, 54-56.

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changing balance of power environment.372 Indeed, his “impulsive” policies came to be characterized by an “unpredictable turnabout”.373

The combination of external pressure (via sanctions and military threats) and internal challenges led the regime to conclude that its nuclear program had become a liability. Qaddafi stated – “Any nation state that adopts this policy [of WMD] cannot protect itself; instead it would expose itself to danger”.374 Qaddafi has stated that Libya abandoned its WMD programs as they were not beneficial.375 He may have concluded that nuclear rollback would benefit him through the expected lifting of US sanctions, which would in turn give a new lease of life to the sagging Libyan economy.

Sanctions and the Security and Domestic Models

The UN suspended sanctions in 1999, immediately after the Lockerbie suspects were surrendered for trial. However according to the terms of UN resolutions, sanctions were to be terminated only when Libya cooperated fully in the investigations (for both Lockerbie and the bombing of the UTA flight), accepted responsibility, and paid appropriate compensation.

The United States made it clear that its unilateral sanctions would not be lifted unless

Libya ended its WMD programs.376 Indeed the final settlement of Lockerbie involving a compensation package for victims’ families and Libya’s acceptance of responsibility occurred in

372 Deeb, Libya’s Foreign Policy.

373 Martin Sicker, The Making of a Pariah State: The Adventurist Politics of Muammar Qaddafi (New York: Praeger), 55.

374 “WMD too risky, warns Gaddafi”, Agence-France Press, March 1, 2004, The Australian.

375 Cable from US Liaison Office, Tripoli to Secretary of State, Washington DC, 31 August 2005, Secret, Wikileaks, accessed September 7, 2011.

376 Steven R. Weisman, “US Will Keep Penalties Against Libya, Officials Say”, New York Time, August 15, 2003.

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August 2003, after the talks on WMD reversal had been initiated.377 Thus the last outstanding issues justifying the American sanctions were being removed one by one – compensation and accepting responsibility for Lockerbie,378 and stopping the pursuit of WMD. Both of these were driven by the desire to end sanctions – the Lockerbie compensation led to the termination of the

UN sanctions; 379 nuclear rollback was undertaken in the expectation of the removal of US sanctions.380

The final act of nuclear rollback therefore appears to have been motivated by the desire to end US sanctions. The role of sanctions can also be gleaned from the final compensation package for Lockerbie – Libya agreed to pay $4 million per family when the UN sanctions were lifted, another $4 million when the American sanctions were terminated, and the remaining $2 million when it was removed from the US list of state sponsors of terrorism.381 It is interesting to observe that the unilateral US sanctions played such a crucial role in this context although, as had already been established, they were not economically devastating to Libya. This was

377 This final settlement of the Lockerbie issue seems to have been facilitated by the additional incentives for both Libya and the United States to resolve it. Libya was keen to prove itself as a respectable global actor; the United States was apparently ready to join Europe and others in reducing its condemnation of Libya. Besides, American oil companies were eager to enter the country. Matar and Thabit, Lockerbie and Libya, 234-236.

378 Even after Libya agreed to pay compensation and accepted responsibility for the bombing, the United States had other issues of concerns including human rights, external military interventions, and WMD programs. Peter Slevin, “Libya Accepts Blame in Lockerbie Bombing”, Washington Post, August 17, 2003.

379 Weisman, “US Will Keep Penalties Against Libya”. The UN sanctions had been suspended since 1999 but were not officially ended until August 2003.

380 There is no public evidence of a quid pro quo in return for rollback; it appears to be based simply on the understanding that Libya would have better relations with the United States, which would not seek regime change. Jentleson and Whytock, “Who ‘Won’ Libya”, 74.

381 Ronen, Qaddafi’s Libya, 60.

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because the sanctions had a tremendous political impact in successfully isolating Libya and its leadership.382

The 2003 Decision

The final decision on nuclear rollback was made possible by intense meetings of Libyan officials with British and American counterparts on a variety of topics (mainly Lockerbie and terrorism) related to Libyan normalization in the international system. As early as October 2001 the head of the Libyan intelligence services Musa Kusa met with British officials in London, showing “a seismic shift in relations between Libya and the outside world”.383 Musa Kusa met with the CIA’s deputy director of counter-terrorism, Ben Bonke, at the London home of the

Saudi Ambassador to the United States Prince Bandar Bin Sultan.384 Meetings between the two sides continued for the next couple of years, covering a variety of issues especially Lockerbie but also WMD.385 The main focus of the discussions was intelligence on al-Qaeda.386 American officials reportedly conveyed that the UN and US sanctions would be lifted only after settling

Lockerbie and dismantling WMD programs.387 When British Foreign Office minister Mike

382 O’Sullivan, Shrewd Sanctions, 218.

383 Beaumont et al, “Deal With Gadaffi”.

384 Suskind, “The Tyrant Who Came In From the Cold”.

385 Joffé, “Libya”, 223.

386 Tenet, At the Center of the Storm, 288. It is unclear precisely when the nuclear program specifically entered the negotiations, specifically, whether it was discussed prior to the October 2003 interdiction of centrifuge materials. It seems that the interdiction was critical in persuading rollback on the nuclear program -- American and British intelligence officials presented evidence of the centrifuge program just days after the shipment was blocked, leading to a rapid confession on the extent of Libya’s nuclear program. Joseph, Countering WMD, 6-7.

387 Beaumont et al, “Deal With Gadaffi”; Suskind, “The Tyrant Who Came In From the Cold”; Leverett, “Why Libya Gave Up On The Bomb”.

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O’Brien visited Tripoli in August 2002, Qaddafi apparently reassured him that Libya would cooperate on the WMD issue.388 O’Brien felt that Qaddafi was serious on giving up WMD.389 In

September 2002 Tony Blair reportedly wrote to the Libyan leader stating his concerns on

Libya’s WMD programs.390

In March 2003 Libyan officials contacted Britain’s intelligence services with a

“willingness” to end its WMD programs in exchange for lifting US sanctions.391 Nevertheless it appears that the leadership had not yet “made a final decision to give up its programmes”.392 It is reported that Qaddafi’s son Saif-al Islam led the initiative.393 Between March and September

2003 British and Libyan intelligence officials met several times in London, Geneva, and

Tripoli.394 The October 2003 interdiction of a ship carrying centrifuge components to Tripoli was a major development leading to nuclear rollback.395 It appears to have powerfully conveyed to the Libyan leadership that it would be nearly impossible to build a nuclear weapons capability without being caught.396 In doing so, it likely heightened threat perceptions regarding a possible

388 Joffé, “Libya”, 223.

389 Corera, Shopping for Bombs, 180.

390 Fidler et al, “Return to the fold”.

391 George J. Tenet, “Challenges in a Changing Global Context”, Testimony of the Director of Central Intelligence before the Senate Armed Services Committee, As prepared for delivery. March 9, 2004, accessed September 1, 2011, https://www.cia.gov/news-information/speeches-testimony/2004/tenet_testimony_03092004.html; Joseph, Countering WMD, 5-6.

392 Fidler et al, “Return to the fold”; Joseph, Countering WMD, 15.

393 Joseph, Countering WMD, 5; Tucker 2009, 364.

394 Tucker, “The Rollback of Libya’s Chemical Weapons Program”, 365.

395 Condoleezza Rice, No Higher Honor: A Memoir of My Years in Washington (New York: Crown Publishers, 2011), 249.

396 In reality, it seems that American officials were not aware of Libya’s advances in centrifuge technology at least until the interdiction in October 2003.

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US attack.397 Just two weeks after the interdiction, a joint British-American team conducted a technical visit to Libya’s WMD and missile facilities.398

The negotiations in 2003 were not easy – the Libyans were concerned that they would be penalized if they revealed too much.399 They were very reluctant to admit having WMD programs even at later stages of the negotiations.400 The United States and Britain reassured the

Libyan government that it would be rewarded rather than punished for revealing past WMD programs, and that the potential benefit of rollback was the expectation of normalization through such measures as the termination of US sanctions and formal end to UN sanctions.401

While the ‘carrot’ of normalization was offered, the ‘stick’ of an unspoken threat of military intervention was more ambiguous.402 The negotiations were effective because of clarity in the demand as well as the associated reward and punishment.403

397 Indeed, then Special Assistant to the President and key official in the Libyan negotiations, Robert Joseph notes that in the absence of the interdiction, “Libya may have decided to give up some capabilities, such as its chemical weapons program” and that “it is unlikely that it would have agreed to the removal of all elements of its nuclear program or its longer-range missiles” Joseph, Countering WMD, 12-13, emphasis added.

398 Joseph, Countering WMD, 7.

399 Corera, Shopping for Bombs, 185.

400 Joseph, Countering WMD, 15.

401 Joseph, Countering WMD, 59-60; Pargeter, “Libya”, 219.

402 Corera, Shopping for Bombs, 181-182.

403 Joseph, Countering WMD, 9. This was a continuation of the approach adopted for settling the Lockerbie issue, where Security Council Resolution 883 (which strengthened the sanctions on Libya) contained direct reference to the suspension of sanctions when the accused Libyans accepted trial, and the lifting of sanctions when Libya paid appropriate compensation (Resolution 883, paragraph 16).

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Table 6.6 Summary of Libya’s Restraint 2 (slow and rollback) 2002-2009

Causes of restraint Present? Resource Constraints: Techological No Did sanctions impose significant resource constraints on NW Financial No program? Motivational Changes: Security Yes Did sanctions induce motivational changes in NW program? Domestic Politics Yes

Prestige No

Conclusion

The Libyan decision on nuclear rollback was part of a broader effort to normalize, a key goal being the lifting of sanctions. This move toward normalization was in turn the result of external as well as domestic pressures. The chapter has shown that the role of sanctions lay primarily in increasing these pressures on the regime. As discussed here, sanctions were most effective in motivating restraint rather than in denying technology. They conveyed external security threats and exacerbated domestic challenges. Ultimately, rollback was undertaken in the expectation that these threats would recede.

The analysis has delineated another phase of nuclear restraint in the late 1980s and early

1990s, driven principally by the lack of access to nuclear technology. From the early 1990s,

Qaddafi’s regime also displayed a tendency to offer WMD rollback in exchange for improved security vis-à-vis the West. The UN sanctions played a critical role in generating perceptions of insecurity, precipitating such offers of rollback. The analysis highlights the impact of some external events on threat perceptions, most notably the 1991 and 2003 wars against Iraq.

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As shown in the details of the negotiations leading up to the decision on nuclear rollback,

Libya was motivated by the expectation of an end to US sanctions. Yet it is evident that the US sanctions did not exert a powerful economic impact at the time. This suggests that the political implications of the sanctions were far more powerful for the regime, which perceived a connection between sanctions and the possibility of US military strikes. This shows that it is not necessary for sanctions to be economically devastating404 in order to be influential. In this way, the analysis differs from existing accounts of the Libyan decision by arguing that sanctions acted as a signal of military threats.

The regime wanted the termination of the UN sanctions at least from the time they were imposed in 1992;405 the desire to stop the US sanctions may have become a goal in the late

1990s. The US sanctions were the proximate cause of nuclear reversal as seen from the fact that the only quid pro quo Libya asked for and received was their termination.406 The lifting of the

US sanctions was used by both sides as a signal of the eventual normalization of bilateral relations. Finally, the multilateral nature of the UN sanctions facilitated a bargaining framework wherein the Libyan regime could expect that its actions would be met with reciprocity.

404 Although the UN sanctions on Libya were some of the most stringent sanctions ever imposed by that body, they were much more limited in scope than those on Iraq during the same period.

405 The UN sanctions from the beginning appear to have generated an interest in WMD reversal – the first offer of rollback was made the same year (1992). At any rate, the UN sanctions set in motion a process that eventually led to the resolution of Lockerbie as well as WMD reversal. Bowen, “Libya and Nuclear Proliferation”, 17, 23.

406 It seems that some Libyan officials expected more substantial economic benefits. For example, the speaker of parliament Al-Zinati Muhammad al-Zinati expected that Libya would receive economic compensation for WMD reversal similar to the former Soviet states. Al-Zinati, “Libyan Parliament Secretary on Rapprochement with US”, Interview with Al-Zinati, Al-Majallah (London), January 18, 2004. Qaddafi has also stated that Libya was not adequately rewarded, asking the United States for defensive weapons and a demonstration of the peaceful uses of nuclear technology such as a desalination plant or power plant. Cable from US Liaison Office, Tripoli to Secretary of State, Washington DC, August 31, 2005, Secret, Wikileaks, accessed September 7, 2011; Cable from US Embassy, Tripoli to Secretary of State, Washington DC, May 8, 2008, Secret/Noforn, Tripoli 000374, Wikileaks, accessed September 7, 2011. However the United States made no commitments on direct economic or other benefits, except a move toward normalization. DeSutter, “Completion of Verification Work in Libya”.

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Sanctions thus played the critical role of conveying the right amount of threat – credible, but not overwhelming.

Libya’s nuclear rollback presents a rare instance where the same leader both started and ended the program. In this sense, Qaddafi’s image of eccentricity may have facilitated the rollback decision, which Tony Blair characterized as showing “courage”.407 The case also depicts the domestic pressures experienced even by a dictatorship, and the willingness of such a regime to undertake restraint in order to maintain its power.408 It also represents an exception to the general observation that sanctions are more effective against democracies rather than autocracies.409

Table 6.7 Final summary of Libya’s nuclear restraint

Did Sanctions impose significant Did Sanction induce Restraint Resource Constraints on Motivational Changes in NW program? NW program? Restraint 1: Slow (mid-1980s to No No mid-1990s)

Restraint 2: Slow and Rollback No Yes (2002-2009)

407 “Full Transcript: Blair’s Libya Statement”, BBC News, December 19, 2003, accessed September 15, 2011, http://news.bbc.co.uk/2/hi/uk_news/politics/3336073.stm.

408 Jentleson and Whytock, “Who ‘Won’ Libya”, 55.

409 Cortright and Lopez , Economic Sanctions; Nooruddin, “Modeling Selection Bias”; Marinov, “Do Economic Sanctions Destabilize Country Leaders?”.

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CHAPTER 7

IRAN

Iran has an advanced nuclear program that covers key aspects of the fuel cycle. It strongly denies accusations of pursuing nuclear weapons capability, a charge that has resulted in the imposition of UN sanctions since 2006. For nearly its entire period as the Islamic Republic, established in 1979, Iran has faced incrementally increasing unilateral US sanctions. This chapter argues that sanctions have had mixed effects on Iran’s nuclear program. They have had partial success in denying resources as well as some limited impact in persuading nuclear restraint. Yet they have failed to induce nuclear rollback i.e. the dismantling of projects with implications for weaponization.

At times, such as in the 1980s, sanctions denied technology that would have helped develop the program. However the principal reason for such technological constraints has been

US pressure on nuclear suppliers rather than sanctions. There is no evidence that sanctions have significantly limited financial resources for the nuclear program. Sanctions achieved a noteworthy success in one key instance by affecting motivations for the nuclear program. In

2003-05, motivated by the threat of UN sanctions, Iran undertook the significant measures of suspending some enrichment-related activities and implementing the Additional Protocol.

Nevertheless, the maximum that sanctions were able to achieve at this time was the slowing down of the program, and not its stopping or rollback.

The chapter begins with a summary of Iran’s nuclear program, including the major motives driving key decisions. After identifying two phases of nuclear restraint (Restraint 1 in

1979-1983, and Restraint 2 in 2003-05), it assesses the role of sanctions in periods of pursuit as well as restraint.

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The Nuclear Program

Iran’s nuclear energy program began in the 1950s with extensive US assistance and picked up momentum in the 1970s. It stalled after the Islamic Revolution of 1979, which was soon followed by a bloody war with Iraq. Iran renewed the nuclear program after the death of the supreme leader Ayatollah Khomeini in 1989, expanding its civilian and military applications.1 Russia, China, and the A. Q. Khan network became the major suppliers in the

1990s.

The most dramatic advances in the program were made since the late 1990s and today

Iran has the full range of the ‘front end’ of the fuel cycle from uranium mining and milling, to conversion, enrichment, fuel fabrication, and the associated reactors, as well as related R&D.2

Its centrifuge enrichment program is advanced, with a capability to enrich uranium to 20% U-

235. Many of these activities were not appropriately reported to the IAEA; these omissions were later rectified.3 Iran has always maintained that it does not have a weapons program. However in

November 2011 the IAEA reported that Iran had a structured nuclear weapons program until

2003, and that some activities related to weaponization continued after that.4 The following

1 Mark Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities: A Net Assessment, Strategic Dossier (London: International Institute for Strategic Studies, 2011), 12.

2 International Atomic Energy Agency, Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Report by the IAEA Director General, November 10, 2003, GOV/2003/75, paragraph 8.

3 In 2004 the IAEA listed a total of 14 counts of violations of the safeguards agreement classified as: (a) six failures on reporting uranium imports and their use, (b) two failures to declare facilities, (c) six failures to give updated design information, and (d) obstructing inspections through concealment. International Atomic Energy Agency, Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran, Report by the IAEA Director General, November 15, 2004, GOV/2004/83, paragraph 86. Although these omissions were largely rectified by 2005, other actions by Iran has fueled the ongoing concern about possible weaponization – the 2009 revelation of a secret pilot enrichment facility; emerging evidence of weaponization activity; and the jump in enrichment levels from less than 5% to almost 20% in 2010.

4 International Atomic Energy Agency, Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions in the Islamic Republic of Iran, Report by the IAEA Director General, November 8, 2011, GOV/2011/65, 8. Nevertheless it did not state any significant new evidence of a nuclear weapons program. 364

pages discuss the origins and motivations of the program, categorized into different phases of nuclear pursuit and restraint.

Table 7.1 Iran’s Nuclear Program

Years Nuclear Pursuit/ Restraint 1950s- 1979 Nuclear Pursuit 1979-1982/83 Nuclear Restraint 1 (Stop) 1984-2003 Nuclear Pursuit 2003-2005 Nuclear Restraint 2 (Slow) 2006-2010 Nuclear Pursuit

The nuclear program began under monarch Shah Reza Pahlavi5 in the 1950s with assistance from the United States under the Atoms for Peace program. At the time it was geared to peaceful purposes and was centered at the Tehran University Nuclear Research Center

(TNRC). In 1967 Iran started operating a 5 MW light-water reactor obtained from the United

States called the Tehran Research Reactor (TRR) at the TNRC. The United States supplied 93% enriched uranium fuel for the reactor, an indication that it was not concerned about possible weaponization.6 Iran signed the NPT in 1968 and ratified it in 1970. Its full-scope safeguards

The Agency’s harsher stance toward Iran is believed to be a reflection of Director General (since 2009) Yukiya Amano’s sympathies with the US position. Seymour M. Hersh, “Iran and the IAEA”, The New Yorker, November 18, 2011.

5 Iran was ruled by Shah Mohammed Reza Pahlavi from 1941 to 1979.

6 Fuel enriched to 90% or higher levels of U-235 is considered weapons-grade as it is suitable to develop weapons. Before the Revolution the United States apparently supplied about 5 kg weapons-grade fuel, which is today stored as spent fuel under IAEA safeguards. Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 78; Christina Walrond, “Timeline 1967-1993: Argentine Low-Enriched Uranium at Tehran Research Reactor”, October 7, 2009 (Washington, D.C.: Institute for Science and International Security, 2009), accessed September 19, 2011, http://www.isisnucleariran.org/assets/pdf/Tehran_reactor_timeline.pdf. In 1993 the TRR was reconfigured with Argentine assistance to run on 20% enriched uranium fuel. Argentina also supplied 115 kg of fuel enriched to almost 20%. International Atomic Energy Agency, Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions in the Islamic Republic of Iran. Report by the IAEA Director General, February 25, 2011, GOV/2011/7, footnote 12; Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 78.

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agreement with the IAEA entered into force in 1974.7 The TRR and a small critical assembly at

Esfahan operated under IAEA safeguards.8 Although nuclear cooperation with the United States continued until the late 1970s,9 some limits were placed due to emerging concerns that Iran could seek a weapons capability.10

The nuclear program accelerated in the mid-1970s, driven by the desire to achieve energy self-sufficiency11 as well as to have a nuclear weapons option.12 The 1976 French deal to supply a large reactor (‘Osirak’) and HEU fuel to Iran’s long-standing rival Iraq reportedly generated much concern in Iran.13 The strengthening of the nuclear program was also supported by an important supply-side factor -- the sudden increase in oil revenues following the 1973 oil

7 IAEA Report, February 25, 2011, footnote 1.

8 Shannon N. Kile, “Nuclear arms control, non-proliferation, and ballistic missile defense”, SIPRI Yearbook 2003 (Stockholm: SIPRI, 2003), 597, footnote 109.

9 For example the Chairman of the US Atomic Energy Commission visited Tehran in 1974 to study the possibility of establishing enrichment and reprocessing facilities. In 1975 the two countries signed a major agreement to build eight nuclear reactors. Mustafa Kibaroglu, “Good for the Shah, Banned for the Mullahs: The West and Iran’s Quest for Nuclear Power”, Middle East Journal. Spring. 60 no. 2 (2006), 214.

10 In the mid-1970s there were US intelligence reports of Iranian interest in a nuclear weapons program. Paul K. Kerr, “Iran’s Nuclear Program: Status”, CRS Report for Congress, December 29, 2009, 1. The Carter administration cancelled planned American assistance to Iran on reprocessing and enrichment. Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 9. American assistance in supplying eight new reactors was also obstructed by concerns about Iranian interest in reprocessing technology. These concerns emerged between 1974 and 1977. David Albright and Andrea Stricker, “Iran’s Nuclear Program” in Robin Wright, ed., The Iran Primer: Power, Politics, and US Policy (Washington, D.C.: United States Institute of Peace, 2010), http://iranprimer.usip.org/resource/irans-nuclear-program; “Nuclear History: Nuclear Iran” (Washington, D.C.: Institute for Science and International Security), accessed January 7, 2011, http://www.isisnucleariran.org/nuclear- history/.

11 The Shah was apparently concerned about depleting oil reserves (considered to run out in twenty years) coupled with the demands of a growing economy and rising population. Akbar Etemad, “Iran” in Harald Muller, ed., A European Non-Proliferation Policy: Prospects and Problems (Oxford: Clarendon Press, 1987), 210.

12 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 48.

13 Weissman and Krosney, Islamic Bomb, 237. The Shah was also reportedly disconcerted by India’s nuclear test in 1974. Haleh Vaziri, “Iran’s Nuclear Quest: Motivations and Consequences” in Raju G. C. Thomas, ed., The Nuclear Non-Proliferation Regime: Prospects for the 21st Century (New York: St. Martin’s Press, Inc., 1998), 311.

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crisis.14 The Shah planned to build 22 nuclear power reactors in twenty years as well as develop other parts of the fuel cycle including uranium exploration, enrichment,15 and reprocessing capabilities.16 He set up the Atomic Energy Organization of Iran (AEOI) in 1974 led by Dr.

Akbar Etemad, a physicist trained in Switzerland. Iran also planned to build several reactors with assistance from Germany, France, and the United States,17 and negotiated contracts with them for the supply for LEU fuel for ten years.18 The Shah started research on laser isotopic separation in the 1970s in both AVLIS and MLIS techniques.19 He is believed to have had ambitions for developing nuclear weapons.20 Thus, although in its early stages, the nuclear program was in full swing – “the most ambitious in the Middle East” -- when the Islamic revolution overthrew the Shah in 1979.21

14 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 7, 8-9; Kibaroglu, “Good for the Shah, Banned for the Mullahs”, 213-214. Iran’s oil revenues increased tremendously from 1970 onwards under new arrangements with oil companies. In 1973 the Shah nationalized the oil consortium, allowing Iran to gain substantial profits in the aftermath of the October 1973 Arab-Israeli war and its consequent oil embargo, which Iran did not participate in (Pollack 2004, 106-107). Kenneth M. Pollack, The Persian Puzzle: The Conflict Between Iran and America (New York: Random House, 2004), 106-107.

15 Research in laser enrichment was started in the 1970s.

16 Gaukhar Mukhatzhanova, “Pride and Prejudice: Understanding Iran’s Nuclear Progra” in Potter, ed., Forecasting Nuclear, Volume 2, 43.

17 It signed contracts with Kraftwork Union (KWU), a subsidiary of the German company Siemens, to build two 1,300 MW reactors at Bushehr, construction on which began in 1975 (IAEA Country Profiles). Iran also signed an agreement with the French firm Framatome to build two 900 MWe light water reactors at Darkhovin. Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 9. Negotiations to receive eight reactors from the United States were ongoing.

18 Vaziri, “Iran’s Nuclear Quest”, 311.

19 Contracts for obtaining laser technology stalled in the 1970s either due to inherent difficulties with the technology or were abandoned after the revolution. A 1975 contract to receive a laser spectroscopy laboratory was abandoned in the 1980s as the lab functioned poorly. In 1976 Iran entered into an agreement with the United States to establish a facility to study MLIS enrichment technology. This agreement fizzled out after the 1979 revolution. IAEA Report, November 10, 2003; IAEA Report, November 15, 2007.

20 Vaziri, “Iran’s Nuclear Quest”, 311-312.

21 Spector and Smith, Nuclear Ambitions, 203.

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The program underwent its first phase of nuclear restraint (Restraint 1) in the years immediately following the revolution. The new leader Ayatollah Khomeini ordered the suspension of the nuclear program since he opposed western collaboration and technologies, and reportedly viewed it as un-Islamic.22 Aside from this important decline in motivations, several supply-side factors also slowed down the nuclear program. First, foreign suppliers were reluctant to carry through with existing contracts after the revolution.23 Construction at Bushehr was suspended and plans for other reactors were cancelled. After the revolution the United

States stopped its supply of HEU fuel for the Tehran Research Reactor (TRR).24 Second, many scientists and technical experts fled the country – the staff of the AEOI fell from about 4,500 scientists to just 800.25 Finally, the sudden onset of the war with Iraq in 1980 interrupted the nuclear program.26 Thus the nuclear program experienced a clear phase of restraint in this period

22 Chris Quillen, “Iranian Nuclear Weapons Policy: Past, Present, and Possible Future”, Middle East Review of International Affairs, 6 no. 2, 2002, 19; Caroline F. Ziemke, “The National Myth and Strategic Personality of Iran: A Counterproliferation Perspective” in Victor A. Utgoff, ed., The Coming Crisis: Nuclear Proliferation, US Interests, and World Order (Cambridge: MIT Press, 2000), 111.

23 Some cooperation with France continued in the form of technical assistance and supply of equipment on uranium conversion. In 1981 a French company even agreed to provide a uranium conversion laboratory. Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 48, 52.

24 However the Tehran Nuclear Research Center continued to operate, training specialists and conducting experiments at the TRR (Spector 1988, 220).

25 Corera, Shopping for Bombs, 61.

26 In September 1980 Saddam Hussein’s Iraq launched a surprise attack on Iran. The Islamic Republic responded with determination although it was militarily weak as its army had been purged and its weaponry in a state of disrepair. The war dragged on for eight years, involving the Iraqi use of chemical weapons, and killing a total of about 400,000 Iranians. Daniel Byman, Shahram Chubin, Anoushiravan Enteshami, and Jerrold Green, Iran’s Security Policy in the Post-Revolutionary Era (RAND, 2001), 29. It remains the single biggest influence on Iran’s security calculus. Shahram Chubin, Iran’s Nuclear Ambitions (Washington, DC: Carnegie Endowment for International Peace, 2006), 18. Although the war ended in a ceasefire, Iran views it as a defeat and attributes this significantly to American arms and material support for Iraq. Saira Khan, Iran and Nuclear Weapons: Protracted Conflict and Proliferation (New York: Routledge, 2010), 71; Pollack, Persian Puzzle, 208. Besides preoccupation with the war effort, another factor that contributed to Restraint at this time was the damage to the Bushehr reactors during the war. Greg J. Gerardi and Maryam Aharinejad, “An Assessment of Iran’s Nuclear Facilities: A Report”, Nonproliferation Review, 2 no. 3 (1995) Spector and Smith, Nuclear Ambitions, 204.

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immediately following the Revolution from 1979 to about 1982/83. Although the program has since faced several setbacks, this is the only phase when it halted.27

Interest in the nuclear program revived in the early 1980s, involving R&D as well as efforts to complete the Bushehr reactors.28 This new interest seems to have been driven by the ongoing war with Iraq,29 together with a growing energy crisis.30 A nascent interest in a nuclear weapons option may have emerged at this time, where the leadership perceived its deterrent value against foreign invasion.31 Around 1984 the regime attempted to complete construction at the nuclear power plants at Bushehr.32 In 1983-84 it established the Esfahan Nuclear

Technology Center entailing laboratory facilities for uranium conversion and fuel fabrication.33

The Esfahan Center is said to have become the hub of the alleged nuclear weapons pursuit.34

From around the mid-1980s the leadership began to perceive a deterrent value from the nuclear program. The Iraqi use of chemical weapons -- which became rampant by 1983 --

27 The program grinded to a complete halt with the exceptions of limited cooperation with French companies on uranium conversion technology to set up the Esfahan Nuclear Technology Center, and some ongoing research activities at the TNRC.

28 According to a CIA Report, the nuclear program was renewed in 1982. Central Intelligence Agency, Middle East- South Asia: Nuclear Handbook (Directorate of Intelligence, 1988), accessed September 2, 2011, http://www.foia.cia.gov/docs/DOC_0001033097/DOC_0001033097.pdf, 25.

29 President Khamenei apparently announced in April 1984 that the supreme leader Khomeini “decided to reactivate the nuclear program as the only way to secure the very essence of the Islamic Revolution from the schemes of its enemies, especially the United States and Israel”. Albright, Peddling Peril, 71.

30 Albright and Stricker, “Iran’s Nuclear Program”; Kibaroglu, “Good for the Shah, Banned for the Mullahs”, 216; Etemad, “Iran”, 214.

31 Albright and Stricker, “Iran’s Nuclear Program”.

32 Spector, Undeclared Bomb, 219-220. However the KWU refused to complete the contract, presumably under US pressure. Kibaroglu, “Good for the Shah, Banned for the Mullahs”, 216.

33 The Shah’s regime had negotiated with several French firms in the mid-1970s for setting up the center. Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 52.

34 Richelson, Spying on the Bomb, 503.

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convinced Iranian leaders on the need for a nuclear deterrent.35 It may have motivated the launch of a centrifuge enrichment program in the mid-1980s.36 An oft-quoted portion of a speech by then speaker of parliament Akbar Hashemi-Rafsanjani describes the Iranian perspective well:

With regard to chemical, bacteriological, and radiological weapons training, it was made very clear during the war that these weapons are very decisive. It was also made clear that the moral teachings of the world are not very effective when war reaches a serious stage and the world does not respect its own resolutions and closes its eyes to the violations and all the aggressions which are committed in the battlefield. We should fully equip ourselves both in the offensive and defensive use of chemical, bacteriological, and radiological weapons.37

Thus a conscious interest in nuclear weapons development as a deterrent for national security emerged during the war with Iraq.38

American intelligence assessments of Iranian interest in nuclear weapons came out into the political arena most forcefully in a 1992 testimony of the director of intelligence Robert

35 Sanam Vakil, “The Persian Dilemma: Will Iran Go Nuclear?”, Current History, 104 no. 681 (2005), 184. Iranians were aghast that the international community was largely indifferent to the plight of the Iranians. Ray Takeyh, Hidden Iran: Paradox and Power in the Islamic Republic (New York: Council on Foreign Relations, 2006), 142-143; Bradley L. Bowman, “The ‘Demand-Side’: Avoiding a Nuclear-Armed Iran”, Orbis, 52 no. 4 (2008). Iraq’s use of chemical weapons reportedly had 50,000 casualties. Cirincione et al, Deadly Arsenals (2005), 308. Iran had complained at the UN and even sent to European nations 50 individuals with chemical weapons injuries, but was largely greeted by apathy. Javed Ali, “Chemical Weapons and the Iran-Iraq War: A Case Study in Noncompliance”, Nonproliferation Review, 8 no. 1 (2001), 48.

36 Mark Fitzpatrick, “The Iranian Nuclear Crisis: Avoiding worst-case outcomes”, Adelphi Paper 398, (London: International Institute for Strategic Studies, 2008), 14. The details of the centrifuge program are given below.

37 Rafsanjani, October 1988, quoted in Cirincione et al, Deadly Arsenal (2005), 298.

38 Bowman, “The ‘Demand-Side’”, 631-632.

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Gates that Iran was trying to obtain a nuclear weapon.39 To diffuse these accusations, Iran voluntarily allowed the IAEA to conduct additional inspections in 1992 and 1993. These found no evidence of activities related to nuclear weapons development.

Despite renewed efforts, the approach to several countries for nuclear assistance

(including Pakistan, Argentina, Spain, China, and Czechoslovakia) largely failed in the 1980s.40

According to Iran the repeated failures to get international commercial assistance led it to explore uranium enrichment on the black market i.e. the A Q Khan network.41

In the early 1990s Iran imported various forms of natural uranium from China, including uranium hexafluoride, the feed material for centrifuge enrichment.42 In addition, it sought to produce this nuclear material indigenously by importing uranium conversion technology from

China in the 1980s.43 Iran produced various forms of uranium, including uranium hexafluoride, in laboratory experiments at the TNRC.44 It also entered into a contract to receive a turnkey uranium conversion facility (UCF) from China in the 1990s. However the contract was cancelled in 1997, apparently under US pressure,45 after Iran received a blueprint design.46 In

39 Richelson, Spying on the Bomb, 506.

40 Kibaroglu, “Good for the Shah, Bad for the Mullahs”, 217. Iran did have some limited cooperation with Pakistan, China, and Argentina in the 1980s, but other efforts failed. For example in 1982 Iran approached KWU to rebuild Bushehr but was apparently turned down due to the ongoing war. Fitzpatrick, ed, Iran’s Nuclear, Chemical, and Biological Capabilities, 11. Iran also unsuccessfully approached companies from Argentina, France, Germany, and Spain to help rebuild the reactors. IAEA Report, November 15, 2007, 2.

41 IAEA Report, November 15, 2007.

42 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 13; IAEA Report, November 15, 2007.

43 IAEA Report, November 15, 2007.

44 Conversion experiments producing uranium hexafluoride occurred between 1987 and 1993. IAEA Report, November 15, 2004.

45 . The United States and China entered into an agreement in 1997, under which the United States agreed to supply civilian nuclear exports. Fitzpatrick, ed, Iran’s Nuclear, Chemical, and Biological Capabilities, 8, 13, 54.

46 IAEA Report, November 10, 2003. 371

1999 Iran began constructing a uranium conversion facility at Esfahan and declared it to the

IAEA in 2000.47 It began conversion tests using uranium ore concentrate in March 2004, producing limited amounts of uranium hexafluoride by November 2004,48 when it agreed to suspend conversion and enrichment programs. Following the Paris Agreement of November

2004 stipulating such suspension (described below), Iran did not produce uranium hexafluoride until August 2005.

Iran also started constructing a fuel manufacturing plant at Esfahan in 2004.49 In early

2009 the plant was producing fuel rods for a heavy water reactor being constructed at Arak. It has not yet started producing fuel for the TRR.50

Iran received “several hot cells” from the United States in 1967 located at the TNRC in which it is believed to have carried out plutonium reprocessing experiments.51 Between 1988 and 1993 Iran irradiated 7 kg uranium dioxide targets at the TRR and separated 100 milligrams

47 In addition to producing uranium hexafluoride (feed material for uranium enrichment at Natanz) from yellowcake, the facility is also planned to be capable of producing uranium dioxide (to be used as fuel for research reactors) and uranium metal (for laser enrichment).

48 International Atomic Energy Agency, Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran, Report by the IAEA Director General, September 2, 2005, GOV/2005/67; IAEA Report, November 15, 2004;

49 The plant is to produce fuel for a heavy water reactor being built at Arak, the Bushehr nuclear energy plant, and the TRR. International Atomic Energy Agency, Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions in the Islamic Republic of Iran, Report by the IAEA Director General, September 6, 2010, 7; International Atomic Energy Agency (IAEA), Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran, Report by the IAEA Director General, June 6, 2003, GOV/2003/40. Although it is envisaged to produce LEU, the plant has generated proliferation concerns as Iran is to receive fuel for the Bushehr reactor from Russia for ten years. Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 80-81.

50 International Atomic Energy Agency (IAEA), Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions in the Islamic Republic of Iran, Report by the IAEA Director General, September 2, 2011, GOV/2011/54, 7

51 Anthony H. Cordesman and Adam C. Seitz, Iranian Weapons of Mass Destruction: The Birth of a Regional Nuclear Arms Race (Washington, DC: Praeger Security International, 2009), 220. Hot cells have thick radiation walls, allowing enough plutonium to be extracted for a small No. of nuclear weapons. They are used in conjunction with glove boxes, which are transparent sealed containers where special materials can be manipulated. Such precautions must be taken since plutonium is very radioactive and hazardous (fas.org).

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of plutonium in three shielded glove boxes at the TNRC.52 Iran stated that this stopped when the glove boxes were dismantled in 1992 and stored at the Esfahan Nuclear Technology Center in

2000.53 However it later told the Agency that it did conduct plutonium reprocessing experiments in the late 1990s.54 As far as known to the IAEA, there are no reprocessing activities today.55

In the 1990s the nuclear program strengthened with deeper threat perceptions. The 1991

US-led war against Iraq showed both the regional and nuclear ambitions of Saddam Hussein, as well as US willingness to use its superior military force to dominate the Persian Gulf.56 The

American victory over brought US forces to Iran’s backyard, spurring the nuclear program.57

Thus Iraq and the United States came to constitute the biggest security threats for Iran. It was also evident that the United States was actively seeking to prevent Iran’s acquisition of any kind of nuclear technology.58

52 Cirincione et al, Deadly Arsenals (2005), 302.

53 IAEA Report, November 10, 2003, 6; Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 82.

54 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 82.

55 International Atomic Energy Agency (IAEA), Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions in the Islamic Republic of Iran, Report by the IAEA Director General, February 25, 2011, GOV/2011/7, paragraph 25. Iran’s reprocessing capability is not a major proliferation concern as it does not yet have a large enough reactor to reprocess sufficient plutonium for a nuclear weapon. Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 82.

56 Vaziri, “Iran’s Nuclear Quest”, 318.

57 Trita Parsi, Treacherous Alliance: The Secret Dealings of Iran, Israel, and the United States (New Haven: Yale University Press, 2007), 143; Khan, Iran and Nuclear Weapons, 81; Kenneth R. Timmerman, Countdown to Crisis: The Coming Nuclear Showdown with Iran (New York: Crown Forum, 2005), 100; Manocher Dorraj, “Behind Iran’s Nuclear Pursuit?”, Peace Review: A Journal of Social Justice, 18 no. 3 (2006). The United States has been considered an important enemy of the Islamic Republic from the beginning of its establishment. The Shah, who had become increasing autocratic, had been supported by the United States. Mutual suspicion between the two countries was sealed with the American hostage crisis of 1979-1981.

58 Indeed the contrast between the US policy of providing nuclear ‘carrots’ to North Korea in the mid-1990s versus American pressure on Russia to cancel the Bushehr deal was striking. Ferial Ara Saeed, Redefining Success: Applying Lessons in Nuclear Diplomacy from North Korea to Iran, Strategic Perspectives 1 (Center for Strategic Research, Institute for National Strategic Studies, National Defense University, 2010), 25, accessed May 22, 2012, http://www.ndu.edu/inss/docuploaded/strategicperspectives_saeed.pdf.

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In the mid-1990s the AEOI reportedly began constructing a heavy water production plant near Arak with assistance from Russian companies. It started operating in August 2004.59 The

IAEA was not allowed to access the plant between 2005 and August 2011. Iran has stated that it produced 60 tons heavy water at the plant.60 Again apparently with some Russian help,61 Iran started constructing a 40 MW thermal reactor called the Iran Nuclear Research Reactor or IR-40 at Arak in 2004.62 It is based on an indigenous design.63 The plant is an important proliferation concern as it can generate weapons-grade plutonium to produce one or two nuclear weapons per year.64 The reactor is expected to start operating in 2013 but this may be hampered by difficulties with foreign assistance.65 Iran has not allowed the IAEA access to the facility but is not required to do so under its safeguards agreement.66

The IAEA first learned of Iran’s centrifuge program in 2002, when an exiled opposition group revealed the Natanz facility (as well as heavy water plant at Arak) at a press conference in

Washington DC. Iran allowed inspections at Natanz in 2003. According to Iran, failure to obtain international commercial assistance on the nuclear program led to the decision to launch a

59 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 80.

60 IAEA Report, September 2, 2011, 6.

61 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 15.

62 Cordesman and Seitz, Iranian Weapons of Mass Destruction.

63 IAEA Report, August 26, 2003.

64 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 80.

65 IAEA Report, February 25, 2011, paragraph 29. A Russian company that was supposed to provide metal components for the reactor cancelled its deal in 2008 following the imposition of UN sanctions. Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 80.

66 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 80.

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centrifuge program at the TNRC in 1985.67 It seems that the AEOI might have been motivated partly due to its limited success with laser enrichment and partly due to the better possibilities of hiding a centrifuge program.68 The early centrifuge program apparently entailed a staff of just three persons and remained limited due to mismanagement and technical problems.69 In 1987

Iran obtained from the Khan network a few basic elements such as P-1 centrifuge drawings and samples of components.70

Starting in 1994 it received drawings and components for some 500 P-1 centrifuges and a full set of P-2 centrifuge drawings.71 Iran stopped its meetings with the network in 1999, perhaps because of concerns of costs and poor quality,72 or because it had already received all the necessary elements.73 After successfully testing P-1 centrifuges in the late 1990s, Iran decided to launch a large-scale centrifuge enrichment plant at Natanz.74 Personnel and scientific constraints apparently prevented any progress in P-2 development until 2002.75 Iran is

67 IAEA Report, August 26, 2003, 6; IAEA Report, November 15, 2007, 2.

68 Albright, Peddling Peril, 72.

69 IAEA Report, November 15, 2007, 3; Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 11.

70 IAEA Report, August 26, 2003, 6.

71 IAEA Report, September 2, 2005; IAEA Report, November 15, 2007, 4.

72 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 70. Accounts of how much the Iranians paid the Khan network for this deal include $3 million and between $5 and 10 million. Albright, Peddling Peril, 78; Corera, Shopping for Bombs, 69.

73 Corera, Shopping for Bombs, 70.

74 IAEA Report, November 15, 2007, 4. Iran began successfully testing the P-1 centrifuge at Kalaye Electric Company (an AEOI-owned company on the suburbs of Tehran) in the late 1990s. Although initially stating that fissile material was not used in the tests, it later admitted that imported uranium hexafluoride was introduced in 1999 and 2002. Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 16. IAEA Report, August 26, 2003, 7; IAEA Report, November 10, 2003, 6. In the spring of 2003 the centrifuge equipment at Kalaye was dismantled and stored until October 2003 when it was moved to Natanz and revealed to the IAEA.

75 IAEA Report, November 15, 2004, 83, 10-11; IAEA Report, November 15, 2007, 4.

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developing other centrifuge designs, many of which are based on the P-2 design, which uses maraging steel.76

In 2001 Iran secretly began constructing a centrifuge enrichment facility at Natanz, entailing a pilot plant intended to have 1,000 centrifuges, and a much bigger underground plant to hold 50,000 centrifuges, which IAEA Director General Mohammed ElBaradei described as

“stunning”.77 After undertaking some limited enrichment to less than 5% at the pilot plant, in

2010 Iran dramatically succeeded in enriching uranium to nearly 20%. This marked an important milestone in fuel cycle capability.

The commercial-scale plant at Natanz is surrounded by multiple layered thick walls, presumably for protection against airstrikes.78 It started operating in February 2007.79 The IAEA has found that enrichment at this plant has generally not exceeded the declared 5% level.80

Around 2006-07 Iran also started building another secret pilot centrifuge plant at Fordow near Qom. Iran revealed this plant in September 2009 apparently because it gleaned that the

West was aware of it.81 The plant is located inside a mountain near an IRGC82 base and is heavily fortified. It is planned to have 3,000 centrifuges. In June 2011 Iran announced that the

76 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 61. As part of the centrifuge program Iran had acquired specialized materials like maraging steel and high strength aluminum from abroad in the late 1990s. IAEA Report, November 15, 2007, 4.

77 ElBaradei, Age of Deception, 114. IAEA Report, June 6, 2003, 6.

78 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 65. Albright notes that at one point the construction required all the cement in Iran. Albright, Peddling Peril, 186.

79 IAEA Report, February 28, 2010, 2.

80 IAEA Report, February 18, 2010, 2; IAEA Report, September 6, 2010.

81 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 66.

82 The Iranian Revolutionary Guards Corps (IRGC) is a central component of the Islamic Republic of Iran and is believed to control the nuclear program. It is a military branch set up by Khomeini to defend the revolution, and continues to exert a dominant influence in the economic and strategic decisions of the country. The IRGC is discussed in more detail later in the chapter. 376

20% level of enrichment was being transferred from the pilot plant at Natanz to the Fordow plant, and installed one such cascade by August 2011.83

From the 1990s onwards the United States has maintained that Iran was seeking a nuclear weapons capability.84 Such allegations spiked in 2005 when American officials revealed to the IAEA the acquisition of a laptop computer from Iran containing work related to the design of a nuclear weapon. The evidence appeared to show that Iran was seeking to develop a compact nuclear weapon as a payload for its Shahab missile.85 In 2011 the IAEA reported that

Iran had conducted, and possibly was continuing, activities related to nuclear weapons development.

The activities of initial concern to the IAEA were: the green salt project to convert uranium dioxide into uranium tetrafluoride (or green salt),86 high explosives testing, and the design of a missile re-entry vehicle.87 The IAEA was also concerned about experiments with

Polonium-210, but it declared this matter closed by February 2008.88 The second major set of issues revolved around high voltage firing equipment and detonators, an underground testing

83 IAEA Report, September 2, 2011, 4.

84 In 1992 Director of Central Intelligence Robert Gates testified that Iran was trying to obtain a nuclear weapon. Richelson, Spying on the Bomb, 506. Iran voluntarily allowed the IAEA to conduct additional inspections in the early 1990s but these found no evidence of nuclear weapons activities.

85 William J. Broad and David E. Sanger, “Relying on Computer, US Seeks to Prove Iran’s Nuclear Aims, New York Times, November 13, 2005. It was later reported that the source and the evidence was tenuous. Seymour M. Hersh, “Annals of National Security: The Iran Plans”, The New Yorker, April 17, 2006.

86 Under the green salt project, the IAEA obtained documents that showed a planned capacity to produce 1 ton uranium tetraflouride annually. IAEA Report, February 22, 2008. Uranium tetraflouride can be used to produce uranium metal, a necessary component for weaponization (or to produce uranium hexafluoride, the feed material for enrichment). Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 86.

87 IAEA Report, February 27, 2006.

88 Although it has civilian applications, polonium can be used in some designs of nuclear weapons. IAEA Report, September 2, 2005. Iran had stated that the TNRC had conducted research experiments involving Polonium-210 in the 1980s as part of general research activities, and that it had been aborted after the project leader left the country. IAEA Report, February 22, 2008, paragraphs 21-22.

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arrangement, and developing a spherical implosion system that could be used to develop an implosion nuclear weapon.89 The work on high explosives testing was allegedly conducted in a large military facility at Parchin just outside Tehran.90 A document discovered in 2005 discussed casting uranium metal into hemispheres.91 The IAEA also sought clarifications on alleged work to redesign the inner cone of the Shahab-3 missile re-entry vehicle to accommodate a nuclear weapon.92

In addition the Agency wanted to learn more about the role of military officials in the nuclear program, and of some military-related organizations such as the Physics Research

Center, Institute of Applied Physics, and the Education Research Institute.93

Iran has responded that it does not have a nuclear weapons program, and that the evidence obtained by the IAEA is fabricated. In its February 2010 report – the first under the new Director General Yukiya Amano -- the IAEA stated in much stronger terms its concerns about the possibility of a nuclear weapons program.94 These matters remain unresolved, as Iran has not discussed them with the IAEA since August 2008.

In the 2000s Iran began making rapid advances in its centrifuge program, constructing a secret large-scale underground facility at Natanz. In the midst of this effort, Iran undertook a phase of nuclear restraint in 2003-05 (Restraint 2) when it suspended some enrichment and

89 IAEA Report, May 26, 2008; IAEA Report, February 18, 2010.

90 Shannon N. Kile, “Nuclear Arms Control and Non-Proliferation”, SIPRI Yearbook 2005: World Armaments and Disarmament (Stockholm: SIPRI, 2005), 560.

91 An implosion weapon entails a sphere, which could be made of two hemispheres. Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 87.

92 IAEA Report, May 26, 2008.

93 IAEA Report, May 26, 2008. The Physics Research Center at Lavizan-Shian was run by the Ministry of Defense. The site was razed before the IAEA was allowed access. Kile, “Nuclear Arms Control” (2005), 560.

94 IAEA Report, February 18, 2010, paragraph 9.

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conversion activities, and implemented the Additional Protocol.95 The chapter categorizes this as a period of slow growth in the nuclear program since it was decidedly slower than Iran’s technical capabilities would allow. This phase of restraint was precipitated by the dramatic revelation of two secret nuclear facilities at Natanz and Arak by an Iranian exiled opposition group.96

Iran’s decision to suspend enrichment and conversion was part of an understanding with the E-3 (Britain, France, and Germany) in October 2003. In the Tehran Agreed Statement, Iran declared it would “voluntarily suspend uranium enrichment and reprocessing activities as defined by the IAEA”.97 Such a voluntary suspension is especially significant, as enrichment had just begun at the pilot plant at Natanz. Iran also agreed to implement and sign the

Additional Protocol immediately. In return it could expect that the E3 would block referral to the Security Council so long as Iran abided by these new commitments.98 In November 2004 the

E3 and Iran signed the Paris Agreement based on a stricter definition of suspension to include the manufacture, assembly, installation, and testing/ operation of centrifuges and centrifuge components as well as tests or production at any uranium conversion facility.99

95 The Additional Protocol was created by the Agency around 1997 in the context of the advanced clandestine nuclear weapons program of Iraq, and difficulties of conducting inspections there. The Protocol aimed to overcome the main limitation of the Agency, which was constrained to inspect only the sites declared by member states ElBaradei, Age of Deception, 116. The Additional Protocol authorized the IAEA to conduct inspections at undeclared sites on short notice.

96 It is speculated that the opposition group, NCRI, may have received intelligence from Western sources ElBaradei, Age of Deception, 112, footnote 1; Cavarelli 2011, 101.

97 “Tehran Agreed Statement”, Statement by the Iranian Government and Visiting EU Foreign Ministers, October 21, 2003, accessed January 27, 2011, http://www.iaea.org/newscenter/focus/iaeairan/statement_iran21102003.shtml. Specifically, it committed to “suspend all activities on the site of Natanz, not to produce feed material for enrichment processes and not to import enrichment related items”. IAEA Report, November 10, 2003, paragraph 19.

98 “Tehran Agreed Statement”, paragraph 3c.

99 “Paris Agreement”, Iran-EU Agreement on Nuclear Programme, November 14, 2004, accessed January 27, 2011, http://www.iaea.org/newcenter/focus/iaeairan/eu_iran14112004.shtml.

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The chapter argues that this phase of restraint was driven principally by security threats generated in the context of the 2003 war in Iraq. During this time the United States was regarded as the principal threat to Iran’s national and regime security.100 America’s easy defeat of Saddam Hussein’s regime in 2003 conveyed the formidable consequences of American military power, and suggested that Saddam Hussein’s chemical weapons were insufficient to deter the United States.101 Iranian officials feared that their country could be the next military target for America.102

The understanding of the Paris Agreement began to unravel in the spring of 2005. The E3 demanded that Iran permanently stop uranium enrichment activities, while Iran held that its enrichment suspension was purely voluntary.103 Restraint 2 ended when Iran resumed uranium conversion in summer 2005, followed by enrichment activity in spring 2006. The IAEA Board immediately reported Iran to the Security Council for non-compliance of the NPT. This marked a new stage, with the Council imposing four rounds of sanctions on Iran between 2006 and

2010. It demanded that Iran suspend enrichment and reprocessing activities.

Despite some aspects of slow growth,104 the nuclear program has not displayed a significant phase of restraint since 2005. After 2005 the centrifuge program grew significantly

100 Shahram Chubin, Iran’s Nuclear Ambitions (Washington, DC: Carnegie Endowment for International Peace, 2006), 14; Khan; Takeyh 2003.

101 Parsi, Treacherous Alliance, 243; Takeyh, Hidden Iran, 145; Khan, Iran and Nuclear Weapons, 102; Manocher Dorraj, “Behind Iran’s Nuclear Pursuit?”.

102 Bowman, “The ‘Demand-Side’”, 633.

103 Iranian officials had thought that the Paris Agreement signified that the Europeans had abandoned the demand of permanent enrichment suspension. Fitzpatrick, Iranian Nuclear Crisis, 24.

104 For example in the summer of 2006, enrichment activity at the pilot plant at Natanz proceeded slowly. ElBaradei, Age of Deception, 197. Around 2009-2010 the nuclear program appeared to slow down in the face of some technical hurdles as well as a series of assassinations against top scientists associated with the program. A computer worm named Stuxnet, which is said to be the work of the American and Israeli governments, is believed 380

and by 2010 Iran achieved the capability to enrich uranium to 20%. Thus Iran attained an important part of the fuel cycle, putting it close to a weapons capability.

Renewed nuclear pursuit since 2005 appears to have been motivated by ongoing security concerns, which were also closely related to prestige as Iran experienced international isolation.105 A nuclear weapons capability would be a powerful assertion of Iran’s sovereignty by demonstrating its independence and technological prowess.106 It would also bolster its quest for regional power status.107

Restraint 1 (Stop) 1979-1983

The first phase of restraint in Iran’s nuclear program occurred soon after the establishment of the Islamic Republic in 1979. Immediately, the major nuclear power projects at

Bushehr and Darkhovin were abandoned.108 Many scientists and technical experts also fled the country following the revolution.109 By 1980 the United States stopped its supply of HEU

to have critically affected centrifuge enrichment activities. David E. Sanger, “Iran Moves to Shelter Its Nuclear Fuel Program”, New York Times, September 1, 2011.

105 Takeyh, Hidden Iran, 146; Jerrold D. Green, Frederic Wehrey, and Charles Wolf, Jr, Understanding Iran (RAND: National Security Research Division, 2009); Jalil Roshandel, “Iran’s Populist President, Strategic Foreign and Nuclear Policy: The Influence of Domestic Politics on the Current Iranian Nuclear Stand-off” in Michel Korinman and John Laughland, eds., Shia Power: Next Target Iran? (Portland: Vallentine Mitchell Academic, 2007), 141.

106 Fitzpatrick, The Iranian Nuclear Crisis, 14.

107 Kayhan Barzegar, “Roles at Odds: The Roots of Increased Iran-US Tension in the Post-9/11 Middle East”, Iranian Review of Foreign Affairs, 1 no. 3 (2010), 97.

108 Construction by KWU of two partially completed power plants at Bushehr stopped; and plans for the French to supply two nuclear power reactors at Darkhovin were cancelled. Spector 1988, Undeclared Bomb, 219. Both Iran and the suppliers seem to have lost interest after the establishment of the Islamic Republic. Some accounts maintain that Iran cancelled the contracts, while others hold that the KWU abandoned the project after the revolution or after the start of the Iran-Iraq war in 1980. Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 80; “Nuclear History”, ISIS; Andrew Koch and Jeanette Wolf, “Iran’s Nuclear Facilities: A Profile”, Center for Nonproliferation Studies, accessed January 25, 2011, http://cns.miis.edu/reports/pdfs/iranrpt.pdf; Mukhatzhanova, “Pride and Prejudice”, 43.

109 Spector, Undeclared Bomb, 219.

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fuel.110 In addition, the fuel supply arrangements with France and Germany were also suspended. Although research activities continued at the TNRC, I classify this as a period when the nuclear program stopped since fuel cycle activity was not being pursued.111

Restraint 1: Motivational or Resource Driven?

The halting of the nuclear program after the Islamic Revolution appears to have been driven by both motivational and supply-side factors. One motivational factor related to the proclivities of the new regime, as well as the political flux surrounding its establishment.112 The new leader Ayatollah Khomeini reportedly opposed nuclear technology for moral reasons.113

Constraints from the supply-side occurred in three ways. First, thousands of Iranian scientists fled abroad in the confusion after the revolution.114 Second, nuclear suppliers abandoned or cancelled ongoing as well as planned contracts for nuclear technology. Western firms were presumably uneasy after the events surrounding the revolution such as the hostage crisis, and the overthrow of the Shah, who was strongly supported by the United States. Finally, resources were concentrated in the war with Iraq that began in September 1980. Moreover Iraq directly attacked the Bushehr reactors several times.

While both motivational and resource related factors were at play, the latter may have been relatively more influential in Restraint 1. For example, Iran failed in its attempt to

110 www.isisnucleariran.org.

111 Spector, Undeclared Bomb, 220. One key exception is that Iran signed a contract with a French firm for a uranium conversion laboratory in 1981. However it did not start conversion experiments until 1983; hence this phase is categorized as restraint. Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 52.

112 The dissertation categorizes change of domestic regimes as a ‘motivational’ factor within the domestic politics model.

113 Quillen, “Iranian Nuclear Weapons Policy”, 19.

114 Corera, Shopping for Bombs, 61; Solingen, Nuclear Logics, 177.

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complete the Bushehr power project, an effort that appears to have begun as early as 1982 due to considerations about sunk costs.115 This suggests that, even if the regime had sought to continue the entire nuclear program, technology denial would probably have led to Restraint 1.

Indeed, developments since the mid-1980s seem to bear out this observation, as Iran’s repeated attempts to acquire nuclear technology met with failure. Moreover, it is unclear if Ayatollah

Khomeini every declared a fatwa against nuclear weapons or simply stated that nuclear technology was “un-Islamic”.116 There is also some evidence that at least one leader favored nuclear weapons development soon after the revolution. In May 1979 Ayatollah Mohammad

Beheshti, a close advisor of Khomeini, reportedly approached a Shah-era energy official to suggest nuclear weapons development.117 This suggests the absence of a clear-cut internal consensus against nuclear technology. Finally, it is evident that the nuclear program would have experienced some internal technical limitations even if the new regime had attempted to continue it – due to the loss of scientific personnel and other resources following the revolution.

Thus resource constraints may have been relatively more important than motivational factors in

Restraint 1. The analysis in this section nevertheless considers the possible impact of sanctions in both resource denial and motivational changes.

Sanctions possibly affecting Restraint 1

The United States imposed a series of sanctions following the takeover of hostages at the

American Embassy in Tehran in November 1979. The United States immediately closed the

115 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 11.

116 Judith S. Yaphe and Charles D. Lutes, “Re-assessing the Implications of a Nuclear-armed Iran”, McNair Paper 69 (Washington, DC: Institute for National Strategic Studies, National Defense University, 2005), 10-11, accessed June 25, 2012, http://www.ndu.edu/inss/docuploaded/McNair69.pdf.

117 Behesthi was assassinated in 1980, one of numerous attacks that were part of the internal struggle for power following the revolution. Vaziri, “Iran’s Nuclear Quest”, 314.

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embassy in Tehran and severed diplomatic relations, which have not been re-established till today. Other sanctions included an arms embargo, a ban on Iranian imports, and the freezing of

Iranian assets in the United States -- amounting to $12 billion, – which was regarded as

“unprecedented”.118 In April 1980 the United States banned all trade and travel excepting humanitarian aid. These US sanctions remained the most significant sanctions against Iran as

American efforts to pass UN sanctions were stumped by the Soviet veto.119 The economic sanctions were imposed solely for the goal of releasing the American hostages and were consequently lifted in January 1981 with the conclusion of the Algiers Accord, under which the

United States agreed to terminate the trade sanctions in exchange for the release of the hostages.120

The United States achieved only partial success in persuading its European and Asian allies to impose sanctions on Iran. The European Community (EC) and Japan imposed an arms embargo, decreased oil imports, and suspended extending new credit to Iran in 1980.121 Canada banned all trade with Iran in 1980.122 Like the US sanctions, these sets of sanctions were also lifted in early 1981.123

118 Christian Emery, “The transatlantic and cold war dynamics of Iran sanctions”, Cold War History, 10 no. 3 (2010), 372; Patrick Clawson, “US Sanctions” in Wright, ed., Iran Primer.

119 In any case the Europeans were worried that economic devastation would give the Soviet Union greater leverage over Iran. Robert Carswell, “Economic Sanctions and the Iran Experience”, Foreign Affairs, 60 no. 2 (1981/1982), 253.

120 Some Iranian assets continued to remain frozen, but they were mostly freed as also trade transactions that resumed. O’Sullivan, Shrewd Sanctions, 48-49.

121 O’Sullivan, Shrewd Sanctions, 48; Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM.

122 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM.

123 Hooman Estelami, “A Study of Iran’s Responses to US Economic Sanctions”, Middle East Review of International Affairs, 3 no. 3 (1999), 52.

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Sanctions and Restraint 1

As discussed above, Restraint 1 was brought about by both resource denial and motivational changes. This section argues that sanctions were not influential in either route, and that the denial of nuclear technology to Iran in this period was largely the result of wariness of the new regime and American pressure on suppliers.

(a) Resource Constraints in Restraint 1

Technology Denial

Nuclear restraint during 1979-1983 was facilitated by supply-side factors – suppliers pulled out of existing contracts, Iranian scientists fled abroad, and the sudden onset of war with

Iraq made it physically impossible to pursue the program. To what extent were these supply-side factors brought about by sanctions? Clearly, neither the flight of Iranian scientists nor the onset of the Iran-Iraq war a result of sanctions. Sanctions were also not the primary reason for the cancellations of nuclear contracts, which was largely caused by international wariness about the new Islamic regime.

Supply-side factors had the potential to drastically affect the direction of Iran’s nuclear program since it was “completely dependent” on outside assistance.124 Even by the late 1980s securing foreign assistance was the biggest stumbling block to the program.125 Soon after the revolution the KWU withdrew from the Bushehr project, with one reactor 85% complete and the

124 CIA Briefing Papers, 28 April 1976, 16, National Archives at College Park.

125 Central Intelligence Agency, Directorate of Intelligence, Middle East- South Asia: Nuclear Handbook (1988), accessed September 26, 2011, 27, http://www.foia.cia.gov/docs/DOC_0001033097/DOC_0001033097.pdf.

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other 50% complete.126 In 1982 Iran approached KWU to restart work on the reactors, but was refused probably due to American pressure.127

In this period the primary sanctions on Iran were US sanctions from November 1979 to

January 1981, imposed for the purpose of releasing the American hostages. This automatically entailed a suspension of existing American nuclear assistance. This meant that technology and materials that would otherwise have been made available were denied. These included the supply of HEU fuel for the TRR and new projects for different aspects of the fuel cycle.128

Had the new regime desired to continue the nuclear program, it would have found it difficult to obtain American help. Thus at least while the hostage crisis continued till January 1981, it is unlikely that Iran could have obtained Western technological assistance. Technological denial was, however, not due to specific sanctions but was rather the result of Western wariness of the new Islamic Republic.129

Financial Constraints

Immediately after the revolution Iran was in a state of turmoil as various political factions vied with one another for dominance. The economy experienced several problems, some of which, like high inflation and unemployment, were holdovers from the Shah’s era. The new regime adopted populist measures, characterized by heavy state involvement in the economy

126 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 80.

127 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 11; Kibraoglu, “Good for the Shah, Bad for the Mullahs”, 216. According to Iran, contracts worth a total of $12 billion were unfulfilled after the revolution. IAEA Report, November 15, 2007, 2.

128 For example, the United States cancelled plans to establish an MLIS laser research facility. IAEA Report, November 15, 2007.

129 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 11.

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such as nationalization of banks, insurance companies, and business concerns.130 Domestic discontent with the management of oil profits led to strikes even before the revolution; US and

European sanctions coupled with the invasion by Iraq “brought the industry to its knees”.131 The following graphs show the general trend in GDP during Restraint 1.132

Figure 7.1 Iran’s Economic Trends in Restraint 1

Source: World Bank, WDI Online, (World Development Indicators), http://databank.worldbank.org/ddp/home.do?Step=12&id=4&CNO=2.

Between 1979 and 1981 the United States banned all trade and froze some $12 billion worth of financial assets. The extensive economic relations between the two countries, including oil trade and loans, meant that Iran was particularly vulnerable to US sanctions.133 The asset

130 Adnan Mazarei Jr., “The Iranian economy under the Islamic Republic: institutional change and macroeconomic performance (1979-1990)”, Cambridge Journal of Economics, 20 no. 3 (1996), 290-291; Solingen, Nuclear Logics, 176; Economist Intelligence Unit, Country Profile Iran, 1996, 10.

131 Economist Intelligence Unit, Country Profile Iran, 1996, 22.

132 Nevertheless, as the second graph shows, Iran’s national income showed some elements of improvement during Restraint 1. This was principally due to the generation of non-oil income, notably from agriculture and industry. Patrick Clawson, “ Islamic Iran’s Economic Politics and Prospects”, Middle East Journal, 42 no. 3 (1988), 372.

133 Carswell, “Economic Sanctions”, 254-257.

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freeze was the largest such freeze in history, and was successful in blocking Iran’s access to the funds.134 The fact that Iran had billions of dollars in loans from US banks and its syndicates as well as foreign assets indicates that the financial impact of the sanction was significant. Indeed the regime appears to have been persuaded to release the hostages in return for a satisfactory removal of this sanction.135 The sanctions also made it near impossible to borrow on the international market to redress the mounting balance of payments crisis.136

American trade sanctions also had the potential to inflict substantial economic damage on

Iran. By the time of the revolution oil contributed some 75 percent of Iran’s GDP.137 In 1978 about 19% of Iran’s exports went to the United States, making it Iran’s largest trade partner.138

In 1978 about three-fourths of Iran’s exports went to the United States, Western Europe, and

Japan.139 Thus the oil sanctions by the United States and its allies had the potential to impact revenues.

Did sanctions cause such widespread economic damage in Iran? Oil revenues in post- revolutionary Iran declined significantly, and for the first few years largely reflected the fall in the quantity of oil exports.

134 Carswell, “Economic Sanctions”, 248, 251.

135 Carswell, “Economic Sanctions”, 254. The understanding on the release of the hostages was based on receipt of its remaining foreign assets after payment of its outstanding loans.

136 Mazarei, “The Iranian economy under the Islamic Republic”, 295.

137 Economist Intelligence Unit, Country Profile Iran, 1996, 13.

138 Hooman Estelami, “A Study of Iran’s Responses to US Economic Sanctions”, Middle East Review of International Affairs, 3 no. 3 (1999), 52; O’Sullivan, Shrewd Sanctions, 69.

139 O’Sullivan, Shrewd Sanctions, 69.

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Figure 7.2 Iran’s Oil Exports in Restraint 1

Source: Plotted based on data from OPEC Annual Statistical Bulletin (Organization of the Petroleoum Exporting Countries, Vienna), various years, http://www.opec.org.

The war with Iraq significantly slowed down oil production, partly due to Iraq’s early attacks on the oil rich province of Khuzestan.140 The new regime was taken by surprise when Iraqi forces crossed over into Khuzestan in September 1980.141 From late 1981 Iran started launching a series of offensives, and by May 1982 it had regained all its lost territory, particularly in

Khuzestan.142 There is little doubt that the war significantly affected oil production, both due to the direct damage on Khorramsher (the major city in Khuzestan) and because of resources diverted away from production.143

140 Khuzestan was considered as Iran’s “oil capital” and contained major economic projects such as ports, steel factories, oil refineries, and petrochemical factories. Hooshang Amirahmadi, “Economic reconstruction of Iran: costing the war damage”, Third World Quarterly, 12 no. 1 (1990), 27.

141 Pollack, Persian Puzzle, 186.

142 Pollack, Persian Puzzle, 191. However the war did not end; it dragged on into a stalemate as Iran sought to overthrow Saddam Hussein’s regime in Iraq.

143 Clawson, “Islamic Iran’s Economic Politics and Prospects”, 373-374.

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Sanctions also appear to have dampened oil production, although to a lesser extent.

Evidently, between March 1979 (when the Islamic Republic was formed) and September 1980

(when the war with Iraq began) the critical factors affecting the economy were the post- revolution flux and the US-led sanctions. Given that many of Iran’s major oil installations were constructed and maintained by American companies, it seems reasonable to conclude that the

US trade sanctions at least made it difficult for Iran to re-adjust to the lack of supplies as well as to find new trade partners. These difficulties, it appears, were further worsened with the onset of the war with Iraq.144 Thus the US sanctions contributed to Iran’s post-revolutionary economic plight, and their impact was magnified after the war began, when “the US sanctions against exports were having real impact”.145

Sanctions on Iran are estimated to have inflicted a total loss of about $3.4 billion.146 In the short term at least, then, the sanctions inflicted costs on the economy through the freeze of assets, and by forcing Iran to increase its oil exports to other trade partners. These difficulties were aggravated by the war with Iraq and the new nationalization policies of the Islamic regime.147 Nevertheless the economic consequences of the sanctions are considered as having been important enough to precipitate the eventual release of the American hostages.148

Iran’s economic concerns at this time likely limited the pool of funds available for the nuclear program. Since the program was already beginning to face some financial constraints before the revolution it is likely that post-revolutionary Iran would have found it difficult to

144 Carswell, “Economic Sanctions”, 254.

145 Carswell, “Economic Sanctions”, 254.

146 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM.

147 O’Sullivan, Shrewd Sanctions, 61.

148 Carswell, “Economic Sanctions”, 257; Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM.

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sustain high levels of spending on the nuclear program.149 This is strongly suggested by the fact that the Islamic Republic drastically cut spending in order to cope with its declining income – rapidly eliminating spending on development projects like roads and power plants.150 In fact the new regime called for the cancellation of the Bushehr project partly due to the high expenditure involved. Iran had already spent $3.1 billion on Bushehr, but the plant faced technical problems.

The new AEOI chief Fereidun Sahabi complained that the project was costing far more than envisioned in the original contract. Regime officials therefore concluded that it would be wiser to cut losses by closing the project.151 This decision to abandon the Bushehr project was made in the early days of the regime, months before the imposition of sanctions in November 1979, underlining the urgency of the financial constraints facing the regime. By early 1980 the Islamic

Republic clearly decided to halt the Shah’s nuclear program at least in part due to financial reasons, since it was estimated to cost a total of $80 billion.152

Conclusion: Resource Constraints in Restraint 1

From the above discussion it is seen that the technology denial experienced during

Restraint 1 was largely the consequence of Western wariness of the new Iranian regime rather than of sanctions. The US sanctions did, however, contribute to financial difficulties in post- revolutionary Iran, thus limiting the resources available for the nuclear program.

149 Central Intelligence Agency, Directorate of Intelligence, Middle East- South Asia: Nuclear Handbook (1988), accessed September 26, 2011, 25, http://www.foia.cia.gov/docs/DOC_0001033097/DOC_0001033097.pdf.

150 Iran’s spending cut post-1979 was reportedly the largest and fastest such cut by any country since World War II. Clawson, “Islamic Iran’s Economic Politics and Prospects”, 377-378.

151 William Branigin, “Iran Set to Scrap $34 Billion Worth of Civilian Projects”, Washington Post, May 30, 1979.

152 “Iran Scraps A-Plant Plan”, Washington Post, March 11, 1980.

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(b) Motivational Changes in Restraint 1

Besides limits on the supply of nuclear technology and financial capabilities, Restraint 1 was also the result of a decline in motivations to continue the nuclear program. These are based on the drastic change in the regime, as highlighted by the domestic politics model.153 This entailed two aspects.

First, at least some elements of the program stalled in the upheaval surrounding the revolution. In late 1978 Iran was in the grips of widespread domestic turmoil against the repressive policies of the Shah, who was overthrown in January 1979. The new regime involved major differences between the de facto leader Ayatollah Khomeini, and the official Prime

Minister Mehdi Bazargan.154 Major construction projects such as of the Bushehr power plants stalled at this time, partly due to the departure of hundreds of foreign engineers.155

Second, the new Islamic Republic established in April 1979 cancelled the Shah’s major projects including the nuclear program. Ayatollah Khomeini was reportedly opposed to nuclear technology as he abjured all that was intimately connected with the Shah as well as with the

West.156 The program was also apparently rejected on the grounds that it was immoral and un-

153 The security and prestige models have little applicability here since there were no obvious security or prestige benefits that Iran stood to reap by undertaking restraint – it neither experienced a decline in threats nor received a security guarantee; it made no official claims on the international immorality of nuclear technology or the moral correctness of abandoning the nuclear project.

154 While Khomeini wanted an Islamic Republic under velayet-e-faqih (the rule of the jurisprudent – which would pit him as the powerful player), Bazargan sought a democratic Islamic Republic that was ‘Islamic’ in name. Ultimately the constitution showed these tensions between popular rule and clerical rule. Ervand Abrahamian, A History of Modern Iran (Cambridge University Press, 2008), 162-163.

155 Branigin, “Iran Set to Scrap $34 Billion Worth of Civilian Projects”.

156 Kibaroglu, “Good for the Shah, Bad for the Mullahs”, 216. In 1982 Iran tried to resume work on the Bushehr reactors. However this was apparently driven by the financial complexity of suspending the deal rather than due to a renewed desire for the nuclear program. KWU, which had the contract for Bushehr, was planning to claim at least $550 million in losses. Albright and Stricker, “Iran’s Nuclear Program”; “W. German Company Cancels Nuclear Contract With Iran”, August 1, 1979.

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Islamic.157 Further, the recent nuclear accident at Three Mile Island in Pennsylvania reportedly generated some concerns about nuclear safety in a developing country.158 Thus regime officials such as the new AEOI chief Fereidun Sahabi called for cancelling the Bushehr project; the regime had already suspended the plan for nuclear power plants at Darkhovin by French suppliers.159

Thus Iran’s motivations for Restraint 1 lay in the chaos generated by major regime change as well as the beliefs and proclivities of the new leaders. The move to halt the nuclear program was already underway by the time Iraq launched its attack in September 1980. The war does not appear to have motivated restraint. Rather, as shown below, the military need for a deterrent best highlighted by the war led to an interest in the nuclear program from the mid-

1980s.

Table 7.2 Summary of Iran’s Restraint 1 (stop) 1979-1983

Prestige No

157 Quillen, “Iranian Nuclear Weapons Policy”,19; Ziemke, “The National Myth and Strategic Personality of Iran”, 111.

158 Branigin, “Iran Set to Scrap $34 Billion Worth of Civilian Projects.

159 Branigin, “Iran Set to Scrap $34 Billion Worth of Civilian Projects”.

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Pursuit 1984-2002

This section considers the possible effects of sanctions during this long period of nuclear pursuit until the early 2000s. The experience of the war with Iraq – especially the Iraqi use of chemical weapons – led to attempts to renew the program. Prominent leaders, particularly

Rafsanjani (who was Speaker of parliament in the 1980s and President in the 1990s) and Ali

Khamenei (who was President in the 1980s and Supreme Leader since 1989) supported nuclear pursuit.160 However Iran repeatedly met with technology denial by suppliers. By the early 2000s

Iran gradually built up its nuclear program with some assistance from Russia, China, and the

Khan network.

In this period the nuclear program progressed at widely differing levels – growing slowly in the 1980s and advancing rapidly in the late 1990s and early 2000s. This nearly twenty-year period is categorized here as one phase of nuclear pursuit since the nuclear program displayed at least some progress throughout this time. Even slow periods of growth qualify as nuclear pursuit here when compared with the halting of the program in the years prior (1979-1983).

Around 1982-84 Iran unsuccessfully approached Germany to resume construction at

Bushehr. Throughout the 1980s and 1990s Iran was repeatedly turned down by Western nuclear suppliers. Some assistance from China and the Khan network in the 1980s, together with a new nuclear cooperative relationship with Russia in the 1990s enabled Iran to successfully begin building up its nuclear infrastructure. By the late 1990s it was developing capabilities in uranium conversion, laser enrichment, and centrifuge enrichment. In the early 2000s Iran was

160 Solingen, Nuclear Logics, 177. The program also appears to have received a push after the death of Khomeini in 1989 following, which it actively moved toward seeking weapons capability. Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 12.

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conducting laser enrichment experiments, enriching “small amounts of uranium” to 0.8%.161 It also started constructing large-scale centrifuge enrichment plants, having successfully tested centrifuges with uranium hexafluoride in the late 1990s.

Thus this period of nuclear pursuit was characterized by slow steps toward renewing the program in the late 1980s, followed by more active efforts in the 1990s, culminating in rapid advances in the early 2000s. After listing the possible sanctions that could affect nuclear pursuit at this time, this section considers whether sanctions dampened the pace or extent of pursuit. It shows that sanctions on Iran were not the key reason for resource constraints that restricted the program. Moreover, the sanctions may have actually deepened Iranian motivations for the nuclear option, which could act as an important deterrent against a hostile world.

Sanctions possibly affecting Pursuit

During the nearly twenty years spanning this period, the United States kept increasing the scope of its sanctions on Iran. While the initial concerns were limited to Iran’s support for extremist Shi’a organizations conducting terrorist attacks, by the early 1990s the United States was increasingly concerned about Iran’s nuclear program. In the mid-1990s the United States took the unprecedented step of declaring sanctions on other countries that traded with Iran, under the controversial Iran-Libya Sanctions Act. During this period of nuclear pursuit, the sanctions affecting Iran were overwhelmingly unilateral US sanctions. Some limited sanctions on military and dual-use items were also imposed by the UK and Italy.162

161 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 76; IAEA Report, November 15, 2004.

162 Reynolds and Tan, “Empirical trends”, Table B3.7

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After the October 1983 attack on the US Marines in Beirut attributed to Hezbollah,163 the

United States placed Iran on its list of state sponsors of terrorism in early1984.164 From then on the United States gradually imposed more and more sanctions.165 In 1987 it banned all imports from Iran apparently to persuade it to end support for terrorism. The ban entailed some important exceptions -- Iranian crude oil refined abroad and trade in Iranian oil by American companies outside the United States were exempted from the sanctions.166 Another major exception involved the violation of sanctions in the Iran-Contra affair, when the United States sold arms to Iran under cover in exchange for the release of hostages taken by Shi’ite factions in

Lebanon in 1985. The scandal was exposed in late 1986.

In the 1990s the United States imposed sanctions for the specific purpose of limiting

Iran’s nuclear program, which eventually became the main justification for continuing the sanctions on Iran.167 Since it already banned the export of military and dual-use items, these sanctions were largely secondary sanctions i.e. sanctions on other countries supplying nuclear technology to Iran.168 The goal was to reduce foreign investment in Iran’s oil revenues and deny nuclear and dual-use items. In 1992 the United States adopted the Iran-Iraq Non-Proliferation

163 Embarking on an asymmetric strategy to counter its militarily superior adversaries, Iran created Hezbollah in Lebanon following that country’s invasion by Israel in 1982.

164 This involved the following measures: a ban on American arms sales, financial assistance, restrictions on the sale of dual-use items, and US opposition of multilateral lending to Iran. (The Iran-Contra affair violated the embargo by selling arms to Iran in exchange for the release of hostages in Lebanon.)

165 Patrick Clawson, “Iran” in Richard N. Haass, ed., Economic Sanctions and American Diplomacy (Council on Foreign Relations, 1998), 85.

166 O’Sullivan, Shrewd Sanctions, 49.

167 Reynolds and Tan, “Empirical trends”, 78.

168 One exception is Executive Order 13382 of June 2005, which called for blocking the assets of WMD proliferators and their supporters. Kenneth Katzman, “Iran Sanctions”, CRS Report for Congress, December 13, 2010, 35-36.

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Act, which tightened the trade sanctions on Iran to include all military and dual-use items as well as those on the commerce control list.169

American sanctions expanded dramatically in the 1990s under the Clinton administration, aimed at containment, regime change, reducing support for terrorism, limiting WMD and missile programs, promoting peace in the Middle East, and advocating human rights.170 The

United States was increasingly becoming concerned about Iranian efforts to pursue its nuclear program, and had successfully pressured its European allies to refrain from supplying nuclear technology. However by 1995 Iran achieved some success by turning to Russia to help build the

Bushehr nuclear power plant. This, together with increased lobbying by the American Israel

Political Affairs Committee (AIPAC), led to stringent US sanctions on Iran beginning in the mid-1990s.171 The most significant was a 1995 ban on American investment in the oil industry and a total ban on trade and investment, bringing to a virtual standstill all economic transactions with Iran.172 These were introduced under charges of terrorism and nuclear proliferation.173

169 O’Sullivan, Shrewd Sanctions, 52.

170 O’Sullivan, Shrewd Sanctions, 47, 57, 79.

171 O’Sullivan, Shrewd Sanctions, 53-54.

172 Until then, American companies were only barred from importing Iranian crude oil into US refineries. American oil companies were actually very active and heavily involved in buying and selling Iranian oil in foreign markets. Under pressure from the Republican Congress as well as from the Democratic Party, Clinton banned such transactions in 1995. The ban was precipitated by a high profile deal by Conoco to develop the Sirri oil fields. Economist Intelligence Unit, Country Profile Iran, 2004, 39.

173 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM. Some exceptions for humanitarian aid were introduced in 2000 to help US agricultural products, which had been facing low prices. Jo Becker, Ron Nixon, and William Yong, “With US Leave, Companies Skirt Iran Sanctions”, December 24, 2010. Other exceptions included the subsidiaries of US firms, which were free to continue economic transactions and certain imports (nuts, dried fruits, carpets, and caviar) allowed between 2000 and 2010. Katzman, “Iran Sanctions” (2010), 29-30.

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The United States introduced secondary sanctions with respect to Iran in 1996 i.e. sanctions on foreign entities that did business with Iran.174 They were enacted under the Iran

Libya Sanctions Act (ILSA), first passed in 1996 and later amended in 1997. It is now called the

Iran Sanctions Act or ISA (after Libya was dropped) and requires the president to place two sanctions -- from a possible list of six -- on companies investing more than $20 million in the

Iranian energy sector, or selling WMD-related technology or advanced conventional weapons.

The purpose of these sanctions was to curb resources available for the nuclear program and terrorist activities.175 ILSA was renewed in 2001 and is currently effective as ISA until

December 2016.176 The first imposition of ISA sanctions did not occur until September 2010 when a Swiss-based Iranian oil trading company was sanctioned.177 The following table sums up these US sanctions, highlighting the key measures.

Table 7.3 US Sanctions on Iran during Pursuit 1984-2002

Date Sanctions

Jan 1984 Iran is added to State Sponsors of Terrorism list (-- sanctions on arms exports, foreign aid, and international financial loans)

Feb1987- Iran is added to the list of countries producing and trafficking narcotics Dec1998

Oct 1987 US bans all imports from Iran, citing terrorism

1992 Iran-Iraq Arms Nonproliferation Act: US bans exports of dual-use items,

174 The context for these secondary sanctions was Iran’s opening of its oil sector for foreign investment in 1995. Katzman, “Iran Sanctions” (2010), 2.

175 Katzman, “Iran Sanctions” (2010), 2-3.

176 Katzman, “Iran Sanctions” (2010), 6.

177 Katzman, “Iran Sanctions” (2010), 7. The Clinton administration waived the ILSA sanctions in May 1998 in the first instance where a company was found to violate its provision, involving a deal to develop the South Pars gas field in Iran. This act of waiving the ILSA sanctions was repeated in April 1999, and by August 2010 no ILSA sanctions had been imposed.

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sanctions countries that provide substantial military assistance to Iran

March US bans investment in Iran’s oil industry 1995

May 1995 US bans all trade and investment in Iran; stops almost all economic activities

April 1996 US prohibits financial transactions with Iran, bans aid to countries providing military assistance to Iran – under a general terrorism law (Antiterrorism and Effective Death Penalty Act)

Aug 1996 The Iran-Libya Sanctions Act (ILSA) allows for US sanctions against foreign firms investing greater than $20 million in Iranian oil and gas

Aug 1997 US limits exports to countries that further export them to Iran

May 1998 US does not sanction French company Total for investing in Iran’s South Pars field

April 1999 US allows export of food and medicine to Iran

Nov 1999 US allows Boeing to sell spare parts for planes under warranty purchased by Iran before sanctions were imposed

March US govt. authorized to sanction countries/companies/individuals supporting 2000 Iran’s WMD programs under the Iran Nonproliferation Act178

April 2000 Partial ease of US trade sanctions, allowing imports of Iranian nuts, dried fruit, carpets, and caviar.

Summer ILSA is renewed 2001

September Executive Order 13224: Ban on US transactions with entities supporting 2001 terrorism

178 The act is renamed the Iran, North Korea, and Syria Nonproliferation Act in 2006. The United States is authorized to sanction entities and individuals associated with WMD and missile related technology transactions with Iran since 1999.

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(a) Resource Constraints and Pursuit 1984-2002

As the Islamic Republic sought to resurrect its nuclear program from the mid-1980s, it faced numerous instances of technology denial. Iran’s experience with nuclear cooperation with

Western countries was now vastly different from that under the Shah in the 1970s, when it had entered into numerous contracts for several reactors. Such a change in the willingness of nuclear suppliers had much to do with the anti-Western character of the Islamic revolution, best expressed in the hostage crisis in Tehran. Following these developments the United States not only severed its own nuclear cooperation, but also successfully persuaded its European allies to do the same. As argued below, this was an important cause of technology denial in this period.

Another factor that slowed down the nuclear program was the Iran-Iraq war, which not only cost

Iran large numbers of its men and money, but also involved direct attacks on the incomplete

Bushehr nuclear facility. This section assesses the role of sanctions in such resource constraints.

The analysis concludes that although sanctions contributed to resource constraints, the principal reason for Iran’s difficulties in its nuclear program stemmed from active American efforts to prevent nuclear supplies to Iran.

Technology Denial

During this period Iran found it difficult to access nuclear technology on the international market. Indeed according to Iranian officials, the country was forced to turn to the nuclear black market due to the absence of alternatives.179 Some of this technological denial is directly attributable to US sanctions prohibiting the export of sensitive technology and the indirect effect

179 Iran has stated that contracts with France, Germany, the UK and the United States totaling $10 billion were not fulfilled after the revolution. IAEA Report, November 15, 2007, 2.

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of sanctions in increasing international wariness of the Iranian regime.180 However technological denial is more powerfully explained by American pressure on nuclear suppliers.

The US sanctions starting in 1984, just when the Islamic Republic was seeking to renew its nuclear program, prohibited the export of arms and dual-use goods (as well as loans and foreign aid). This meant that the previous close nuclear cooperation between the two countries was officially canceled. From the 1980s onwards the United States has been active in persuading other countries to avoid supplying nuclear technology to Iran.181 Perhaps the best example of technological obstruction is the Bushehr nuclear power plant, which became operational only in September 2011, some thirty-six years after construction first began.182

Although Iran was negotiating with KWU since 1982, by 1986 it became clear that the deal would not go through when Germany denied export licenses. The stated reason was the ongoing war with Iraq, which qualified Iran as being a “region of tension”.183 In 1992, well after the war ended, Germany still declared Iran to be a “region of tension” and continued to deny export licenses to Siemens.184 Germany stated that another reason for denying the technology was its

180 ElBaradei, Age of Deception, 114, footnote 3.

181 Kibaroglu, “Good for the Shah, Bad for the Mullahs”.

182 “Iran’s First Nuclear Power Plant Goes Into Operation”, New York Times, September 4, 2011. Construction at Bushehr began in 1975 but was suspended after the revolution. In 1982 Iran approached KWU to rebuild the reactors damaged in the war but was apparently turned down due to security concerns about construction in the midst of the Iran-Iraq war. Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 11. Iran also unsuccessfully approached companies from Argentina, France, Germany, and Spain to help rebuild the Bushehr reactors. IAEA Report, November 15, 2007. Similar efforts with the Soviets in the late 1980s stalled with the collapse of the Soviet Union. In 1998 Russia agreed to supply a turnkey facility after working to alter the German design. Kibaroglu, “Good for the Shah, Bad for the Mullahs”.

183 Ann MacLachlan, “Iran seeking way to finish Bushehr plant but Bonn denies exports”, Nucleonics Week, 27 no. 44 (1986).

184 KWU was a subsidiary of Siemens.

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dual-use nature.185 Iran entered into negotiations with Russia in the mid-1990s, which agreed to complete the Bushehr plant. The United States actively sought to prevent or limit Russian cooperation as it was concerned that the project would generate a variety of links on nuclear cooperation, which Iran could then use for a covert weapons program.186 American reasoning was that having a nuclear power plant would give Iran an excuse for developing the fuel cycle.187 The Russians believed that the deal did not risk proliferation since IAEA safeguards were operating in Iran and because the spent fuel would be shipped to Russia.188

Iran reportedly approached Pakistan in the mid-1980s for nuclear technology. However it received little beyond some training of scientists, apparently due to Pakistani President Zia ul-

Haq’s desire to prevent American scrutiny of Pakistan’s nuclear program as well as due to ideological differences with Shiite Iran.189

Overtures to a number of other countries including Argentina, China, India, and the Soviet

Union to obtain research reactors in the 1980s and early 1990s were also futile.190 It is commonly agreed that the main reason for these failed efforts was America’s “determined campaign” to persuade other countries to deny nuclear technology on the grounds that Iran was

185 Mark Hibbs, “Bonn reiterates No to Bushehr; Iran ‘still region of tension’”, Nucleonics Week, 33 no. 32.

186 Kile, “Nuclear arms control” (2003), 596.

187 ElBaradei, Age of Deception, 115, footnote 4. Most particularly, America was concerned that Iran might extract plutonium from the spent fuel of the reactor. Shannon N. Kile, “Nuclear arms control and non-proliferation”, SIPRI Yearbook 2004 (Stockholm: SIPRI, 2004), 604.

188 Kile, “Nuclear arms control” (2003), 596-597.

189 Fitzpatrick, ed., Nuclear Black Markets, 67.

190 Corera, Shopping for Bombs, 62-63; IAEA Report, November 15, 2007. Iran did not seriously approach an important source of nuclear technology, France, due its resentment against French policies. The Islamic regime resented France’s heavy military and nuclear support to Iraq, and therefore stopped all direct economic and commercial links with France for some years after the revolution. Etemad, “Iran”, 216.

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seeking a weapons capability.191 For example efforts to acquire a heavy water research reactor from India, China, and Russia were thwarted by US pressure.192 American persuasion that Iran was seeking weapons capability led Argentina to block its shipment of a fuel fabrication facility and a uranium dioxide conversion plant, and to suspend negotiations for a pilot heavy water production facility.193

In the 1990s the United States successfully persuaded Russia and China to limit or cancel deals. After providing some equipment for a uranium conversion facility, in 1997 China cancelled the supply of further equipment in exchange for a deal with the United States for nuclear cooperation.194 The United States was less successful with Russia, whose Foreign

Ministry was concerned about Iran’s nuclear program, but the strong need for revenues as well as employment for scientists led the Ministry of Atomic Power (Minatom) and the Foreign

Trade Ministry to conclude deals with Iran.195 However, under American pressure Russia cancelled a deal to supply an entire enrichment plant and a 2000 deal for laser enrichment equipment.196 In 1994 American pressure blocked the sale of HEU fuel from a reactor in

Kazakhstan, which would have been enough for 20 nuclear warheads.197

191 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 11.

192 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 80; Neel Patri, “India says research reactor sale to Iran is in preliminary stages”, Nucleonics Week, 32 no. 48 (1991).

193 Mark Hibbs, “Iran sought sensitive nuclear supplies from Argentina, China”, Nucleonics Week, 33 no. 39 (1992); Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 13.

194 Corera, Shopping for Bombs, 62-63. China was also reportedly concerned about Iran’s nuclear program. China called off plans to deliver two 300 MW power reactors as well as a uranium conversion facility. Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 8, 13. IAEA Report, November 10, 2003; Richelson, Spying on the Bomb, 509.

195 Hibbs, “Iran sought sensitive nuclear supplies”.

196 Corera, Shopping for Bombs, 63; www.globalsecurity.org.

197 Hufbauer et al, Economic Sanctions Reconsidered, 3rd ed., CD-ROM.

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These instances of technology denial appear to be driven by direct American pressure on suppliers rather than by sanctions. It is possible that the secondary US sanctions on those supplying nuclear technology to Iran may have had some dissuasive effect on potential suppliers. However by the 1990s, when these sanctions were imposed, Iran realistically had few possible sources of nuclear technology – China, Russia, and the black market. As described here, Chinese and Russian nuclear cooperation was partially suspended in the 1990s. Again this was the result of direct American pressure rather than US sanctions.

American demands on other nations were bolstered by secondary sanctions introduced in the mid-1990s.198 However sanctions were not the primary reason for technological limitations, which was largely brought about by US political persuasion of suppliers.

Financial Constraints

As stated earlier, Iran faced numerous US sanctions during this period of nuclear pursuit

(1984-2002). The sanctions potential to inflict widespread financial constraints was limited as they were unilateral. This section shows that the direct financial costs of the US sanctions, in terms of revenues lost from prohibited trade and frozen assets, was not substantial. Iran readjusted by finding new trade partners. However, Iran faced mounting economic problems in this period from the stress of the Iran-Iraq war and structural inefficiencies of its economy. The

US sanctions aggravated these difficulties.199 This analysis concludes that the nuclear program would probably have progressed faster in the absence of these financial constraints.

198 O’Sullivan, Shrewd Sanctions, 82.

199 Brendan Taylor, Sanctions as Grand Strategy (London: International Institute of Strategic Studies, 2010), 92.

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Iran’s economy is dominated by the state, which receives oil revenues.200 The large developmental schemes under the Shah as well as the economic restructuring after the Iran-Iraq war preserved the centrality of the state in the economy.201

The economy has had volatile growth rates since the revolution, principally due to the war with Iraq and fluctuations in oil prices. During the war, Iran’s refineries were destroyed and exports interrupted.202 Real economic activity showed only a negligible increase ten years after the revolution.203 In the early 1990s GDP registered impressive growth rates up to 14%.204 This was mostly due to post-war reconstruction efforts.205

However persistent deficits and high inflation became major bottlenecks for further growth in the 1990s. The rebuilding effort had relied on heavy borrowing, leading to a massive increase in foreign debt manifested in two debt crises in 1993 and 1998-99.206 These were brought on by arms imports during the war, capital flight, and the freezing of Iranian assets.207

The regime dealt with these pressures by adopting a system of multiple exchange rates, keeping the prices of essential goods low. This helped reduce domestic discontent. However it led to a

200 Oil revenue is estimated to earn between 40 and 70 percent of the government’s income. Economist Intelligence Unit, Country Profile Iran, 2005, 28.

201 Economist Intelligence Unit, Country Profile Iran, 2005, 28.

202 Mazarei, “The Iranian economy under the Islamic Republic”, 293.

203 Mazarei, “The Iranian economy under the Islamic Republic”, 302.

204 World Bank, WDI Online, (World Development Indicators), http://databank.worldbank.org/ddp/home.do?Step=12&id=4&CNO=2.

205 Farshi Mojaver, “Sources of Economic Growth and Stagnation in Iran”, Journal of International Trade & Economic Development, 18 no. 2 (2009), 276.

206 O’Sullivan, Shrewd Sanctions, 62-63; Clawson, “Iran”, 86-87.

207 Mazarei, “The Iranian economy under the Islamic Republic”, 294-295.

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price system that was severely distorted and high budget deficits.208 Due to the high debt levels,

Iran had to conserve its foreign exchange reserves until the late 1990s.209 The following graphs display the declining trend in national income and growth fluctuations.

Figure 7.3 Iran’s GDP Growth Rates in Pursuit 1984-2003

208 Mazarei, “The Iranian economy under the Islamic Republic”, 290, 296-297.

209 Economist Intelligence Unit, Country Profile Iran, 2008, 20.

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Source: Plotted based on data from OPEC Annual Statistical Bulletin (Organization of the Petroleoum Exporting Countries, Vienna), various years, http://www.opec.org.

Some improvement in economic conditions occurred for the first time since the revolution only after 2000 with rising oil prices.210 In the early 2000s Iran succeeded in paying off most of its rescheduled foreign debt, and abolished the multi-tiered exchange rate system.211

To what extent can Iran’s economic troubles in the 1980s and 1990s be attributed to sanctions? Sanctions exacerbated existing problems and prevented the development of the oil and gas industry by barring American investment. In the 1980s, oil revenues decreased as result of less investment due to the sanctions.212 The 1995 ban on investing in the oil industry prevented US companies from reselling Iranian oil abroad, reportedly affecting some 20 to 25 percent of Iranian crude.213 Since the US sanctions of 1995, Iran has found it difficult to borrow on the international market.214 Sanctions also made it difficult to reach the full potential for profits by reducing the number of companies vying for contracts.215

US sanctions have periodically dissuaded foreign companies from business with Iran – several Iranian offers for oil development deals were not fulfilled in the context of the enacting

ISA in 1996.216 In addition, Iran has found it difficult to borrow on the international market

210 O’Sullivan, Shrewd Sanctions, 61.

211 Economist Intelligence Unit, Country Profile Iran, 2005, 29.

212 Mojaver, “Sources of Economic Growth”, 280.

213 Clawson, “Iran”, 93; O’Sullivan, Shrewd Sanctions, 66.

214 Clawson “Iran”, 93.

215 O’Sullivan, Shrewd Sanctions, 71.

216 Pollack, Persian Puzzle, 288. However the ripple effects of ISA lasted only a short time as the United States started granting waivers in 1998. O’Sullivan, Shrewd Sanctions, 72-73.

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since the US sanctions of 1995.217 This was of particular significance during its two debt crises in the 1990s.218 Thus the impact of US sanctions on Iran’s financial flows extended far beyond the specific sanctions imposed.219

Sanctions were, however, not the only cause of Iran’s economic malaise, where mismanagement and low oil prices have played significant roles.220 The economic effect of sanctions was also mitigated by the fact that most of the sanctions in the last thirty years were unilateral (which made it possible for Iran to find new trading partners), and because Iran adopted appropriate economic measures domestically such as promoting non-oil exports.221

Moreover US trade sanctions have tended to have only short term negative consequences for

Iran’s economy. The 1987 ban on exports affected Iran’s non-oil export income from items like carpets and pistachios. At the time about 7% of these Iranian exports went to the United

States.222 However, after initially suffering the costs of these changes, the economy adjusted by finding new trade partners.223 Iranian policy sought to avoid over-reliance on any one trade

217 Clawson, “Iran”, 93.

218 O’Sullivan, Shrewd Sanctions, 70.

219 O’Sullivan, Shrewd Sanctions, 67.

220 Suzanne Maloney, “Sanctioning Iran: If Only It Were So Simple”, Washington Quarterly, 33 no. 1 (2010); O’Sullivan, Shrewd Sanctions. Slow growth since the 1990s is attributable to low productivity, which is in turn explained by the economic policies and institutions under the Islamic Republic. For example the manufacturing sector is dominated by parastatal firms, which tend to be less efficient and competitive. Mojaver, “Sources of Economic Growth”, 292-293. Such deep-seated structural inefficiencies have hampered the economy since the end of the Iran-Iraq war. O’Sullivan, Shrewd Sanctions, 62; Clawson, “Iran”, 92.

221 Taylor, Sanctions as Grand Strategy, 94-95.

222 O’Sullivan, Shrewd Sanctions, 69.

223 Maloney, “Sanctioning Iran”.

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partner.224 The impact of US sanctions has also been mitigated by the numerous exceptions to them.225

In the final analysis, the US sanctions have exacerbated existing problems even though they were not the principal cause of Iran’s economic difficulties.226 Since oil income has been the biggest influence on government expenditures, decreasing revenues could have induced nuclear restraint in the 1980s.227

Financial considerations do appear to have impacted decisions on the nuclear program at this time. For example, both the decision first to cancel the Bushehr project (during Restraint 1) and later to renew it seem to have been driven by financial considerations. Early on it was thought wise to cancel the effort due to mounting costs and continuing technical difficulties.

Later, however, the AEOI sought to complete the project under rising energy needs as well as a consideration of the sunk costs, which were about $3 billion.228 Such matters were likely important in the 1980s due to the two factors of the war and declining oil prices, both of which limited the availability of financial resources. In the 1990s Iran faced two major debt crises, fueled by spending on post-war reconstruction. However there is no obvious evidence that such financial difficulties restricted the nuclear program in a significant way. In fact Iran’s repeated

224 Economist Intelligence Unit, Country Profile Iran, 1996-1997, 31-32. China and Japan are Iran’s largest trade partners today, shifting away from Europe. Economist Intelligence Unit, Country Profile Iran, 2008, 29-30.

225 Clawson, “US Sanctions” in Wright, ed., Iran Primer. The sanctions laws have tended to be complicated to allow for exceptions on factors affecting key domestic constituencies. Other exceptions include humanitarian assistance, under which the United States has donated a total of $475,000 for Iranian earthquake victims (in 1997 and 2002). Katzman, “Iran Sanctions” (2010), 34.

226 Katzman, “Iran Sanctions” (2010), 46-47.

227 Mohsen Mehrara, Majid Maki, and Hossein Tavakolian, “The relationship between oil revenues and economic growth, using threshold methods (the case of Iran)”, OPEC Energy Review, 34 no. 1 (2010), 3.

228 It was also apparently due to the growing need for energy. MacLachlan, “Iran seeking way to finish Bushehr plant”; Middle East- South Asia: Nuclear Handbook, Central Intelligence Agency, 27.

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efforts to develop fuel cycle capability suggests that it was not limited by overall economic problems. For example by the late 1990s Iran had paid the Khan network millions of dollars for centrifuge components.229

Conclusion: Resource Constraints and Pursuit 1984-2002

This segment has shown that sanctions were not the main factor behind the several instances of resource constraints on Iran’s nuclear program in this period. Rather, Western wariness about the new Islamic Republic --which found its maximum expression in American pressure on nuclear suppliers -- ensured that nuclear technology was repeatedly denied to Iran. It is also seen that, although the costly war with Iraq and fluctuating oil revenues increased the relative costs of the nuclear program, these do not appear to have significantly constrained spending on the program.

(b) Motivational Changes and Pursuit 1984-2002

Paralleling the limited sanctions effect via resource constraints, sanctions also do not seem to have dampened the motivations to acquire fuel cycle capability. In fact, the increasing strength of the US sanctions may have furthered leaders’ desire for such capability by signaling

Iran’s international isolation. Deteriorating relations with the United States in the 1990s appear to have deepened existing mutual suspicions, with the result that Iranian leaders increasingly came to perceive the nuclear program as important for national security and prestige.

The repeated attempts at obtaining nuclear technology suggest that the motivations for the program have been strong in this period. Although the Islamic Republic originally rejected the nuclear project as a symbol of Western dependence, this attitude quickly changed during the

229 Iran is estimated to have paid the network somewhere between $3 million and $5 - 10 million. Albright, Peddling Peril, 78; Corera, Shopping for Bombs, 69.

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Iran-Iraq war when the deterrent aspect of a nuclear weapons option became attractive. An important reason for this seems to have been Iraq’s use of chemical weapons, which became rampant since 1983.230

Interest in nuclear technology may also have been strengthened when the leadership realized that the West was determined to keep Iran from acquiring it – a conclusion it made when German and French contractors cancelled the Bushehr and Darkhovin nuclear power plants respectively.231 American support for Kuwaiti oil vessels in the tanker war of the 1980s, when oil shipping became a casualty of the Iran-Iraq war, further isolated Iran.232 Iran became interested in fuel cycle capability in the 1980s due to its limited military capabilities as well as its international isolation, both of which were highlighted in the war with Iraq. There is no obvious evidence that the US sanctions played into decisions on the nuclear program in the

1980s.

The United States gradually emerged as a serious security concern for Iran in the 1990s, especially with continuing American military presence in the Gulf following the 1991 Gulf War.

Since the 1990s, Iran has been sensitive to avoid provoking the United States into a major military attack.233 By 1995 the United States was openly referring to Iran as a “rogue state” and initiated covert efforts to overthrow the Islamic regime. American sanctions on Iran also

230 Vakil, “The Persian Dilemme”, 184; Ali, “Chemical Weapons and the Iran-Iraq War”, 47-48. Iraqi use of chemical weapons also gave rise to Iran’s own chemical weapons program. Cirincione et al, Deadly Arsenals (2005), 308.

231 Kibaroglu, “Good for the Shah, Bad for the Mullahs”, 217.

232 Iran began targeting oil ships belonging to the Gulf States. In response to Kuwaiti entreaties, the United States agreed to reflag Kuwaiti tankers under the American flag for US naval protection. This led to several confrontations between Iran and the United States in the Persian Gulf, and by 1988 “most of the Islamic Republic’s small navy was destroyed.” Vaziri, “Iran’s Nuclear Quest”, 316.

233 Pollack, Persian Puzzle, 255-256.

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steadily increased in the 1990s, including new sanctions specifically aimed at limiting its nuclear program. Indeed proliferation concerns became the major rationale for continuing sanctions on Iran.234 Thus the gradual escalation of both sanctions and military threats from the

United States in the 1990s deepened motivations for the nuclear program.235 In the context of such developments, the increase in unilateral American sanctions may have conveyed the urgency of security threats to the Iranians.236

Restraint 2 (Slow) 2003-05

With the public revelation of the secret nuclear facilities in 2002, the United States increased accusations that Iran had a covert nuclear weapons effort. Iran agreed to IAEA inspections in this context of mounting pressure.237 Negotiations with the E3 beginning in the fall of 2003 produced two significant agreements, as a result of which Iran suspended key enrichment-related and conversion activities. Thus in 2003-05 the nuclear program proceeded more slowly than it was capable of. Iran also took the noteworthy step of signing the Additional

Protocol in December 2003.238 This phase of restraint lasted until August 2005, when Iran

234 Reynolds and Tan, “Empirical trends”, 78.

235 Parsi, Treacherous Alliance, 143; Khan, Iran and Nuclear Weapons, 81; Timmerman, Countdown to Crisis, 100; Dorraj, “Behind Iran’s Nuclear Pursuit?”.

236 One example of the perceived link between sanctions and security is the 1994 Iranian threat to withdraw from the NPT (during the discussions for renewing the treaty), on the grounds that Western sanctions violated its right to peaceful nuclear energy. Rodney W. Jones and Mark G. McDonough, Tracking Nuclear Proliferation: A Guide in Maps and Charts, 1998 (Washington, DC: Carnegie Endowment for International Peace, 1998).

237 Although Iran agreed to inspections to be held in October 2002, they were postponed several times, an indication of Iranian reluctance to carry through with the inspections. IAEA Report, June 6, 2003, 2. IAEA Director General ElBaradei notes that the inspections were postponed due to a “long list of excuses” from Iran such as inconvenient dates, and President Khatami being sick or travelling. ElBaradei, Age of Deception, 113. The publication of commercial satellite images of the sites in December 2002 seemed to facilitate Iranian cooperation, and ElBaradei visited the sites in February 2003.

238 It never ratified the protocol, and stopped implementing its provisions in early 2006 as a response to referral to the Security Council.

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started conversion activities in protest against infringement on its rights within the NPT. This section argues that Restraint 2 was driven by motivational factors, and that the threat of UN sanctions played an important role in persuading Iranian leaders to undertake restraint.

Under the Tehran Agreed Framework of October 2003, Iran agreed to suspend enrichment and reprocessing activities. Consequently, it stopped operating and installing centrifuges from November 2003. This constituted a significant step of nuclear restraint since

Iran stopped a key process in the production of fissile material.239 It is also significant since Iran had only recently attained the capability to enrich uranium with centrifuges.240 Indeed, the IAEA reportedly believed that some 30% of the installed centrifuges crashed or broke down later due to the suspension.241

In the spring of 2003 the E3 began expressing concerns about Iran’s experiments in uranium conversion, which started in March 2004. In August 2004 Iran produced its first uranium hexafluoride – the feed material for centrifuge enrichment. As a result of further negotiations, Iran and the E3 signed the Paris Agreement in November 2004, under which Iran agreed to a stricter definition of suspension to include the manufacture, assembly, installation, and testing/ operation of centrifuges and centrifuge components as well as tests or production at

239 Although most analyses view the Paris Agreement of 2004 (discussed below) as the critical start of nuclear restraint, I maintain that restraint actually began with the Tehran Declaration of 2003 with the halt on centrifuge operation. Shannon N. Kile, “Nuclear Arms Control and Non-Proliferation”, SIPRI Yearbook 2005: World Armaments and Disarmament (Stockholm: SIPRI, 2006), 484.

240 Iran had just made some important progress in enrichment – it introduced nuclear material (uranium hexafluoride) into the pilot plant at Natanz for the first time in June 2003, and began testing centrifuges using the material in August 2003. The plant started fully operating i.e. conducting enrichment in October 2003. IAEA Report, August 26, 2003; IAEA Report, May 31, 2010.

241 David Albright and Corey Hinderstein. “The Clock is Ticking, But How Fast?”, ISIS Report, March 27, 2006 (Washington, D.C.: Institute for Science and International Security, 2006), 3, accessed May 31, 2012, http://isis- online.org/uploads/isis-reports/documents/clockticking.pdf.

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any uranium conversion facility.242 In a few months the E3 began demanding that Iran permanently stop these activities, as it began supporting the US position that Iran should be referred to the Security Council.243 In August 2005 Iran resumed uranium conversion and centrifuge installation, and by early 2006 it restarted testing centrifuges using uranium hexafluoride, thus terminating Restraint 2.244

Restraint 2: Motivational or Resource Driven?

This phase of restraint was clearly driven by motivational factors since Iran chose to suspend nuclear-related activities that were already underway. Although it seems that some of these newly begun activities may have faced some technical hurdles,245 the slow growth in the nuclear program classified as Restraint 2 was due to Iran’s conscious suspending of these processes. This is especially made evident by President Khatami’s declaration in February 2003 that Iran intended to develop the complete nuclear fuel cycle, from mining and processing uranium to reprocessing spent fuel.246 Also, in September 2002 AEOI chief Reza Aghazadeh

242 “Paris Agreement”. It also held that Iran would continue such voluntary suspension so long as negotiations for a mutually acceptable long-term solution continued. Such a final resolution was to include: “objective guarantees that Iran’s nuclear program is exclusively for peaceful purposes”, “firm commitments on security issues”, and “firm guarantees on nuclear, technological and economic cooperation” (Paris Agreement 2004). What would prove to be a major stumbling block was the interpretation of “objective guarantees” to establish the peaceful nature of the nuclear program. In early 2005 there emerged differences on what constituted “objective guarantees” that the program was peaceful.

243 The specifics of these developments are discussed below.

244 By the end of 2006 it also restarted the manufacture, assembly, and operation of centrifuges at the pilot plant at Natanz.

245 For example it is reported that the uranium hexafluoride initially produced was unsuitable for centrifuge enrichment due to contamination by metal particles. Kile. “Nuclear arms control” (2006), 624.

246 Kile, “Nuclear arms control” (2004), 605.

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had announced to the IAEA General Conference that Iran planned to generate 6000 MW of nuclear energy in twenty years.247

The suspension was the consequence of intense negotiations with the E3, which were themselves brought on by the threat of IAEA referral to the Security Council, as the United

States demanded.248 If referred, it was commonly understood that the Council would impose or at least threaten sanctions on Iran. It is argued below that Iranian leaders were motivated to undertake restraint by the threat of UN sanctions.

Sanctions possibly affecting Restraint 2

During this time Iran was under a complete ban on American trade and investment, which had come to play since the mid-1990s. It remained on the list of State Sponsors of

Terrorism (since 1984), and in the mid-1990s the United States enacted secondary sanctions on third parties trading with Iran.249 These sanctions were placed on charges of terrorism and nuclear proliferation.

Besides these imposed US sanctions, Iran faced the mounting threat of UN sanctions during Restraint 2. The details surrounding two major Iran-E3 agreements in 2003 and 2004 show the importance of the threat of UN sanctions, an eventuality that was expected to come into play once the IAEA referred Iran to the Security Council. In this context, two critical resolutions by the IAEA Board played a central role in conveying the threat of referral to the

247 Reza Aghazadeh, Reza, “Statement at the 46th General Conference. International Atomic Energy Agency”, 16 September, 2002, accessed June 8, 2012, http://www.iaea.org/About/Policy/GC/GC46/iran.pdf.

248 From around May 2003 the United States was actively pushing for the IAEA to declare Iran to be in non- compliance of its NPT commitments. Steven R. Weisman, “New US Concerns of Iran’s Pursuit of Nuclear Arms”, New York Times, May 8, 2003. According to the Agency’s Statute, a state would be referred to the Security Council if it failed to remedy such non-compliance issues “within a reasonable time” (IAEA Statute, Article XII C).

249 However, such secondary sanctions under the Iran and Libya Sanctions Act were not actually imposed until 2010 since the President granted waivers on several occasions.

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Council. To understand this threat of UN sanctions, it is necessary to examine the key developments at this time.

In late 2002 US accusations of a secret Iranian nuclear weapons program strengthened after the public revelation of two secret sites. Iran maintained that its nuclear program was entirely peaceful,250 and attributed the clandestine nuclear activities to the systematic Western effort to deny it nuclear technology.251 In February 2003 IAEA Director General Mohammad

ElBaradei toured the Natanz and Arak facilities. In ensuing discussions with the Agency, Iran made some effort to remedy its failure to report these facilities as well as the import of uranium in the 1990s. It also allowed the Agency to take environmental samples at Natanz and other nuclear facilities.252

In June 2003 IAEA Director General Mohammad ElBaradei released his first report after inspections at the newly revealed sites, stating that Iran had failed to declare these facilities and activities. The IAEA Board repeatedly urged Iran to accept more intrusive inspections under the

Additional Protocol in order to establish the peaceful nature of the nuclear program.253 Iran responded that it was willing to consider the additional inspections, but voiced concerns about access to peaceful applications of nuclear technology.254 In his August 2003 report, ElBaradei

250 The stated reason was the need for nuclear energy, since fossil fuels were expected to run out in 20-50. Kamal Kharrazi, “The View from Tehran”, Middle East Policy, 12 No. 1 (2005), 29.

251 Alsi U. Bali, “At the Nuclear Precipice: Iran” in Richard Falk and David Krieger, eds., At the Nuclear Precipice: Catastrophe or Transformation? (Palgrave Macmillan, 2008), 101-102.

252 Kile, “Nuclear arms control” (2004), 606.

253 Richard Bernstein, “UN Atom Agency Seeks Wider Scrutiny on Iran, But is Rebuffed”, New York Times, June 20, 2003. Others also urged Iran to sign the Additional Protocol, most notably Britain, France, Germany, and Russia. Felicity Barringer, “Iran Is Urged to Sign Pact Giving Power To Inspections”, New York Times, June 17, 2003.

254 Barringer, “Iran Is Urged to Sign Pact”. The issue of acceding to the Additional Protocol was highly controversial in Iran, with some arguing that it mounted to treason. Hassan Rowhani, “Text of Speech to the Supreme Cultural Revolution Council. Beyond the Challenges Facing Iran and the IAEA Concerning the Nuclear 416

stated that Iran had not been fully forthcoming in its cooperation with the IAEA, and that some of the information provided was contradictory or incomplete.255 The United States pressed the

IAEA to declare Iran to be in non-compliance with the NPT, and urged sanctions by the

Security Council. The E3 – UK, France, and Germany – launched a diplomatic effort in August

2003 to try to resolve the issue. They were concerned about obtaining clarifications from Iran regarding its nuclear program, but appeared keen to avoid the more confrontational American approach.256 Iran responded by indicating a willingness to negotiate on the Additional

Protocol.257 Around the same time the IAEA found traces of weapons-grade HEU at Natanz, generating strong suspicions of the purpose of the centrifuge enrichment program.

The IAEA Board of Governors passed a resolution in September 2003 demanding that

Iran disclose the full extent of its nuclear program by the end of October and to “promptly and unconditionally” sign and implement the Additional Protocol.258 The Agency called on Iran to suspend all enrichment-related activities, and reiterated a previous request (in June 2003) not to introduce nuclear material at its pilot enrichment plant at Natanz.259 It also called on Iran to suspend any reprocessing activities as a confidence building measure.260 The Board was motivated to undertake such an unusual declaration due to unresolved issues about Iran’s

Dossier”, Rahbord (Persian), September 30, 2005, accessed May 22, 2012, http://www.david- morrison.org.uk/other-documents/rohani-sncc-2004autumn.pdf.

255 Kile “Nuclear arms control” (2004), 606.

256 Kile “Nuclear arms control” (2004), 607.

257 Seyyed Hossein Mousavian, Iran-Europe Relations: Challenges and Opportunities (Durham Modern Middle East and Islamic World Series: Routledge, 2008), 149-150.

258 IAEA Report, September 12, 2003, paragraph 6.

259 Iran had begun centrifuge tests using uranium hexafluoride – “nuclear material” – in June 2003. Paul Kerr, “Concern Heats Up Over Iran’s Nuclear Program”, Arms Control Today, 33 no. 8 (2003).

260 IAEA Report, September 12, 2003, paragraph 3.

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nuclear program – it had “grave concern” that Iran had not delivered a full declaration of its program; that HEU had been detected in the environmental samples from Natanz; that the

Kalaye Electric Company had been substantially modified before inspectors arrived;261 and that, contrary to its declaration, Iran had introduced nuclear material at the pilot enrichment facility at

Natanz. The Board resolution entailed an implicit threat of referral to the Security Council, which was expected to impose sanctions.262

Keeping to the deadline of October 31 set by the IAEA, Iran agreed to undertake some noteworthy measures under the Tehran Agreed Statement with the E3 of October 21, 2003. Iran declared it would “voluntarily suspend all uranium enrichment and reprocessing activities as defined by the IAEA”.263 Such a voluntary suspension is especially significant since enrichment had just begun at the pilot plant at Natanz the same month. Iran also agreed to implement and sign the Additional Protocol immediately. In return it could expect that the E3 would block referral to the Security Council so long as Iran abided by these new commitments.264

261 The Kalaye Electric Company was an AEOI-owned company on the suburbs of Tehran, where P-1 centrifuges were tested in the late 1990s. Inspectors noted a “considerable modification” of the site compared to their previous visit in March. IAEA Report, August 26, 2003, 7.

262 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 19; Shannon N. Kile, “The controversy over Iran’s nuclear programme” in Shannon N. Kile, ed., Europe and Iran: Perspectives on Non-Proliferation (Solna, Sweden: Oxford University Press), SIPRI Research Report No. 21; “UN Sets Deadline for Iran on Nuclear Arms”, New York Times, September 13, 2003; Fitzpatrik, ed., Iran’s Nuclear, Chemical, and Biological Capabilities: A Net Assessment, 19. Such referral is “the only act of enforcement specified by the charter of the IAEA” (Miller 2007, 555). Steven E. Miller, “Proliferation Gamesmanship: Iran and the Politics of Nuclear Confrontation”, Syracuse Law Review, 57 no. 3 (2007).

263 “Tehran Agreed Statement”, paragraph 2; According to the IAEA, Iran committed to “suspend all activities on the site of Natanz, not to produce feed material for enrichment processes and not to import enrichment related items”. IAEA Report, November 10, 2003, paragraph 19. However according to Iranian officials, Director General ElBaradei had agreed to the narrower definition of enrichment-related activity to involve the introduction of uranium hexafluoride in centrifuges. Acknowledging that this was significantly less than the stated Board intention for Iran to stop all enrichment-related activities, Iranian official Hossein Mousavian – who was involved in the negotiations – emphasizes that this was the clear understanding with ElBaradei. Mousavian, Iran-Europe Relations, 157-160.

264 “Tehran Agreed Statement”, paragraph 3c.

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Iran immediately implemented its new commitments by granting the IAEA access to the facilities, and signing the Additional Protocol in December 2003.265 It also made some first-time admissions to the Agency such as the previous existence of a laser enrichment program and past work in reprocessing experiments.266 Nevertheless, the E3 were concerned about the continuing production and assembly of centrifuges. In February 2004 Iran agreed to freeze these activities in exchange for movement toward closing the Iran nuclear dossier at the IAEA. It stopped the production and assembly of centrifuges between April and June 2004.

Despite such cooperation from Iran, two issues became important in early 2004. In

January Iran admitted having received drawings for the P-2 centrifuge in 1994, a fact that was not mentioned in its October 2003 declaration.267 Second, the IAEA had concerns about the

Lavizan-Shian Technical Research Center as possibly being involved with nuclear weapons research. The site was razed in fall 2003. Matters came to a head when Iran “abruptly” postponed IAEA inspections there, scheduled for March 2004.268 The IAEA Board passed a resolution criticizing Iran for not fully declaring the extent of its nuclear activities – especially regarding P-2 centrifuge designs, polonium production, HEU contamination at Kalaye and

Natanz, and the full extent of the laser program.269 Iran immediately blocked IAEA inspections

265 Mohammed ElBaradei, “Introductory Statement to the Board of Governors”, November 25, 2004, accessed May 20, 2011, http://www.iaea.org/newscenter/statements/2004/ebsp2004n016.html.

266 However some issues were not fully clarified. For example, with the gradual unraveling of the Khan network, the IAEA learned that Iran had received some drawings for P-2 centrifuges; the IAEA also learned of possible polonium production; it was unclear about the source of HEU contamination at Natanz; and Iran continued to deny using uranium hexafluoride in centrifuge tests. Mousavian, Iran-Europe Relations, 165-166.

267 The P-2 centrifuge was reportedly 2.5 times more efficient than the P-1 in centrifuge enrichment.

268 ElBaradei, Age of Deception, 127-128.

269 IAEA Report, March 13, 2004, 2.

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in protest against the resolution.270 Iranian Ambassador to the IAEA Pirooz Hosseini stated that

Iran was not obliged to reveal everything.271

By June 2004 the understanding between the E3 and Iran seriously crumbled, apparently due to US pressure on the E3 and facilitated by Libya’s recent decision on nuclear rollback.272

An IAEA Board Resolution in June 2004 further criticized Iran. Dissatisfied that the nuclear dossier was not closed, Iran informed the Agency that it was resuming the manufacture and assembly of centrifuges; and in August 2004 it began producing uranium hexafluoride, the feed material for enrichment.273 This prompted the IAEA Board to adopt a resolution in September

2004, demanding “Iran immediately suspend all enrichment-related activities, including the manufacture or import of centrifuge components, the assembly and testing of centrifuges, and the production of feed material”.274 Again, the resolution contained an implicit threat of referral to the Security Council if Iran did not comply by the time of the next board meeting on

November 25, 2004.275 And once again Iran and the E3 reached an understanding before the deadline set by the IAEA.

On 15 November 2004 the E3 and Iran signed the Paris Agreement based on a stricter definition of suspension to include the manufacture, assembly, installation, and testing/

270 Joby Warrick, “Iranians Bar Further Nuclear Inspections”, Washington Post, March 14, 2004.

271 Louis Charbonneau and Mark Trevelyan, “Head of Nuclear Watchdog Expresses Concern Over Iran”, Washington Post, March 9, 2004.

272 Mousavian, Iran-Europe Relations, 170. Iranian concessions appeared small when compared with the Libyan decision on nuclear rollback.

273 Shannon N. Kile, “Nuclear Arms Control and Non-Proliferation”, SIPRI Yearbook 2005: World Armaments and Disarmament (Stockholm: SIPRI, 2005), 561. Iran had started experiments in uranium conversion in March 2004. IAEA Report, November 15, 2004.

274 IAEA Report, September 18, 2004, paragraph 3, emphasis original.

275 Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 23.

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operation of centrifuges and centrifuge components as well as tests or production at any uranium conversion facility.276 The IAEA soon verified that Iran had stopped manufacturing centrifuge components and producing uranium hexafluoride.277 However, the United States was dissatisfied that the enrichment suspension was ‘voluntary’ and that the Agreement did not halt construction at the Arak heavy water facility. Seeking further assurance that Iran’s nuclear program was for peaceful purposes alone, early in 2005 the E3 demanded that Iran permanently stop enrichment activities, while Iran held that its enrichment suspension was purely voluntary.278 In March 2005 the United States began supporting the E3 efforts279 and announced that it would not object to Iranian membership in the WTO if Iran permanently renounced enrichment. With this change in the American position, the E3 agreed to support ongoing US demands that Iran be referred to the Security Council.280

While these problems emerged, Iran began proposing possible solutions in the first months of 2005. The Iranian proposals of 2005 included some significant measures such as abandoning reprocessing plans and limiting enrichment to the LEU level; converting all enriched uranium into fuel rods281 and eventually placing a “permanent ban on the

276 “Paris Agreement”.

277 ElBaradei, “Introductory Statement”.

278 Iranian officials had thought that the Paris Agreement signified that the Europeans had abandoned the demand of permanent enrichment suspension. Fitzpatrick, Iranian Nuclear Crisis, 24.

279 Until now the United States had viewed the E3 negotiations with suspicion – the US position was that Iran must abandon all enrichment and reprocessing activity permanently. In fact it even demanded dismantling related facilities, and the entire nuclear energy program. Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 26.

280 Kile, “The controversy over Iran’s nuclear programme” in Europe and Iran: Perspectives on Non-Proliferation ed. Kile.

281 This would ensure that Iran could not further enrich the uranium. Shannon N. Kile, “Nuclear Arms Control and Non-Proliferation” in SIPRI Yearbook 2005: World Armaments and Disarmament ed. Shannon N. Kile (Stockholm: SIPRI, 2006), 621.

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Development, Stockpiling, and Use of Nuclear Weapons”;282 agreeing to the continuous on-site presence of IAEA inspectors; ratify the Additional Protocol; and suspending enrichment for another six months.283 In return, the E3 were to give reassurances that they would not use force against Iran, would respect its territorial boundaries, and would not use nuclear weapons against

Iran.284 The E3 insisted that the only objective guarantee would be the permanent cessation of all enrichment activity, apparently rejecting these offers under US pressure.285 E3 officials talked with American officials about possibly referring Iran to the Security Council if it renewed enrichment activity.286 Moreover it appears that the E3 were stalling for time till after the

Iranian presidential elections of June 2005, when it was hoped that the politically stronger

Rafsanjani would be voted to power.287

The E3 offered a counter proposal in August 2005, a few days after the new Iranian president Mahmoud Ahmedinejad took office. In return for enrichment suspension,288 Iran

282 “Elements of Objective Guarantees”, Presented by Iran at the Meeting of the Steering Committee, Paris, March 23, 2005, accessed March 23, 2001, http://www.armscontrol.org/pdf/20050323_Iran_Proposal_Steering_Cmte.pdf.

283 “Iran Proposal”, Proposal by Iran presented to the Meeting of the Steering Committee, London, April 29, 2005, accessed March 23, 2011, http://www.armscontrol.org/pdf/20050429_Iran_Proposal_Steering_Cmte.pdf.

284 “Iran Proposal”, Proposal by Iran, presented to Political and Security Working Group, Geneva, January 17, 2005, accessed March 23, 2011, http://www.armscontrol.org/pdf/20050117_Iran_Proposal_PSWG.pdf .

285 Bali, “At the Nuclear Precipice”, 102-104; Kile “Nuclear arms control” (2006), 621.

286 Dafna Linzer, “Europeans Agree to Meeting With Iran on Nuclear Program”, Washington Post, May 17, 2005.

287 The government of the liberal President Khatam ran into multiple problems of factional politics largely due to differences of opinion with supreme leader Khamenei. Alethia H. Cook and Jalil Roshandel, The United States and Iran: Policy Challenges and Opportunities (New York: Palgrave Macmillan, 2009), 43; Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 27.

288 This time there was a new demand to stop constructing the heavy water reactor at Arak. Framework for a Long Term Agreement between the Islamic Republic of Iran and France, Germany, and the United Kingdom, with the support of the High Representative of the European Union, INFCIRC/651, Communication dated 8 August 2005 received from France, Germany and the United Kingdom to the Agency, August 8, 2005, accessed April 20, 2011, http://www.armscontrol.org/pdf/20050805_Iran_EU3_Proposal.pdf, paragraph 37. Iran was also to offer a legal commitment not to withdraw from the NPT, continue to implement the Additional Protocol and ratify it, and return spent fuel to supplier countries (Framework, paragraph 36). The E3 held that the suspension would be renewed 422

would receive (among others) a reaffirmation by the UK and France that nuclear weapons would not be used against Iran unless attacked,289 and LEU fuel supply for any light water reactors built by the E3. Although it entailed some positive aspects, the proposal was disappointing to Iran since it continued to demand a stop to fuel cycle activities.290

By this point the negotiations were tainted by two major factors: Iranian view that the EU was caving in to American pressure demanding a permanent stop to enrichment; and Western perception that the election of conservative president Ahmadinejad made it harder to resolve the issue.291 Iran rejected the EU proposal, stressing that it did not recognize its right to enrichment.292 Moreover Iran had been pushing for a European response before the elections as it was under domestic political pressure to show some positive developments from the negotiations.293 A few days later it resumed uranium conversion, thus terminating the suspension and putting an end to negotiations.294

every ten years, thus for the first time explicitly jettisoning the demand to permanently halt enrichment. Fitzpatrick, Iranian Nuclear Crisis, 25.

289 The UK and France reiterated previous commitments made in 1995 under Security Council Resolution 984 that they would not attack non-nuclear weapons state members of the NPT unless attacked with assistance from a nuclear weapons state; and that they would press the Security Council to assist a non-nuclear weapons state member of NPT that is attacked involving nuclear weapons. Framework for a Long Term Agreement, paragraph 4; UN Security Council Resolution 984, April 11, 1995.

290 ElBaradei, Age of Deception, 144.

291 Ahmadinejad and Ali Larijani (the new secretary of the Supreme National Council) had heavily criticized the negotiations in their election campaigns. Kile, “Nuclear arms control” (2006), 623.

292 Iranian leaders were hoping to resume at least uranium conversion, which would be a face-saving measure with the domestic public. By disallowing this, the West was seen as unwilling to budge even on this issue. ElBaradei, Age of Deception, 144.

293 Dafna Linzer, “Europeans Agree to Meeting With Iran on Nuclear Program”, Washington Post, May 17, 2005.

294 Iran viewed the tardy European response as undermining the Paris Agreement; the E3 held that resuming conversion violated the Paris Agreement. Thus both sides believed that the other significantly deviated from the understanding. Bali, “The Nuclear Precipice”, 104.

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On both occasions when Iran agreed to suspend enrichment-related and reprocessing activities – in October 2003 and November 2004 – it was evidently seeking to avoid official

IAEA referral to the Security Council. An immediate concern was to prevent the Council from discussing sanctions on Iran. Thus the two key agreements in Restraint 2 were driven by the

Iranian desire to avoid UN sanctions.

The analysis of the role of sanctions in Restraint 2 begins with a consideration of the possible resource constraints that may have affected the nuclear program, although it was shown above that motivational factors were more influential at this time. Following this, I examine the factors contributing to Iran’s desire to avoid referral, including the role of political and military factors that deepened the perceived danger from UN sanctions.

(a) Resource Constraints in Restraint 2

During Restraint 2 Iran was facing various sanctions by the United States, as well as the threat of UN sanctions. This sub-section examines the possible resource constraints inflicted by the US sanctions. Since the UN sanctions were merely threatened and not imposed at this time, they did not deny resources for the nuclear program. Nevertheless, this analysis considers the resource-denial potential of the UN sanctions. Indeed the primary focus is on the potential of the

UN sanctions rather than the actual impact of the US sanctions, since US sanctions did not change significantly between 2001-02 – a phase of nuclear pursuit, and 2003, when restraint began.

Technology Denial

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At this time Iran did not face any obvious technology denial for the nuclear program, barring the important exception of the unraveling of the Khan network. The network, which had been an important supplier of centrifuge technology, was discovered with intelligence findings and new revelations following Libya’s dramatic nuclear rollback in 2003-04. These developments were unrelated to the US sanctions, which had limited potential for technology denial since the United States was in any case not supplying nuclear technology to Iran.

The threatened UN sanctions had some potential to deny technology for the nuclear program. However, Iran had already crossed important milestones at the start of Restraint 2, most especially in starting the process of enriching uranium with centrifuges. Having received key components from the network, the AEOI was domestically producing other components for centrifuges.295 This meant that the potential for sanctions to deny necessary technology was limited. Iran was mastering centrifuge technology at a time when it already faced strong US sanctions and an active and fairly effective US policy of blocking other suppliers. Hence it can be concluded that the advanced nature of Iran’s nuclear program seriously limited the prospects of denying technology.

Financial Constraints

By this time Iran had largely adjusted to not having the United States as a trade and investment partner. However UN sanctions had the potential to inflict serious economic damage on Iran, which depended on its oil revenues.

From the early 2000s, the economy showed significant improvements in growth rates and other economic indicators. Growth was buoyed by rising oil prices as well as expanding

295 The AEOI’s Kalaye Electric produced centrifuge components at various industrial complexes such as Pars Trash and Farayand Technique. www.nti.org.

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production; Iran paid off much of its rescheduled foreign debt; inflation rates improved under new policies by the Central Bank (Bank Markazi) such as abolishing the multiple exchange-rate system and establishing a single exchange rate.296 The following graphs show these improving trends at the time of Restraint 2.

Figure 7.4 Iran’s Oil Exports in Restraint 2

Source: Plotted based on data from OPEC Annual Statistical Bulletin (Organization of the Petroleoum Exporting Countries, Vienna), various years, http://www.opec.org.

296 Economist Intelligence Unit, Country Profile Iran, 2005, 29; Economist Intelligence Unit, Country Report Iran, March 2004, 11; O’Sullivan, Shrewd Sanctions, 61.

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Figure 7.5 Iran’s GDP prior to Restraint 2

Source: Plotted based on data from OPEC Annual Statistical Bulletin (Organization of the Petroleoum Exporting Countries, Vienna), various years, http://www.opec.org.

Nevertheless any multilateral sanctions had the potential to wreak widespread damage. In

2002 trade constituted 49% of Iran’s GDP.297 The potential for international sanctions to inflict damage was greater at this time when Iran was rejoining world economic relations after a prolonged period of isolation following the Iran-Iraq war. The increasing role of international trade at this time is seen from the following graph.

297 World Bank, WDI Online, (World Development Indicators), http://databank.worldbank.org/ddp/home.do?Step=12&id=4&CNO=2.

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Figure 7.6 Trade as a Proportion of Iran’s GDP

Source: Plotted based on data from World Bank, WDI Online, (World Development Indicators), http://databank.worldbank.org/ddp/home.do?Step=12&id=4&CNO=2.

The potential for sanctions to inflict economic harm was particularly high during this period as Iran was seeking foreign investment in its oil and gas sector. After the first debt crisis in 1993, the National Iranian Oil Company (NIOC) invited foreign investment in the form of

“buyback” projects, where the foreign firm would first invest and begin to receive payments only when the sale of crude oil began.298 Although very promising in its scope for further foreign investment, the scheme seems to be a magnet for domestic and international politics –

Iran has been unhappy with the terms of the buyback deals; the conservative parliament elected in the spring of 2004 objected to new plans to attact other investors; charges of corruption and malpractice by the officials involved; and uncertainty surrounding the speculation of

298 Since 1995, when the first such deal was signed, Iran received an estimated $15-20 billion as investment in its oil and gas industry. Economist Intelligence Unit, Country Profile Iran, 2005, 39-40. 428

international sanctions.299 Thus any international ban on such investment in the Iranian oil industry could potentially have far-reaching consequences.

(b) Motivational Changes in Restraint 2

This longer subsection argues that referral to the Security Council – which was understood to imply a real threat of sanctions -- played a critical role in motivating Restraint 2.

It is commonly held that the immediate push for the Tehran Agreed Statement and the Paris

Agreement was the fear of sanctions.300 Iranian negotiators worked hard to avoid referral. For example even after the Tehran Declaration they lobbied hard, and succeeded, to prevent terminology on “noncompliance” at the November meeting of the IAEA Board.301 Indeed, avoiding referral was considered the principal Iranian victory between 2003 and 2005.302 The threat of sanctions appears to have been influential due to a number of factors such as EU negotiations, intelligence findings and the exposure of the A. Q. Khan network, the recently begun war in Iraq, and rumors that the United States may use military force against Iran (Miller

2007, 552-553). These motivations for restraint are discussed below as falling into the categories of the security, prestige, and domestic politics models.

Security Model

This sub-section argues that Iranian officials were motivated to avoid referral to the

Council by the key consideration of the security threat implications of such referral. Restraint 2

299 Economist Intelligence Unit, Country Profile Iran, 2005, 40-41.

300 Elaine Sciolino, “Iran Will Allow UN Inspections of Nuclear Sites”, New York Times, October 22, 2003; Ray Takeyh, Guardians of the revolution Iran and the world in the age of the Ayatollahs (New York: Oxford University Press, 2009), 247.

301 Karl Vick, “Iranian Hard-Liners Wary of Nuclear Deal; UN Agency to Weigh Action on Past Violations”, Washington Post, November 20, 2003; Mousavian, Iran-Europe Relations, 163.

302 Chubin, Iran’s Nuclear Ambitions, 101.

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occurred against the backdrop of Operation Iraqi Freedom, when the United States led an international coalition to oust the regime of Saddam Hussein on the justification of Iraq’s pursuit of nuclear weapons. There is some evidence that Iran, which was also accused of violating the NPT, perceived serious threats in this international context. The analysis here maintains that Iranian decision-makers slowed down the nuclear program in the expectation that this would prevent the imposition of UN sanctions, and would concomitantly reduce the chances of any US-led international military action against Iran.

Since 9/11 a number of developments -- such as the American doctrine of “preemption” or prevention, the naming of Iran as a member of the “axis of evil”, and the 2003 Iraq war -- all came together to present a heightened security threat perception for Iran.303 After postponing

IAEA inspections at the newly revealed facilities at Natanz and Arak, Iran agreed to a visit by

Director General ElBaradei and a team of inspectors in February 2003. This may have been motivated by the strong international mood against proliferation – the United States was preparing to attack Iraq; and North Korea had just withdrawn from the NPT.304 Threat perceptions emanating from the Iraq war appear to have directly affected aspects of Iran’s nuclear program in terms of hiding or shelving certain activities. For example, Iran dismantled centrifuge equipment at Kalaye as the war began in the spring of 2003 and relocated it to Natanz in October 2003305. Similarly, work on the P-2 centrifuge also stopped in 2003; and laser enrichment equipment was dismantled in May 2003.306

303 Miller, “Proliferation Gamesmanship”, 576.

304 ElBaradei, Age of Deception, 113.

305 IAEA Report, August 26, 2003.

306 IAEA Report, November 10, 2003, 8; IAEA Report, February 24, 2004.

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Iran’s threat perceptions were best exemplified in an unusual proposal offered soon after the start of the Iraq war. In May 2003 Iranian officials contacted former Swiss ambassador to

Iran Tim Guldimann to offer a proposal to the United States.307 The Iranian Roadmap remains to date one of the most far-reaching offers by Iran to resolve the nuclear crisis.308 Among other issues, it held that Iran would accept the Additional Protocol and be fully transparent about the nuclear program if it was allowed access to peaceful nuclear technology and relieved of all US sanctions.309 Iranian leaders appear to have been motivated by the ongoing war in Iraq, and the encirclement by US forces to the east and west.310 However, the United States rejected the offer due to doubts about its seriousness and reservations about alleged Iranian support for Al

Qaeda.311

Against this background, the possibility of bringing the Iran case before the Security

Council -- as threatened by the IAEA Board resolution of September 2003 -- generated an

“uncomfortable parallel with Iraq”.312 It raised the danger of a US-led military intervention in

307 Switzerland acted as a liaison to represent US interests since the latter had broken off diplomatic relations in 1979.

308 It was reportedly approved by Iran’s top leadership including Supreme Leader Khamenei. Glenn Kessler, “2003 Memo Says Iranian Leaders Backed Talks”, Washington Post, February 12, 2007. Trita Parsi, Treacherous Alliance: The Secret Dealings of Iran, Israel, and the United States (New Haven: Yale University Press, 2007), 244-245.

309 Roadmap for Comprehensive Negotiations with the United States, May 2003, accessed April 19, 2011, http://www.media.washingtonpost.com/wp-srv/world/documents/us_iran_roadmap.pdf.

310 Bowman, “The ‘Demand-Side’”, 633; Fitzpatrick, ed., Iran’s Nuclear, Chemical, and Biological Capabilities, 11, 18; Green et al, Understanding Iran, 40; Khan, Iran and Nuclear Weapons, 104; Parsi, Treacherous Alliance, 243. With the invasion of Iraq, Iran was encircled by the United States in Afghanistan, Iraq, and Turkey (as a NATO member). In addition another neighbor Pakistan had recently renewed its strategic relationship with the United States. Gerard Quille and Rory Keane, “The EU and Iran: towards a new political and security dialogue”, ed., Shannon N. Kile, Europe and Iran, 99.

311 Since the offer was made through secret channels, American officials such as Deputy Secretary of State Richard Armitage were unsure if it was meant as a serious communication from Iran with the backing of senior officials. Glenn Kessler, “2003 Memo Says Iranian Leaders Backed Talks”, Washington Post, February 12, 2003.

312 Saeed, Redefining Success, 26.

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Iran on the grounds of nuclear proliferation. Indeed, then nuclear negotiator Hassan Rowhani has stated that in June 2003, when Iran was discussed by the IAEA Board, “we felt a threat, a sense of danger in the country. We thought that we might be facing a plot against Iran and that we might encounter some problems”.313 After the Board resolution, the possibility of a US strike on Iran was seriously considered by the average Iranian.314 Averting such an eventuality became an important goal for Iran, and was considered one of the most important achievements of the

Tehran Declaration.315

These military threat perceptions appear to have accentuated in the latter half of 2003, with several signals from the United States about a possible US-led attack. For example,

Undersecretary for Arms Control and Security John Bolton echoed President Bush’s position that “all options are on the table”.316 Such threat perceptions may have encouraged Iranian leaders to seek an easier way to close the nuclear file.317 In June 2003 the EU passed a

Declaration on Non-Proliferation of Weapons of Mass Destruction, which evolved into a joint strategy for dealing with proliferation.318 In reference to Iran, the EU stated that military action

313 Rowhani, “Text of Speech to the Supreme Cultural Revolution Council”. In fact Rowhani attributes the timing of the IAEA Board discussion on Iran (in May-June 2003) to “America’s victory in Iraq”, when Americans allegedly “started to think that conditions were right for them to raise the issue of Iran at the meeting of the IAEA Board of Governors and to pave the way for sending the case to the UN Security Council. The idea was to plan sanctions or even military operations against Iran, or at least put political and economic pressure on this country.” Rowhani, “Text of Speech”, emphasis added.

314 Mousavian, Iran-Europe Relations, 151.

315 Mousavian, Iran-Europe Relations, 156; 160.

316 “Iran Nuclear Installations: Interview with John Bolton”, June 20, 2011, accessed April 28, 2011, http://news.bbc.co.uk/2/hi/programmes/newsnight/archive/3007144.stm.

317 Nazila Fathi, “Iran Says It May Pre-empt Attack Against Its Nuclear Facilities”, New York Times, August 20, 2004.

318 The strategy envisioned a variety of tools for combating WMD proliferation including diplomacy, political and economic levers, greater cooperation with the United States, and military coercion where necessary. Christer Ahlström, “The EU Strategy against Proliferation of Weapons of Mass Destruction”, ed. Kile, Europe and Iran.

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might be required as a final means to avoid nuclear proliferation.319 These indications against the background of US military successes in Afghanistan and Iraq likely conveyed the serious possibility of military strikes.320 Concerns about possible military attacks on Iran’s nuclear facilities by Israel backed by the United States also strengthened by 2004.321

What role did sanctions play in these threat perceptions? The immediate trigger for the

Tehran Agreed Statement, which precipitated Restraint 2, came in the IAEA Board resolution of

September 2003 threatening referral to the Security Council if Iran did not suspend enrichment and reprocessing. The United States, which was strongly pushing for the IAEA to declare Iran to be in non-compliance with the NPT,322 stated that this was Iran’s “last chance” to comply with

Board requests.323 Clearly, the immediate motive for the Tehran agreement, -- which was struck just a few days before the deadline of October 31 set by the Board -- was to avoid UN censure.324 The expectation of sanctions was an important motivation for Iran to make the concessions.325

319 “Iran Must Allow Nuclear Inspections”, Al Jazeera, June 16, 2003, accessed April 28, 2011, http://english.aljazeera.net/archive/2003/06/200849135643607188.html.

320 Fitzpatrick, Iranian Nuclear Crisis, 33; Chubin, Iran’s Nuclear Ambitions, 66; Khan, Iran and Nuclear Weapons, 101-102.

321 Israel began making references to possible attacks on the Natanz enrichment facility at least by September 2003. Mark Hibbs, “Iran-EU deal hinges on Iran disclosures, EU supply assurances”, Nucleonics Week, 44 no. 43 (2003).

322 The United States strongly advocated that the IAEA declare Iran to be in non-compliance at the IAEA general meeting in September 2003. Hibbs, “Iran-EU deal hinges on Iran disclosures”. Although the Agency did not do so, in September it placed a deadline for Iran to remedy its reporting failures by October 31.

323 Kerr, “Concern Heats Up Over Iran’s Nuclear Program”.

324 Hibbs, “Iran-EU deal hinges on Iran disclosures”.

325 Taylor, Sanctions as Grand Strategy, 62; Fitzpatrick, Iranian Nuclear Crisis, 33; “UN Sets Deadline for Iran on Nuclear Arms”, New York Times, September 13, 2003. In the negotiations the E3 nations also conveyed the threat of disrupting economic relations, specifically that expanding existing commercial ties as well as future membership in the WTO would be jeopardized by Iran’s lack of cooperation. Pollack, Persian Puzzle, 365.

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The threat of referral to the Council was accompanied by the assurance that it could be avoided if Iran suspended enrichment and reprocessing, and adopted the Additional Protocol.

This expectation was specified in the Tehran Agreed Statement and assured by the

Europeans.326 The EU also offered the possibility of cooperation on the civilian nuclear program if Iran suspended enrichment and accepted the Additional Protocol.327

Iranian acquiescence in the Paris Agreement can also be attributed to the threat of sanctions as implied by the warning of referral to the Council.328 This time the IAEA Board had demanded the immediate stop to all enrichment activities and threatened referral to the Council in the event of non-compliance. The E3 and Iran engaged in talks for 23 hours in an effort to meet the Board’s deadline.329

The Paris Agreement was facilitated by E3 assurances to make efforts for the eventual normalization of relations.330 It recognized Iran’s right to peaceful nuclear technology and viewed the suspension of enrichment and reprocessing activities as a purely voluntary

326 “Tehran Agreed Framework”, paragraph 3. Rowhani states, “The most important promise that they [E-3] made to us was that they would stand firm against attempts to take this case to the UN Security Council and work to solve the problem within the framework of the IAEA.” Rowhani, “Text of Speech”.

327 “Europe Offered Iran Nuclear Carrot”, Al Jazeera, September 20, 2001, accessed April 28, 2011, http://english.aljazeera.net/archive/2003/09/200849132640235249.html.

328 Fitzpatrick, Iranian Nuclear Crisis, 33; Anthony H. Cordesman and Khalid R. Al-Rodhan, Iran’s Weapons of Mass Destruction: The Real and Potential Threat (Washington, D.C. : Center for Strategic and International Studies, 2006), 136; Mousavian, Iran-Europe Relations, 176.

329 Mousavian, Iran-Europe Relations, 175.

330 ElBaradei, Age of Deception, 141; Mousavian, Iran-Europe Relations, 176.

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gesture.331 These assurances helped assuage Iran that the “anti-Iran propaganda” was being reduced and the threat of sanctions and military strikes were being “eliminated”.332

Thus Iran agreed to Restraint 2 due to the expectation that military and economic threats would recede. Despite emerging and continuing differences between the two sides (i.e. Iran and the West), the threat of sanctions imposition by the Security Council was successfully averted until mid-2005.

The unraveling of the agreement on enrichment suspension began seriously in early 2005.

The United States held that the only “objective guarantee” on the peaceful nature of the nuclear program was the permanent cessation of enrichment activities. For Iran, such a demand deviated significantly from the terms of the Paris Agreement, which had viewed such suspension as purely ‘voluntary’. Despite these mounting differences, Iran’s deep interest in resolving the matter without referral to the Council is seen in the several proposals it offered in the early months of 2005. Some of the measures Iran proposed to undertake were significant. Restraint 2 finally ended with the resumption of uranium conversion in August 2005. Such resumption may have been facilitated by a decline in the urgency of the security threat as the United States became bogged down in Iraq.333 At least it seems that the negotiations stalled in mid-2005 due to the perception of a stronger negotiating position for Iran.334 At the same time, Iran seemed to face sufficient Western hostility as to warrant the pursuit of fuel cycle capability. For example

331 It stated that Iran was suspending enrichment “on a voluntary basis” and that “The E3/EU recognize that this suspension is a voluntary confidence building measure and not a legal obligation”. “Paris Agreement”.

332 Mousavian, Iran-Europe Relations, 176.

333 Rowhani, “Text of Speech”.

334 Kile, “Nuclear arms control” (2006), 623.

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Iran rejected a proposal by the E3 in August 2005 at least in part due to the absence of adequate security assurances.335

Prestige Model

Iranian leaders may also have been motivated to undertake Restraint 2 in order to avoid being regarded as a total international pariah. Iranian officials have cast the negotiations themselves as a sign of international recognition for Iran.336 As accusation of weapons pursuit mounted in mid-2003, some Iranian leaders talked of withdrawing from the NPT if the United

States forced Iran to permanently give up enrichment.337 Iran seemed to walk a tightrope where accusations of violating NPT commitments undermined its international prestige, while submitting entirely to Western demands to cease all enrichment would also significantly reduce prestige. Acknowledging Iran’s concerns about avoiding complete capitulation to Western pressure, the E3 made some concessions. For example, the Iranians were adamant about

“suspending” enrichment rather than completely stopping it;338 the Tehran Declaration entailed a statement about upholding Iran’s sovereignty – a direct reference to eschew the type of aggressive inspections in Iraq.339

335 The security affirmations in the proposal were simply “reaffirmations of existing international obligations rather than security guarantees involving the United States.” Bali, “At the Nuclear Precipice”, 105.

336 Rowhani has observed that it was unprecedented for the three E-3 foreign ministers to travel to a common site to resolve one particular issue; and that these negotiations were only the third set of international negotiations for the Islamic Republic – the other two being discussions with the United States on the hostages and with Iraq on the ceasefire. Rowhani, “Text of Speech”.

337 Kerr, “Concern Heats Up Over Iran’s Nuclear Program”.

338 Mousavian, Iran-Europe Relations. Rowhani repeatedly clarified that the suspension was voluntary. ElBaradei, Age of Deception, 141.

339 Karl Vick , “Iranian Hard-Liners Wary of Nuclear Deal”.

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Another set of prestige-related motives for Restraint 2 pertained to the emerging evidence of Iran’s clandestine nuclear activity, indicating its violations of the NPT.340 Upon being repeatedly confronted with intelligence findings -- particularly those following the unraveling of the Khan network – Iran had few face-saving options but to admit to these activities. It therefore made some admissions in the months after the Tehran Declaration. For example, it acknowledged receiving uranium compounds from China after the latter disclosed this to the

IAEA; and admitted using nuclear material to test centrifuges.341 The IAEA found evidence of plutonium experiments, which had not been admitted by Iran. Similarly, the interdiction of a ship delivering centrifuge parts to Libya from the network in October 2003 likely raised the stakes since the IAEA had recently established it as a source of centrifuge technology for

Iran.342 In the spring of 2004 Iran retracted its previous statements and clarified that it had received designs for P-2 centrifuges from the network. This followed revelations from a network member, B. S. Tahir of the sale he had undertaken in the mid-1990s.343 New findings by the IAEA regarding suspected activities also increased the pressure on Iran.344 Besides dispersing some of Iran’s major nuclear sources, such intelligence findings likely generated

340 In 2004 the IAEA listed a total of 14 counts of violations of the safeguards agreement, all of which were reporting failures. In addition, the Agency noted some efforts at obstructing inspections through concealment. IAEA Report, November 15, 2004, paragraph 86.

341 Iran initially told the IAEA that its centrifuge program was entirely indigenous and that it had not involved the introduction of uranium hexafluoride, but by the summer of 2003 the IAEA concluded that this was not possible, leading to the admission of foreign assistance. In October 2003 Iran also admitted having used uranium hexafluoride in centrifuges. IAEA Report, August 27, 2003; IAEA Report, November 10, 2003.

342 Miller, “Proliferation Gamesmanship”, 553, 580; Fitzpatrick, Iranian Nuclear Crisis, 33.

343 Thérèse Delpech, Iran and the Bomb: The Abdication of International Responsibility (New York: Columbia University Press, 2007), 14.

344 In its Board resolution of March 2004 the IAEA noted the following concerns on Iran’s nuclear program – the possession of P-2 centrifuge drawings, activities using Polonium-210, and contamination of enriched uranium (both LEU and HEU) at Kalaye Electric Company and Natanz. IAEA Report, March 13, 2004, paragraphs 4-6.

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prestige incentives for Iran to undertake restraint. However these prestige motives were not the critical reason for Restraint 2.

Domestic Politics Model

Any decision on nuclear restraint must necessarily be taken by leaders functioning within a domestic regime. A look at some of Iran’s internal politics shows how various factions largely united at a time of perceived common threats to the regime. Although decision-making in Iran is famously known to be diffuse with an array of influential actors, the semi-authoritarian style and a common perception of threats facilitated a more unified approach on nuclear restraint than would otherwise have been possible. The effects of the larger international landscape discussed above reverberated throughout the domestic political system to produce a rough consensus on restraint. This sub-section argues that decision-makers were convinced on the need for nuclear restraint in order to avoid international sanctions.

Foreign policy in Iran is led by individuals rather than institutions.345 The supreme leader leaves his indelible mark on foreign policy by affecting the decision of the Supreme National

Security Council, the body deemed to make major foreign policy decisions.346 Similarly the political success of the president depends on the pleasure of the supreme leader.347 Supreme

Leader Seyyed Ali Khamenei is known to be far weaker than Khomeini partly because of the latter’s unmatched charisma, and partly due to the former’s poor clerical credentials.

345 Byman et al, Iran’s Security Policy, xi.

346 Wilfried Buchta, “Iran’s Security Sector: An Overview”, Paper presented at Challenges to Security Sector Governance in the Middle East, Geneva, July 12, 2004, 16; Byman et al, Iran’s Security Policy, 11; Green et al, Understanding Iran, 11; Abbas Maleki, “Decision Making in Iran’s Foreign Policy: A Heuristic Approach”, Undated, 7, accessed April 18, 2011, http://www.caspianstudies.com/article/Decision%20Making%20in%20Iran=FinalDraft.pdf.

347 Cook and Roshandel, United States and Iran, 43.

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Nevertheless if not in other ways, Khamenei certainly places his stamp on policy-making at least through his ability to disapprove of a particular policy or “negative power”.348

Nuclear restraint after the Tehran Declaration was made possible by the domestic political convergence ushered in by Khamenei’s approval.349 It seems that the key consideration for domestic political actors at this time was the security threat indicated by a referral to the

Security Council.350 Thus sanctions acted as a signal of security threats. Sanctions may also have conveyed a danger of economic constraints for the regime. Restraint 2 may have been precipitated by a consideration of the possible economic challenges that would accompany open defiance of Western demands. Iran already dealt with wide-ranging economic problems and structural inefficiencies aggravated since the war. However, as described earlier and shown in the graph below, the economy began to grow in the 2000s under rising oil prices.

Figure 7.7 Iran’s Improving Oil Income

348 Green et al, Understanding Iran, 7-8.

349 Mousavian, Iran-Europe Relatons, 162.

350 Rowhani, “Text of Speech”.

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Source: Plotted based on data from OPEC Annual Statistical Bulletin (Organization of the Petroleoum Exporting Countries, Vienna), various years, http://www.opec.org.

International sanctions held the potential to disrupt this tide. Concomitantly, the ending of

Restraint 2 seems to have been at least partly driven by an improving economic situation under rising oil prices.351

The regime nevertheless witnessed the usual wrangling among various factions on the best course of action. The related bureaucratic and scientific organizations involved in the nuclear program sought to promote their own vested interests, and protested strongly against

Iran’s decision to implement the Additional Protocol.352 The most important of these are the

AEOI and the Iranian Revolutionary Guards Corps (IRGC).353 The nuclear program is itself controlled by the IRGC and any development as well as command and control of nuclear weapons would be undertaken by it.354 Ultimately, however, the IRGC remains under the purview of the supreme leader.355

Different factions of the top echelons of Iran’s semi-hierarchical regime had different approaches to the nuclear program and the negotiations with the West. Traditional conservatives like Ahmadinejad and supreme leader Khamanei seemed to support a nuclear weapons option and did not favor major concessions to the West; pragmatists like former president Rafsanjani and the nuclear negotiator Rowhani preferred to continue the nuclear program but normalize relations with the West; and the reformers like President Khatami sought to stay well within the

351 ElBaradei, Age of Deception, 191.

352 Takeyh, Hidden Iran, 156.

353 Green et al, Understanding Iran, 31-32.

354 Buchta, “Iran’s Security Sector”, 8; Green et al, Understanding Iran, 12.

355 Byman et al, Iran’s Security Policy, xiii.

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confines of the NPT and compromise with the West to assuage international concerns.356

However such differences were relatively minor at this time, probably due to a common perception of serious external threats.

Cohesiveness among decision-makers seems to assist steps toward nuclear restraint.357

Cohesiveness tends to be more prevalent in the context of a clear, credible military threat such as in the context of Operation Iraqi Freedom.358 It was easier to achieve consensus on nuclear reversal in 2003 and 2004 due to the perceived threats arising from US foreign policy since

9/11. Both the Tehran Agreed Statement of October 2003 and the Paris Agreement of November

2004 were immediately preceded by IAEA Board resolutions threatening referral to the Security

Council with an explicit deadline. That environment helped lessen the typical differences between the reformist government of President Mohammad Khatami and the more conservative positions from the office of the supreme leader. Moreover, the appointment of Hassan Rowhani as chief nuclear negotiator appears to have facilitated the decision on restraint; achieving some agreement between the different factions was made possible by his pragmatist position.359

356 Chubin, Iran’s Nuclear Ambitions, 32-33; Green et al, Understanding Iran; Karim Sadjadpour, “Iran’s Political/Nuclear Ambitions and US Policy Options”, Testimony before the US Senate Foreign Relations Committee, May 18, 2006, ed. Michel Korinman and John Laughland, Shia Power: Next Target Iran? (Portland: Vallentine Mitchell Academic, 2006).

357 Kayhan Barzegar, “The Paradox of Iran’s Nuclear Consensus”, World Policy Journal, 26 no. 3 (2009); Maleki, “Decision Making in Iran’s Foreign Policy”, 6. Barzegar’s main point is that only a strong and self-confident Iranian government will be able to make conclusive agreements with the United States. However, the experience of negotiations post-2002 shows that Iran has undertaken restraint when regime leaders believed they faced real and urgent threats to their security.

358 Buchta, “Iran’s Security Sector”, 17; Maleki, “Decision Making in Iran’s Foreign Policy”, 10. Indeed since the early days of the Republic, the emphasis on consensus arose from the concern that internal conflicts could otherwise put the system’s very survival at stake.

359 Hibbs, “Iran-EU deal hinges on Iran disclosures”. Rowhani was appointed to this newly created position in 2003 based on “consensus among high-ranking officials.” Mousavian, Iran-Europe Relations, 156. As Secretary of the Supreme National Security Council, he represented the interests of Supreme Leader Khamenei. Khamenei reportedly appointed him as chief nuclear negotiator due to his proximity to the conservative clergy. (Rowhani was himself a cleric). “Profile: Hassan Rowhani”, BBC, November 30, 2002, accessed May 22, 2012, http://news.bbc.co.uk/2/hi/middle_east/3240618.stm. 441

Indeed there was “considerable convergence” among domestic political actors in support of the

Tehran Declaration.360

It is perhaps not surprising that Iran’s phase of nuclear restraint in 2003-2005 occurred during the presidency of the reformist Khatami.361 At the same time, however, the breakdown of the Paris Agreement was at least partly driven by Khatami’s political isolation due to his reformist stance. The unraveling of the agreement was further bolstered by the election of the conservative Ahmadinejad as President in June 2005.362 The newly appointed nuclear negotiator, Ali Larijani, was also more conservative than his predecessor. He had criticized the

Paris Agreement.363 The change in the government towards a more conservative stance sealed the ending of Restraint 2. The new leaders represented what has been called the “New Right”, a group of individuals who were religiously conservative and had a strong commitment to the revolution as in the days of Khomeini.364

Ultimately, however, ideology does not seem to be the determining factor of Restraint 2, which was driven more by considerations of security and international isolation.365 Also, there is

360 Mousavian, Iran-Europe Relations, 162.

361 Alireza Nader, “Influencing Iran’s decisions on the nuclear program”, ed. Solingen, Sanctions, Statecraft, and Nuclear Proliferation, 220.

362 The rise of the conservatives is itself partly attributable to the failure of the E-3 to respond to Iran’s many proposals in the earl months of 2005. Saeed, Redefining Success, 31.

363 Kasra Naji, Ahmadinejad :The Secret History of Iran's Radical Leader (Berkeley : University of California Press, 2008), 125.

364 According to Takeyh, restraint was nearly impossible under this leadership since it was seen as a concession to the West; and the West, led by the United States, was unable to accept or accommodate Iran’s revolution. Takeyh, Guardians of the Revolution, 223-225.

365 For example, the unraveling of the Paris Agreement had started in the spring of 2005, before the election of President Ahmadinejad in June 2005.

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continuity in Iranian policy as the country has had the same supreme leader since 1989.366 He remains the final decider of the nuclear program, which has largely reflected his conservative but practical position.367 Another factor that appears to have facilitated the decision on restraint was that the Iranian public had not yet come to view the nuclear program as a matter of national pride.368

Table 7.4 Summary of Iran’s Restraint 2 (slow) 2003-2005

Causes of restraint Present? Resource Constraints: Techological No Did sanctions impose significant resource constraints on NW Financial No program? Motivational Changes: Security Yes Did sanctions induce motivational changes in NW program? Domestic Politics No

Prestige No

Pursuit 2006-2010

Iran abided by the Paris Agreement until August 2005 when it resumed uranium conversion, which had been suspended since November 2004.369 In 2006 it started the

366 Mousavian 2011.

367 Nader, “Influencing Iran’s decisions on the nuclear program”, 222.

368 Mousavian, Iran-Europe Relations, 151. Indeed it is said that Iranians had almost no knowledge on the nuclear program until the public revelations of 2002. Saeed, Redefining Success, 28. This shift was accomplished during the presidency of Mahmoud Ahmadinejad due to a combination of his rhetorical skills and the increasing public international pressure on Iran to submit to Western demands. Barzegar, “Paradox of Iran’s Nuclear Consensus”, 24.

369 From Iran’s point of view, the failure to close Iran’s nuclear file at the IAEA coupled with the breakdown of negotiations justified its ending of suspension, which was in any case ‘voluntary’. Thus Iran believed that the unraveling of the agreement was brought on by the West’s intransigence and discriminatory non-proliferation policies.

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enrichment process at Natanz370 and by 2010 it achieved a substantial enrichment capability.

Iran also started another secret centrifuge enrichment plant near Qom around 2006-07, which was made public in 2009. This section considers whether sanctions in any way dampened nuclear pursuit at this time. It shows that sanctions appear to have imposed few resource constraints on the program. Although they periodically induced Iran to undertake negotiations, their failure (due to a variety of reasons) meant that in the end, sanctions did not persuade restraint. Strikingly, far from persuading restraint, sanctions may have in fact deepened Iran’s motivations for nuclear weapons capability since 2006.

Although the nuclear program, particularly centrifuge enrichment, grew overall in this period, progress was not uniform. There were three instances when enrichment activity slowed down. This period began with the testing of centrifuges with uranium hexafluoride in February

2006. However by the summer of 2006 the IAEA noted that enrichment activity was not sustained – the centrifuges would run for a time with nuclear material, and periodically stop.371

In early 2007 the installation of centrifuges proceeded rapidly. By May 2007 top IAEA personnel believed that Iran had achieved the knowledge capability for enrichment, having executed enrichment to the 5% level.372 Since 2009 the program was beset by external attacks in the form of targeted assassinations of nuclear scientists and the spread of computer worms at

Natanz. This section examines whether sanctions slowed down the progress of the nuclear program post-2005.

370 ElBaradei notes that Iran did not perceive its enrichment activity at the pilot plant at Natanz as a violation since enrichment was after all its right under NPT, and Iran’s suspension of enrichment so far had been purely voluntary. Indeed ElBaradei writes, “the Iranians felt confident that there would be no negative repercussions” to resuming enrichment at the pilot facility, and that they would resume negotiations with the E-3 and agree to suspend enrichment at the industrial scale. ElBaradei, Age of Deception, 192.

371 ElBaradei, Age of Deception, 197.

372 ElBaradei, Age of Deception, 251. 444

Resource Constraints and Motivational Factors in Pursuit 2006-10

It has already been stated that the nuclear program displayed overall progress after 2005, when Iran ended the voluntary suspension of key fuel cycle activities. However, as shown above, this phase was characterized by intermittent stints of sustained activity (rapid progress) followed by periods of slower progress. This sub-section considers whether the instances of slow growth were driven by resource constraints or by motivational factors. It concludes that the predominant cause of slow growth has been resource constraints due to technical problems and external attacks. The following table lists the key instances of this period when the enrichment program373 proceeded more slowly than expected.374

Table 7.5 Iran’s centrifuge enrichment program since 2006

Enrich- Pace of Resource Date Activity ment Level Nuclear Constraints/ Pursuit Motivational Summer Iran experimenting with one 164-centrifuge Iran: 5% Resource – Fall cascade at the pilot enrichment plant at IAEA: Slow (technical) 2006 Natanz375 4.2% constraints376

Oct. 2006 Installed total of ten 164-centrifuge cascades – Spring at the industrial scale plant and constructing -- Rapid378 2007 three more377

373 The centrifuge program is used here as a proxy for the pace of the nuclear program in the post-2005 period.

374 By “expected” I refer to IAEA expectations of Iranian capabilities as well as official Iranian declarations of what it intended to do.

375 Centrifuge testing at the pilot plant was slower than IAEA experts had believed Iran capable – the 164-centrifuge cascade would run for 10 days, stop, and restart. ElBaradei, Age of Deception, 197, 205. IAEA Report, August 31, 2006, 2. Iran introduced uranium hexafluoride into the 164-machine cascade at the pilot plant in March 2006. IAEA Report, April 28, 2006, 7. But the feeding of uranium hexafluoride was intermittent between June and November 2006. Moreover, although Iran declared enrichment levels of 5%, the IAEA only found evidence of enrichment up to 4.2%. IAEA Report, August 31, 2006, 2; IAEA Report, February 22, 2007, 2; IAEA Report, November 14, 2006, 1.

376 Iran is believed to have had technical difficulties with centrifuge operation. Centrifuges reportedly broke down after overheating. David Ignatius, “Iran’s Uranium Glitch: Technical Troubles Offer Time for Diplomacy”, Washington Post, September 29, 2006.

377 Iran introduced uranium hexafluoride at the industrial-scale enrichment plant in April 2007. David Albright, Jacqueline Shire and Paul Brannan, IAEA Safeguards Report on Iran: Iran making progress but not yet reliably 445

Spring Iran did not build new cascades and fed less Iran: 4.8% Slow Resource 2007 – nuclear material into the centrifuges at the IAEA: 4% (technical) Early industrial scale plant.379 constraints380 2008

Spring Rapidly feeding UF6 into industrial scale -- Rapid 2008 – plant;381 Iran reveals new underground pilot Late 2009 enrichment plant near Qom. I Late Reported slow down in feed rate of uranium AEA: Slow Resource 2009- hexafluoride at industrial scale plant, as well Average (technical) Fall 2010 as in centrifuge efficiency382 3.37%383 constraints operating an enrichment plant (Washington, D.C.: Institute for Science and International Security, 2007), May 25, 1, accessed May 31, 2012, http://isis-online.org/uploads/isis-reports/documents/IranSafeguards25May2007.pdf; ElBaradei, Age of Deception, 251.

378 IAEA experts believed that Iran now had attained almost the full knowledge for enrichment. ElBaradei, Age of Deception, 251. Nevertheless the feed rate of uranium hexafluoride may have been slower than anticipated by Iranian officials. Albright et al, IAEA Safeguards Report (2007), 2.

379 ElBaradei, Age of Deception, 266, 282; Peter Crail, “Iran Starts New Centrifuge Installation Campaign”, Arms Control Today, 38 no. 4 (2008), 43. IAEA reports noted that uranium hexafluoride was being fed into the industrial scale enrichment plant at Natanz at a much lower rate than the plant’s capacity. IAEA Report, November 15, 2007, 6; IAEA Report, August 30, 2007, 1; IAEA Report, February 22, 2008, 7. Iran’s representative to the IAEA, Ali Asghar Soltaniyeh, stated in April 2008 that the enrichment program was facing some hiccups. Crail, “Iran Starts New Centrifuge Installation Campaign”, 43. Moreover, between February and May 2007 the IAEA found enrichment only up to 4% although Iran declared enrichment of 4.8% at the industrial scale plant. IAEA Report, May 23, 2007, 2; IAEA Report, November 15, 2007, 6. Another indication of the slow progress in enrichment at this time is that in January 2007 Iran informed the IAEA that it would begin operating 18 cascades at the plant by May; however this was delayed by six months, and the 18 cascades began operating with uranium hexafluoride in November 2007. IAEA Report, February 22, 2007, 2; IAEA Report, November 15, 2007, 6.

380 It seems that the slow progress at this time was mainly due to the poor quality of centrifuges, several of which were unstable and broke. David Albright, Jacqueline Shire and Paul Brannan, IAEA Safeguards Report on Iran: Centrifuge Operation Improving and Cooperation Lacking on Weaponization Issues, Rev 2 (Washington, D.C.: Institute for Science and International Security, 2008), May 29, 2, accessed May 31, 2012, http://isis- online.org/uploads/isis-reports/documents/ISIS_Iran_IAEA_Report_29May2008.pdf.

381 Between February and December 2007 Iran had fed only 1670 kg uranium hexafluoride into the industrial scale plant, producing LEU with enrichment of 3.8%. IAEA Report, February 22, 2008, 7. However between December and May 2008 Iran fed 2300 kg UF6 into the plant. IAEA Report, May 26, 2008, 1. By November 2008 Iran had produced 839 kg LEU, which the IAEA has verified to be enriched to 3.49%. IAEA Report, February 19, 2009, 1-2.

382 A computer worm, known as Stuxnet, appears to have disabled several hundred centrifuges from 2009. This is discussed below. IAEA inspectors noted that at one point, in November 2010, the industrial plant at Natanz was not being fed with uranium hexafluoride. IAEA Report, November 23, 2010, 2. Further, centrifuge efficiency appeared to have declined since the plant was producing roughly the same quantity of LEU despite operating an additional 1,000 centrifuges (since September) in November 2010. William J. Broad, “Report Suggests Problems With Iran’s Nuclear Effort”, New York Times, November 23, 2010.

383 IAEA Report, November 23, 2010, 2. 446

In the post-2005 period Iran’s nuclear program has faced several setbacks, which largely appear to be the result of resource constraints. The table above has identified three key instances of relative slow growth in enrichment activity. It is important to note, however, that these elements of slow growth are within a larger phase of nuclear pursuit since Iran’s fuel cycle capability was incrementally increasing. As discussed below, these instances of slow progress in the nuclear program seem to be the result of resource constraints. There is no obvious evidence of a decline in motivations for the nuclear program at this time.

In the summer of 2006 it became evident that work on centrifuge enrichment was not proceeding as quickly as the IAEA had expected.384 At the time the Agency was uncertain as to whether this was intentional or simply caused by technical problems.385 However, the fact that the leadership did not seek mileage from the relatively slow progress of enrichment activity suggests that this was unintentional.386 Moreover, it is likely that Iran faced some technical hurdles since it had to go through several steps before being able to simultaneously run five cascades with uranium hexafluoride.387

A second instance of slow progress occurred in 2007 when Iran significantly slowed down the feed rate of uranium hexafluoride into centrifuges at the industrial scale enrichment

384 ElBaradei, Age of Deception, 197. In April 2006 it was expected that Iran would install five 164-centrifuge cascades by August 2006. However Iran still had only one completed cascade, while two others were believed to be close to completion. David Albright and Jacqueline Shire, Iran’s Centrifuge Program: Defiant But Delayed (Washington, D.C.: Institute for Science and International Security, 2006), August 31, accessed May 31, 2012, http://isis-online.org/uploads/isis-reports/documents/defiantbutdelayed.pdf.

385 ElBaradei, Age of Deception, 205.

386 Iranian leaders could have claimed to have slowed down the program as a conciliatory gesture.

387 First, Iran had to fix the roughly third of centrifuges that were damaged or broken following enrichment suspension; second, it had to repair the pipes that were corroded due to exposure to humidity during the suspension, and then connect them; third, it had to create a vacuum in the cascade; finally, it had to prepare it for introducing uranium hexafluoride (Albright and Hinderstein 2006, 3). David Albright and Corey Hinderstein, The Clock is Ticking, But How Fast? (Washington, D.C.: Institute for Science and International Security, 2007), March 27, 3, accessed May 31, 2012, http://isis-online.org/uploads/isis-reports/documents/clockticking.pdf.

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plant. The three IAEA reports between August 2007 and February 2008 talked of significantly low feed rate at the plant.388 This seems to have been caused by technical difficulties arising from the faulty P-1 components obtained from the Khan network. Perhaps due to these difficulties, Iran was working on four new centrifuge designs that were shown to the IAEA in early 2008, including a modified version of the P-2 centrifuge, which it called IR-2.389

The final aspect of slow progress occurred in 2009-2010 when the nuclear program faced some significant sabotage attacks that limited the pace of enrichment. These included cyber attacks as well assassinations of key scientists involved in the nuclear program. In 2008 a sophisticated computer worm known as Stuxnet reportedly began affecting centrifuges at

Natanz by introducing mechanical errors.390 News reports state that in January 2009 President

Bush ordered cyber attacks on the Natanz facilities.391 President Obama increased these efforts after taking office. Due to problems with some centrifuges, Iran reportedly took out of service some 984 interconnected centrifuges in 2009.392 In 2010 Stuxnet incapacitated nearly 1,000 centrifuges.393 Another cyber weapon called Flame was discovered in 2012. It was reportedly designed to collect information from the computers of senior Iranian officials and is believed to be five years old.394

388 IAEA Report, November 15, 2007, 6; IAEA Report, August 30, 2007, 1; IAEA Report, February 22, 2008, 7.

389 IAEA Report, February 22, 2008, 8.

390 Guilbert Gates, “How a Secret Cyberwar Program Worked”, New York Times, June 1, 2012. The software that has come to be known as Stuxnet was a joint US-Israeli effort. It was apparently tested on centrifuges at Israel’s Dimona nuclear facility. William J. Broad, John Markoff and David E. Sanger, “Israeli Test on Worm Called Crucial in Iran Nuclear Delay”, New York Times, January 11, 2011.

391 Broad et al, “Israeli Test on Worm Called Crucial in Iran Nuclear Delay”.

392 Broad et al, “Israeli Test on Worm Called Crucial in Iran Nuclear Delay”.

393 David E. Sanger, “Obama Order Sped Up Wave of Cyberattacks Against Iran”, New York Times, June 1, 2012.

394 Thomas Erdbrink, “Iran Confirms Attack by Virus That Collects Information”, New York Times, May 29, 2012. 448

Sanctions possibly affecting Pursuit 2006-2010

During this time the United States introduced a number of new sanctions on Iran for the specific purpose of making it harder to pursue nuclear weapons capability. It adopted targeted financial sanctions since 2005, aimed at particular agencies including the AEOI, IRGC, and major banks such as Bank Sepah, Bank Melli, and Bank Mellat.395 In 2010 it enacted the

Comprehensive Iran Sanctions, Accountability, and Divestment Act (CISADA). The act tightened the ISA sanctions to include the sale of refined petroleum products like gasoline, for which Iran depends on imports.396 CISADA also increased the sanctions requirement under ISA from the need to impose two sanctions out of a list of six possible sanctions, to requiring three sanctions out of a possible list of nine.397 Further, CISADA had stricter conditions for the

President to grant a waiver against the sanctions, now defined as a matter that was “necessary” to the national interest instead of “important” to the national interest.398

Following an IAEA report in November 2011 that highlighted concerns about work related to nuclear explosive technology, President Obama signed Executive Order 13590 placing further sanctions on foreign companies doing business with Iran.399

395 Fitzpatrick, Iranian Nuclear Crisis, 37-38.

396 Clawson, “US Sanctions” in ed. Wright, Iran Primer. CISADA also expanded the definition of “investing” in the Iranian oil sector to include pipelines and contracts to develop energy projects. Kenneth Katzman, “Iran Sanctions”, CRS Report for Congress, March 28, 2012, 2.

397 These include sanctions such as denying Exim Bank loans, denying US military exports, restrictions on imports, and prohibiting foreign exchange transactions to the entity concerned. Katzman, “Iran Sanctions” (2010), 4-5.

398 Katzman, “Iran Sanctions” (2010), 5.

399 According to this, the United States would impose at least one of the ISA sanctions on foreign firms that provided a $1 million (or more) worth of goods and services and could be used in its oil and gas industry; or $250,000 or more for use in its petrochemical industry. Katzman, “Iran Sanctions” (2012), 4.

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UN Sanctions

The UN Security Council passed its first resolution on the Iran nuclear issue in July 2006

(Resolution 1696), demanding an end to enrichment-related and reprocessing activities. With this resolution, the demand for Iran to cease these activities became an explicit legal requirement. Resolution 1696 also threatened to impose sanctions if Iran did not comply by 31

August 2006.

The first UN sanctions on Iran were imposed in December 2006 under Security Council

Resolution 1737, which was passed unanimously. It demanded a stop to all enrichment, reprocessing, and heavy-water related projects, and called on Iran to ratify the Additional

Protocol. It required states to stop supplying equipment and technology that might contribute to these banned activities, or to the development of nuclear weapon delivery systems.400 The resolution also obligated states to end financial or training assistance in these areas and froze the financial assets of 10 Iranian firms and 12 individuals involved in the nuclear program, including IRGC Commander Major General Yahya Rahim Safavi.401

Resolution 1747 of March 2007, also passed unanimously, added to the sanctioned list more entities and individuals connected with WMD programs or the military.402 It banned the export of Iranian arms.403 A third round of UN sanctions was adopted under Resolution 1803 in

March 2008. This expanded the sanctions list and barred travel for certain individuals, and prohibited the sale of practically all dual-use items to Iran.

400 UN Security Council Resolution 1737, December 23, 2006.

401 UN Security Council Resolution 1737.

402 UN Security Council Resolution 1747, March 24, 2007, paragraph 2.

403 UN Security Council Resolution 1747, paragraph 5.

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The final and strongest set of UN sanctions was specified in Resolution 1929 of June

2010. It introduced a new ban on the development of nuclear-capable ballistic missiles; a conventional arms embargo; expanded the sanctioned list to add 15 firms affiliated with the

IRGC; broadened the travel ban to include all individuals mentioned in previous resolutions; banned Iranian investment abroad in nuclear and uranium-related technologies; and in addition to a number of other measures, authorized countries to inspect shipments suspected of carrying contraband items.404

Other Sanctions

The EU imposed its own sanctions following the UN sanctions in December 2006 and

March 2007 – it named 20 more entities whose assets were frozen and placed a more stringent arms embargo and travel ban on Iranian officials.405 In June 2008 the EU also froze the assets of

Iran’s largest bank, Bank Melli and 12 other entities. In July 2010 the EU adopted additional measures beyond those mandated by Resolution 1929.

Following the UN sanctions, other countries have also imposed their own unilateral sanctions on Iran. Australia placed sanctions in October 2008. Although not a member of the

EU, Norway announced it would follow the 2010 EU sanctions.406 Canada, Japan, and South

Korea also followed with similar sanctions.407 The United States has also tried to persuade its

404 UN Security Council Resolution 1929, June 9, 2010.

405 Taylor, Sanctions as Grand Strategy, 75-76; Fitzpatrick, Iranian Nuclear Crisis, 37.

406 Katzman, “Iran Sanctions” (2010), 41.

407 Katzman, “Iran Sanctions” (2010), 42-43.

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allies to limit their financial and economic dealings with Iran. European banks Credit Suisse

First Boston and UBS stopped new business with Iran in 2006.408

(a) Resource Constraints in Pursuit 2006-2010

This section examines the role of sanctions in the resource constraints that sometimes slowed the nuclear program in this period. It concludes that sanctions do not appear to have been influential in this regard.

Technology Denial

It is seen here that sanctions did not significantly deny technology for the nuclear program. Rather, technological difficulties arose principally from external attacks in the form of sabotage through computer worms and assassinations of individuals involved in the program.

Since Iran has not had nuclear cooperation with the United States since the 1970s, there is little to no scope for US sanctions to directly deny such technology. However the United States could potentially disrupt nuclear supplies to Iran by imposing sanctions on other suppliers. UN sanctions since 2006 were specifically aimed at limiting Iran’s ability to pursue nuclear technology. What impact have these secondary US sanctions and UN sanctions had on Iran’s access to nuclear technology?

UN sanctions do not seem to have had a dramatic effect in denying materials since the nuclear program was already well advanced by the time they took effect. For example, Iran had made recent advances in uranium conversion and centrifuge enrichment. IAEA experts held that

408 Helene Cooper and Steven R. Weissman, “West Tries a New Tack to Black Iran’s Nuclear Agenda”, New York Times, January 2, 2007. Persuasion was effective due to American dominance in the financial world – in 2004 the United States fined UBS $100 million for transferring funds to Iran. Taylor, and in 2005 fined the Dutch bank ABN Amro $80 million for not reporting its dealings with Bank Melli. Fitzpatrick, Iranian Nuclear Crisis, 38; Sanctions as Grand Strategy, 70.

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by 2006 Iran already had the components for 5,000 centrifuges.409 In early 2008 Agency inspectors believed that Iran already had most of the materials for developing the more advanced P-2 centrifuge.410 Thus the UN sanctions do not appear to have had a critical effect on the nuclear program apparently because of its fairly advanced stage, and partly due to difficulties with implementing them.411

Other factors that may have contributed to technological denial are the poor quality of the used equipment received from Khan; and sabotage attempts more recently including assassinations of scientists and various computer worms like Stuxnet and Flame.412

Financial Constraints

American sanctions have progressively increased after the breakdown of negotiations in

2005-06. These tightened sanctions appear to have had some effect on Iran’s financial capabilities. At the same time, however, loopholes and numerous exemptions to the US sanctions have meant that their effect has not been total or comprehensive. For example, after imposing the first ISA sanctions in 2010,413 the United States exempted several other firms from

409 Allowing for the possibility that they may not all be of good quality, a conservative estimate held that Iran had the components for at least another 1,000 – 2,000 centrifuges. Albright and Hinterstein, “The Clock is Ticking”, 6.

410 ElBaradei, Age of Deception, 274-275.

411 From the beginning, the sanctions have listed particular individuals and entities as being associated with the nuclear or missile programs. Thus sanctions implementation depended heavily on tracking or at least banning these individuals/ organizations from conducting business abroad and from travelling. This was difficult due to problems identifying these actors, to the extent of confusion among the “similarity of many Middle Eastern names”. Steven R. Weisman, “Lack of ID Data Impedes UN Sanctions Against Iran”, New York Times, September 17, 2007. There are also reports of sanctions evasion. Dana H. Allin and Steve Simon, The Sixth Crisis: Iran, Israel, America, and the Rumors of War (New York: Oxford University Press), 121; Kenneth Katzman, “Iran: US Concerns and Policy Responses”, CRS Report for Congress, December 22, 2010, 31.

412 William Yong and Robert F. Worth, “Bombings Hit Atomic Experts in Iran Streets”, New York Times, November 29, 2010; David E. Sanger, “Iran Moves to Shelter Its Nuclear Fuel Program”, New York Times, September 1, 2011; Sanger, “Obama Order Sped Up Wave of Cyberattacks”.

413 The sanctions were placed on Naftiran, a Swiss-based Iranian oil trading company. Katzman, “Iran Sanctions” (2012), 11-12. 453

the sanctions on the grounds that they had promised to end their operations in Iran, a provision allowed under ISA. The exempted firms were based in allied countries -- Total (France), Statoil

(Norway), ENI (Italy), Royal Dutch Shell (Britain and the Netherlands), and Inpex (Japan).414

US threats to sanction companies selling refined petroleum products appear to have had a dissuasive effect.415 As a consequence, the supply of gasoline to Iran reportedly fell from 3.5 million barrels per day to just 900,000 after CISADA was enacted in June 2010.416 Although this had the potential to inflict significant costs, Iran coped by removing gasoline subsidies, thus raising the price and constricting demand. By doing so, the CISADA sanctions appear to have encouraged investment in domestic refining.417

Effects of UN Sanctions

Unlike the US unilateral sanctions, those imposed by the UN since 2006 have been targeted at the entities and resources supporting WMD programs. Despite this narrower focus, the effects of the UN sanctions seem to be echoing in the economy. For example, the freezing of

Iranian bank accounts in places like the UAE has led to a sudden devaluation of the Iranian currency; sanctions affecting the airline industry have led to a move to privatize Iran Air; and various companies have limited or ended their links with Iran -- Daimler, Toyota, and Hyundai

414 Katzman, “Iran Sanctions” (2012), 12-13. Another set of exemptions relate to the 2010 CISADA provisions. Under CISADA the United States is to impose sanctions on any party that constructs pipelines for exporting Iran’s oil or natural gas. In 1997 Turkey and Iran built a pipeline for transporting natural gas from Turkmenistan to Turkey. However in 2001 Turkey began importing natural gas from Iran, and has not yet been sanctioned under CISADA, apparently due to Turkey’s close relations with the United States. Similarly the United States has not sanctioned Armenia, which built a gas pipeline with Iran in 2009. Katzman, “Iran Sanctions” (2012), 8-9.

415 For example several firms stopped gasoline sales in anticipation of CISADA including the major suppliers. Katzman, “Iran Sanctions” (2010), 11-14.

416 Katzman, “Iran Sanctions” (2010), 12.

417 Economist Intelligence Unit, Country Report Iran, September 2011, 13-14.

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stopped selling cars; and Siemens decided to halt its business with Iran in the context of discussions for stricter UN sanctions in 2010.418

Despite such repercussions, sanctions do not appear to have significantly reduced the financial resources available to the Iranian government. These are based primarily on oil revenues, which increased in this period due to the substantial increase in oil prices.419 Although such growth has been dampened by OPEC quota limits as well as slow development of new oilfields,420 the overall positive growth rates suggest that Iran is not forced to cut funds for key projects.421

Figure 7.8 Iran’s Oil Income in the 2000s

418 “Sanctions begin to bite”, Economist, September 10, 2010; Katzman, “Iran Sanctions” (2010), 31.

419 One exception was the year 2008-09, when state revenues declined sharply as oil prices fell and the global recession took hold. Economist Intelligence Unit, Country Report Iran, January 2009, 5. Growth rates picked up soon after under improved oil prices.

420 Iran has attempted to increase foreign investment in new oilfields by offering better terms in recent years. Projects with Chinese companies for two oilfields in Khuzestan faced declining oil production apparently due to a combination of difficulties from sanctions and Chinese inefficiency. Economist Intelligence Unit, Country Report Iran, July 2010, 16-17.

421 Economist Intelligence Unit, Country Report Iran, July 2010, 7-8.

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Source: Plotted based on data from OPEC Annual Statistical Bulletin (Organization of the Petroleoum Exporting Countries, Vienna), various years, http://www.opec.org.

Figure 7.9 Iran’s Growth Rates, 2004-2010

Source: Plotted based on data from Economist Intelligence Unit, Country Profile Iran, 2005, 2008, and Economist Intelligence Unit, Country Report Iran, May 2012.

Both US and UN sanctions have imposed some economic costs, slowing growth, and increasing unemployment and inflation.422 In the final analysis, however, Iran’s economy has fared far better than in previous decades, reaping the benefits of the high oil prices.423 Hence sanctions did not constrain financial resources for the nuclear program in any meaningful way.

(b) Motivational Changes in Pursuit 2006-2010

During this period, sanctions clearly did not bring about a sustained phase of nuclear restraint. This section asks if sanctions had any effect on the motivations for the nuclear program, whether to deepen or lessen such motives. It also assesses whether sanctions

422 “Sanctions begin to bite”, Economist.

423 O’Sullivan, Shrewd Sanctions, 63-64.

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persuaded the regime to enter into negotiations on the nuclear program.424 It is seen that although Iran suspended cooperation in the immediate aftermath of referral to the Security

Council or the imposition of UN sanctions, it also tended to return to the negotiating table, apparently motivated by a desire to avoid further sanctions.

In general, it is seen that the threat or imposition of UN sanctions was followed by an immediate withdrawal of cooperation by Iran in terms of reducing inspections or stalling negotiations. However, there is an overall pattern in which Iran returns to discussions with the

Western powers and indicates some room for cooperation. For example, a few weeks after the first Security Council resolution on the Iran nuclear issue – Resolution 1696 of July 2006, which threatened sanctions – Iranian President Ahmadinejad inaugurated the heavy water reactor at

Arak (in August).425 However in September nuclear negotiator Larijani indicated the possibility of suspending enrichment for two months.426 In another instance, Iran barred IAEA inspectors soon after the first sanctions resolution of December 2006. By March 2007, however, Iran agreed to more intrusive inspections at the commercial plant at Natanz.427 On a third occasion,

Iran declared that it was limiting cooperation with inspections upon the passage of another sanctions round in March 2007; however this was also followed by the positive development of a return to negotiations (since fall 2006) a few weeks later. These instances of Iran’s cooperation on negotiations and/or inspections appear to be driven by a deep concern to avoid or

424 It is impossible to state with any certainty whether Iran approached the negotiations genuinely or merely as window-dressing; it is likely to have been a mixture of the two. Nevertheless, it is important to consider whether sanctions persuaded Iran to negotiate, since this is not insignificant.

425 Although construction of the heavy water reactor was not explicitly barred by the resolution, the Security Council required Iran to abide by the terms of the previous IAEA Board Resolution, which had asked Iran to “reconsider the construction” of the heavy water reactor. IAEA Report, February 4, 2006, 2.

426 Bali, “At the Nuclear Precipice”, 114.

427 IAEA Report, May 23, 2007, 2. 457

limit UN sanctions. The following pages examine possible Iranian motivations through the lenses of security, prestige, and domestic politics.

Security Model

This model highlights the security implications of the threatened and imposed UN sanctions, and the increasing scope of US sanctions at this time. The ending of Restraint 2 seems to have been facilitated by a perception of declining threats after 2005. International relations had been tense both immediately before and after the 2003 Iraq war, and Iran concomitantly perceived heightened security threats. As shown earlier, this sense of increased vulnerability was a critical factor leading to Restraint 2. After 2005, however, the security threats from the United States were perhaps no longer as urgent or pressing as in the context of the Iraq war, partly due to declining American credibility abroad. At the same time, however, talk of a US or Israeli military strike on Iran resurfaced several times during this period.

Sanctions therefore signaled a continuing threat by keeping open the possibility of an American- led military strike; however, among other factors, the limited scope of the UN sanctions likely signaled that the threat was not urgent. The security model shows that although sanctions did not motivate Iranian leaders to undertake restraint, they repeatedly persuaded them to participate in the negotiations.

Since the US rejection of the 2003 Roadmap (in which Iran offered cooperation on a variety of issues including the nuclear program), Iranian leaders were particularly wary that any compromise would be interpreted as a sign of weakness.428 Another factor that decreased the

428 Parsi, Treacherous Alliance, 255; Barbara Slavin, Bitter Friends, Bosom Enemies: Iran, the US, and the Twisted Path to Confrontation (New York: St. Martin’s Press, 2007), 9; Green et al, Understanding Iran, 8.

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likelihood of restraint was the relative decline in threat perceptions since 2005.429 First, the

Iranian leadership may have concluded that the continued American military involvement in

Iraq and Afghanistan prevented it from undertaking a third military venture.430 Second, the Iraq war facilitated what has been called a Shia revival.431 According to Green et al supreme leader

Khamenei believed that a new Middle East was emerging with the rise of Iran, made possible by factors such as the overthrow of Saddam Hussein and the establishment of a Shi’a-majority government in Iraq, and the 2006 Lebanon war.432 The fall of the Taliban in Afghanistan also contributed significantly to this Shia revival.433 Although Iran disliked American presence in its neighborhood, it was also more emboldened by its “newfound sense of strategic confidence” from the removal of hostile Sunni regimes, as well as by the difficulties faced by the United

States in those countries.434 Indeed, by the fall of 2006 Khamenei declared to Iranian officials that the “tactical retreat” on the nuclear issue was over, and that Iran was now moving forward with “strong heart and clear vision”.435

429 Chubin, Iran’s Nuclear Ambitions, 3.

430 Green et al, Understanding Iran, 40-41; ElBaradei, Age of Deception, 241. It may also have perceived that the United States was dissuaded from attacking due to concerns about disrupting oil supply at a time when prices are high. Gawdat Bahgat, “Nuclear Proliferation: The Islamic Republic of Iran”, Iranian Studies, 39 no. 3 (2006).

431 Vali Nasr, The Shia Revival: How Conflicts with Islam will Shape the Future (New York: W. W. Norton, 2006), 179-180; 212.

432 Nasr, Shia Revival, 170; Mark Gasiorowski, “The New Aggressiveness in Iran’s Foreign Policy”, Middle East Policy, 14 no. 2, 126-127; Green et al, Understanding Iran, 8-9. According to ElBaradei, Iran’s perceived victory in the Lebanon war made it unlikely that it would comply with the first UN resolution on its nuclear program -- Resolution 1696, which threatened UN sanctions if Iran did not suspend enrichment. ElBaradei, Age of Deception, 200. (The Resolution was passed in the midst of the war.)

433 Nasr, Shia Revival, 222.

434 Kayhan Barzegar, “Roles at Odds: The Roots of Increased Iran-US Tension in the Post-9/11 Middle East”, Iranian Review of Foreign Affairs, 1 no. 3 (2010), 88, 90; Green et al, Understanding Iran, 40.

435 Farideh Farhi, “Atomic Energy Is Our Assured Right: Nuclear Policy and the Shaping of Iranian Public Opinion”, ed. Judith S. Yaphe, Nuclear Politics in Iran (Washington, D.C.: National Defense University, 2010), 459

This Iranian resurgence, however, did not imply the negation of threats. The United

States appeared to be engaged in a proxy war with Iran in Iraq.436 In addition, there emerged the threat of a surgical strike against its nuclear facilities by Israel or the United States (or both), as well as a covert war of assassinations and cyber attacks. In the spring of 2006 it was reported that the Bush administration was preparing military plans against targets including Natanz, partly as a coercive measure against Iran.437 By early 2007 the US military buildup in the Gulf was reported to be at “an advanced stage”.438 Throughout 2007 the rhetoric of the American military threat remained high.439 Speculations of an Israeli strike also continued in this period.440

Although attacking Iran’s nuclear facilities would not be easily achieved (since there are several facilities in disperse locations), the threat of military strikes continued to be renewed as indicated by oblique references from the United States and Israel.441

Since 2010 there have been reports of covert attacks involving the killing of scientists associated with the nuclear program, as well as the spread of computer worms infiltrating the

Middle East Security Perspective Series. No. 1, 15. Khamenei was referring to the enrichment suspension as “a necessary move” in the past; now, however, the nuclear program was to move forward alone.

436 Seumas Milne, “The fallout from an attack on Iran would be devastating”, Guardian (London), October 4, 2007.

437 It was believed that the United States was considering use of bunker-busting tactical nuclear weapon to reach targets in Iran. Hersh, “Annals of National Security”.

438 The US presence included aircraft carriers, Patriot missiles, and minesweepers to deal with Iranian retaliation. Ewen MacAskill, “Middle East: Target Iran: US able to strike in the spring: Despite denials, Pentagon plans for possible attack on nuclear sites are well advanced”, Guardian (London), February 10, 2007.

439 Bali, “At the Nuclear Precipice”, 117-118.

440 For example in April 2009 Israeli President Shimon Peres reportedly stated that Israel would strike if Iran did not return to negotiations. Ewen MacAskill, “International: US backs down for Iran nuclear talks: Demands to stop uranium enrichment to be dropped: Negotiations more urgent since Israel’s new threats”, Guardian (London), April 15, 2009.

441For example as a backup to the UN sanctions in June 2010, the Obama administration suggested the possibility of covert operations as well as the possibility of an Israel-led strike. David E. Sanger, “Beyond Iran Sanctions That Probably Won’t Work, Plans B, C, D…”, New York Times, June 11, 2010.

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program. Five reported attacks have killed four scientists, most recently as January 2012. The attacks, which have been attributed to Israeli backing, typically entailed a motorcyclist planting a bomb in the victim’s car.442

Apart from these specific concerns, the Islamic Republic has been concerned about

Western attitudes to it since its establishment in 1979.443 Various indications from the Bush administration pointed to America’s continuing interest in regime change, which Iranian leaders believe to be America’s ultimate goal vis-à-vis Iran.444

The imposition of UN sanctions against the backdrop of such ongoing security concerns likely increased threat perceptions for Iran. Iranian leaders may have concluded that a nuclear deterrent was the only way to guarantee regime and national security.445 At the same time, the threat or imposition of sanctions may have motivated Iran to undertake negotiations in the expectation that this would help eliminate or reduce sanctions, and correspondingly dampen security concerns as well.

Prestige Model

This model suggests that the differences of opinion among the P5+1 weakened prestige- related motives for restraint in Iran. The politics behind the UN sanctions446 suggested that Iran

442 Julian Borger, “Analysis: Covert war carries serious risks”, Guardian (London), January 12, 2012.

443 Chubin, Iran’s Nuclear Ambitions, 14.

444 Sadjadpour, “Iran’s Political/Nuclear Ambitions”; Dorraj, “Behind Iran’s Nuclear Pursuit?”. For example in early 2005 then Secretary of State Condoleezza Rice did not rule out regime change as a US goal. Mark Lander and Elaine Sciolino. “United States and Europe Differ Over Strategy on Iran”, New York Times, January 29, 2005. The United States declared its support for opposition groups after the 2009 Iranian presidential elections, with members of Congress like Senator John McCain openly calling for regime change. Sanger, “Beyond Iran Sanctions”.

445 Meghan L. O’Sullivan, “Iran and the Great Sanctions Debate”, Washington Quarterly, 33 no. 4 (2010), 13; Bowman, “The ‘Demand-Side’”, 634.

446 The February 2006 IAEA Board resolution referring Iran to the Security Council demonstrated the split among Board members, with five abstaining and three voting against the resolution (of a total 35). Former Director General 461

would not be entirely isolated for pursuing its nuclear program. This reduced prestige-related incentives for restraint.

The United States had been advocating crippling sanctions, but Russia and China have tended to agree to UN sanctions only after original resolutions are significantly diluted.447 The

E3 also typically placed far greater emphasis on negotiations (which the United States rejected until 2005) and initially shied away from sanctions. Developing nations under the Non-Aligned

Movement (NAM) have tended to support Iran at the UN. Although the NAM countries are not a powerful political force, they do signify to Iran that it is not politically and morally isolated.448

The nuclear negotiations with Iran were initiated and led by the E3 i.e. Britain, Germany, and France. Their active involvement was a critical factor as the United States had no official contact with Iran until June 2006 when it joined the EU in the negotiations.449

For each party, the evolution of negotiations underlined existing suspicions of the other.

From Iran’s point of view it offered extensive cooperation with the IAEA and redressed past wrongs in late 2003 and 2004.450 It viewed the E3’s recurring demand for a permanent stop to

ElBaradei describes this as a “rare event”. ElBaradei, Age of Deception, 193. Hassan Rowhani has expressed his view that although all the P5+1 nations had the same goal of preventing Iran from acquiring fuel cycle capability, the Iran issue was also a venue for them to compete for power among themselves. Rowhani, “Text of Speech”.

447 Russia and China have presumably been motivated by geopolitical and energy considerations and are also concerned about unchecked US power. The concern about American dominance also appears to be driving EU policy toward Iran Fitzpatrick, Iranian Nuclear Crisis, 35; Taylor, Sanctions as Grand Strategy, 83-84; 99.

448 These international differences led to the repeated delays by the IAEA Board in reporting Iran to the Security Council. After Iran resumed uranium conversion in August 2005, the United States and the EU argued strongly for referral and were supported by Canada, Australia, and Japan. However the 115 NAM countries strongly opposed sanctions and on the Board their position was reflected by Russia and China. John Ward Anderson, “Facing Opposition, US and EU Backpedal on Iran Action”, Washington Post, September 23, 2005.

449 The United States conducted its first direct diplomatic contact with Iranian officials (since 1979) in July 2008 in Geneva, after three rounds of UN sanctions had been imposed.

450 Miller, “Proliferation Gamesmanship?”, 565-566.

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enrichment as a tool to constrain it451 especially since the Paris Agreement had explicitly recognized suspension as a voluntary measure. Additionally, the IAEA declaration of Iranian non-compliance was seen as politically driven since Iran’s main failures sprung from reporting lapses rather than any act of commission.452 At the same time, Iran was slow with the negotiations when it felt it had the upper hand. For example, according to ElBaradei in early

2008 Iran did not respond to the American offer of negotiations (if enrichment was suspended for two months) as it was buoyed by the recent National Intelligence Estimate, which had declared that Iran stopped a concerted nuclear weapons effort in 2003.453

Domestic Politics Model

This section assesses whether sanctions induced Iran to undertake nuclear negotiations via domestic politics. Iran’s desire to avoid and minimize the impact of sanctions was at least partly driven by the domestic economic costs of sanctions, which have direct implications for regime legitimacy and survival. Such concerns have at times pushed Iran towards negotiation.454

However, an overall assessment of domestic factors suggests that they were relatively less influential in encouraging negotiations.

This period of nuclear pursuit occurred under the conservative administration of

Ahmadinejad. Despite this continuity, domestic politics in Iran has been volatile in this phase. A

Khamenei appointee, Ahmadinejad was a surprise winner of the 2005 presidential elections.

451 For example, regime leaders interpreted the failures of the Iranian proposals of 2005 as indicative of the European desire to lengthen the period of enrichment suspension so as to make it a virtually permanent affair. Kile, “Nuclear arms control”, 621-622.

452 Miller, “Proliferation Gamesmanship?”, 568.

453 ElBaradei, Age of Deception, 270.

454 Economist Intelligence Unit, Country Report Iran, September 2011, 6.

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Unsurprisingly, Iran entered a phase of nuclear pursuit under the new conservative leadership.

At the same time it also entered into negotiations, led by the pragmatic-conservative Ali

Larijani. National power politics clearly affected nuclear negotiations when Larijani was fired in fall 2007.455 His replacement, Saeed Jalili, was a staunch conservative opposed to compromise in the negotiations. Moreover, Ahmadinejad’s fiery rhetoric soon distanced him from the supreme leader, who used to be the hardliner in national decision-making.456 Ahmadinejad’s extremist position actually put him in a stronger position to make concessions, much like Nixon was able to normalize relations with China.457 Indeed in 2006 and 2007 Ahmadinejad appeared willing to make concessions on enrichment. However domestic opposition forces both on the right and the left disagreed, principally because they did not want him to score an important political victory.458 Thus negotiations in 2007-09 were especially hostage to the domestic political currents in Iran.

Since supreme leader Khamenei is the ultimate leader and decision-maker on the nuclear program, the viewpoint on foreign policy tends to an overall conservative, anti-Western position. The default i.e. politically pragmatic position on foreign policy is to oppose collaboration with the West and avoid giving concessions. Nuclear negotiations in this phase

455 This may have been because he remained a political rival to Ahmadinejad – he had contested the 2005 presidential elections (Fathi and Slackman 2007; Posch 2007). The immediate trigger was differences between Larijani and Ahmadinejad on how to proceed with the nuclear negotiations, with the former supporting compromise in the form of the “freeze for freeze” proposal, while Ahmadinejad opposed enrichment suspension. “Iran’s nuclear negotiator resigns”, BBC, October 20, 2007, accessed April 4, 2011, http://news.bbc.co.uk/2/hi/7053963.stm.

456 Naji, Ahmadinejad, 125.

457 Kayhan Barzegar, “The Paradox of Iran’s Nuclear Consensus”, World Policy Journal, 26 no. 3 (2009), 22. Ahmadinejad’s willingness to compromise was most clearly displayed in his tilt toward the TRR fuel deal in the fall of 2009.

458 ElBaradei, Age of Deception, 198-199.

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have in fact tended to this center of gravity. When leaders did seek to compromise on the negotiations, they were motivated by external threats rather than by domestic politics.

Public opinion was not a major factor affecting decision-making on the nuclear program until around 2005, when the election of President Ahmadinejad and the ongoing international spotlight on Iran led to a politicization of the issue.459 Today public opinion strongly supports the nuclear program, which is considered a powerful prestige symbol.460 In any case, after the

Iran nuclear file was referred to the Security Council in February 2006, it became politically costly to offer any concessions on enrichment suspension.461 This makes it difficult to undertake restraint.

Conclusion

This chapter has shown that sanctions were not the main factor behind the denial of technology to the Iranian nuclear program in the 1980s and 1990s; in the 2000s, however, they played a critical role in persuading nuclear restraint. This is significant since it remains the only instance of motivation-driven restraint in Iran’s nuclear program. Nevertheless, in the final analysis it is seen that sanctions failed to either stop or rollback the program.

The most-far reaching type of restraint in Iran’s nuclear program till today has been its stopping in the years immediately following the 1979 revolution. As shown here, this was due to the change in supply as well as motivational factors surrounding the establishment of the new

Islamic regime. Since then, the program has not stopped or rolled back, despite numerous

459 Barzegar, “Pardox of Iran’s Nuclear Consensus”, 24.

460 Barzegar, “Paradox of Iran’s Nuclear Consensus”; Mukhatzhanova, “Pride and Prejudice”, 61.

461 Farhi, “Atomic Energy Is Our Assured Right”, 5.

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setbacks. The desire for nuclear weapons capability, which was born during the war with Iraq, appears to have continued unabated till today.

In light of this, restraint during 2003-05 was especially significant, as Iran chose to suspend key activities in the fuel cycle. As argued in this chapter, this brief period of nuclear restraint was the result of a unique set of international circumstances, where the first nonproliferation war raised fears of other such military attacks, backed by the possibility of avoiding attack in exchange for restraint. The analysis has shown the paramount role of the threat of UN sanctions in this period of restraint, which was credible and potent, and yet remained less costly than military strikes.

The study has shown that the numerous instances of US efforts to deny nuclear technology were successful in at least delaying Iran’s nuclear program. However, together with major regional events such as the 1991 and 2003 Iraq wars, US policy appears to have deepened

Iran’s motivations for nuclear technology by solidifying the United States as its number one threat. Ultimately, the deep trust deficit between the two countries – which has arisen from legitimate factors for both sides – appears to ensure both that the United States will persist in its sanctions and military sticks, and that Iran will incrementally move closer to a nuclear weapons capability.

Table 7.6 Final summary of Iran’s nuclear restraint

Did Sanctions impose significant Did Sanction induce Restraint Resource Constraints on Motivational Changes NW program? in NW program? Restraint 1: Stop No No (1979-1983)

Restraint 2: No Yes Slow (2003-2005)

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CHAPTER 8

CONCLUSION

The dissertation has sought to understand the role of economic sanctions in nuclear restraint. Offering a categorization of restraint as Slow, Stop, and Rollback, the research hinges on the puzzle of why some nuclear weapons programs have ended or rolled back, and the role of sanctions in this result. The analysis has shown that sanctions were sometimes very influential in nuclear restraint, but only in combination with other factors. In other words, sanctions are not a sufficient condition for rollback, but in certain cases they are a necessary one. This concluding chapter lays out the overall conclusions and main contributions of the dissertation. It first discusses the central arguments and conclusions, which is then followed by the contributions of the research.

Conclusions

Having examined the nuclear programs in four countries, this research concludes that sanctions have sometimes been highly influential in ending nuclear programs. Whereas the nuclear weapons effort in Iraq, Taiwan, and Libya ended and weapons-related facilities were dismantled, Iran has continued its projects for fissile material production. In other words, rollback occurred in Iraq, Taiwan, and Libya but not in Iran. Of these instances, sanctions were highly influential in the nuclear decisions of Taiwan and Libya. Despite this overall status of the nuclear effort, all four countries have displayed varying levels of nuclear pursuit and restraint, thus offering opportunities for comparative analysis within each case. In summary, I argue that Iraq’s nuclear program ended under the combined effect of the 1991 Gulf

War and rigorous UN inspections; sanctions helped prevent the rebuilding of the program, largely through resource denial. Taiwan’s nuclear weapons effort ended due to American pressure in the form of threatened US sanctions. Libya’s nuclear rollback is explained by 467

external and internal threats to the regime; sanctions aggravated both these threats. And finally,

Iran’s nuclear program has slowed down briefly under the threat of UN sanctions; however, its program has neither stopped nor rolled back since 1984. Overall, sanctions have done little to constraint Iran’s nuclear program and, in fact, have strengthened the motivations for it.

Table 8.1 Summary of rollback in Iraq, Taiwan, and Libya

Country What explains rollback What was sanctions impact

Iraq 1991 Gulf War and Inspections Prevented rebuilding the program

Taiwan Threat of losing US support Threat of sanctions was critical in conveying threat of losing US support

Libya External military threats and US sanctions conveyed military threats; US and domestic challenges UN sanctions exacerbated domestic challenges

This research began with the assumption that sanctions can curb nuclear programs either physically by denying appropriate resources or by convincing countries that restraint is better for their interests. The question is whether sanctions do either. These two processes, referred to here as resource denial and motivational changes respectively, reflect the distinction between the technological and motivational factors leading to nuclear proliferation. This distinction is based on a country’s ability to pursue nuclear weapons, versus its intention to do so. To put it simply, in resource denial, restraint is unintentional; in motivational changes, it is intentional.

Although not stated as such in the proliferation literature, this differentiation between capability and motivation derives much from Thomas Schelling’s classic work on brute force versus coercion. Drawing on his work, I argue that nuclear restraint is brought about by resource denial when a country does not choose restraint, but rather, restraint is forced upon it. This could be due to military or sabotage attacks, or due to limitations of financial and technical resources. I also argue that nuclear restraint is brought about by motivational factors when leaders calculate

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that they will gain more from restraint than nuclear pursuit. Based on the proliferation literature, motivations are classified as security, domestic politics, or prestige.

Whereas the technological thesis has been largely debunked in regards to explaining proliferation, my work shows it to have far more significance for nuclear restraint – technological capability alone is insufficient to explain why a state has a nuclear weapons program; however, the lack of technical and other resources is sufficient to explain nuclear restraint in certain cases.

The limited number of countries studied here precludes making widely general conclusions. However, some specific observations can be made. The following table lists the instances of restraint according to the three-fold classification of Slow, Stop, and Rollback.

Their associated processes are listed i.e. whether restraint was predominantly brought about by resource constraints or motivational changes, or both. Finally, the table also lists the main sanctions contribution to restraint, if such existed.

Table 8.2 Final summary of the impact of sanctions on nuclear restraint

Restraint # Details Main process Was the main process chiefly (dependent brought about by sanctions var) (independent var)? Slow 1 Iraq 1979-1981 Resource denial No

2 Iraq March-April Resource denial & Partly yes, motivational: 1991 Motivational changes Security Domestic Politics

3 Taiwan 1973 Motivational changes Yes Security Domestic Politics

4 Libya mid-1980s- Resource denial No 1995

5 Libya 2002 Motivational changes Yes Security Domestic Politics

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6 Iran 2003-2005 Motivational changes Yes Domestic Politics

Stop 1 Iraq April 1991 Motivational Yes Security Domestic Politics

2 Taiwan 1977- Motivational Yes 1978 Security Domestic Politics

3 Iran 1979-1983 Resource denial & No Motivational changes

Rollback 1 Iraq Jan-Feb 1991 Resource denial No

2 Iraq May 1991- Resource denial Limited yes 1998 Technological Financial

3 Taiwan 1977- Motivational changes Yes 1978 Security Domestic Politics

4 Taiwan 1988 Motivational changes Yes Security Domestic Politics

5 Libya 2002-2009 Motivational changes Yes Security Domestic Politics

In the final analysis, I have examined 14 instances of restraint and 9 instances of pursuit.

The role of sanctions was not insignificant in ten of these 14 instances of restraint. Of the five cases of rollback, sanctions played a significant role in three cases. Although their impact was at times magnified by other factors, sanctions were a major cause of nuclear rollback in these three instances. In one of the cases of Rollback (Iraq Jan-Feb 1991), sanctions played no role at all. In several cases of pursuit, I find that sanctions were either absent or applied half-heartedly i.e. were combined with other major economic/military transactions, or included numerous

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exceptions or loopholes. In many cases, the sanctions were unilateral, being led by the United

States.

In cases where sanctions mattered, these cases show that the motivational route has tended to be more effective for the working of sanctions. This supports the existing literature, which tends to assume that sanctions are influential as coercive instruments rather than in denying the ability for nuclear pursuit. The cases also show that where resource constraints were significant, sanctions were generally not the predominant cause of such constraints largely because they were unilateral. Such instances include Iraq 1979-1981, Libya mid 1980s-1995, and Iran 1979-1983. Therefore, in the cases studied here, sanctions typically did not significantly inflict nuclear restraint by resource denial. However, as the detailed narration has shown, this is not to say that sanctions had no effect via resource denial. It is evident from the table that, in the cases examined, sanctions never slowed or stopped a nuclear weapons program through resource constraints. When sanctions did contribute to the slowing or stopping of a program, it was always by affecting motivations. Only on two occasions did sanctions play a significant role in restraint – Iraq’s rollback in 1991-19918, and Iraq’s continued restraint in

1998-2003. In both cases, sanctions were not the original cause of restraint, but served to maintain restraint that was brought about by other factors.

Thus sanctions-induced resource constraints have generally not been a significant cause of restraint or rollback. However, other resource factors have been important. For example, resource-driven restraint in Iraq in 1979-1981 as well as in 1990s was caused by sabotage, military strikes, and inspections; resource-driven restraint in Libya in the late 1980s and early

1990s was largely due to the reluctance of Western suppliers to sell nuclear technology to

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Qaddafi’s regime; and the resource factors contributing to restraint in Iran 1979-1983 sprung from the emergence of the Islamic Republic.

My analysis shows that sanctions have tended to be most influential through the motivational route. In such sanctions-induced motivational restraint, sanctions helped to clearly communicate the advantages of restraint, as well as the concomitant disadvantages of continuing pursuit. In Iraq, Resolution 687 helped convince Saddam Hussein on the need to stop the nuclear program by pegging sanctions to WMD disarmament, and introducing inspections. In all three instances of restraint in Taiwan, sanctions helped convince the leadership of the seriousness of the US position, showing the futility of pursuit – i.e. pursuit was driven by concerns about security, which would be worsened if the United States abandoned Taiwan. In

Libya, sanctions served to convey the serious danger of a US-led military attack. Qaddafi had perceived sanctions in this way since the 1991 Gulf War, but this view gained particular urgency after 9/11 and the 2003 Iraq war. At the same time, he expected that the risk of attack would be eliminated if he disarmed. And finally, in Iran the threat of UN sanctions conveyed the unified international position against Iran. In the context of the Iraq war, this seriously raised the prospects of military strikes. Hence Iran undertook restraint.

Motivational restraint happened when the target’s views of its future preferences were seriously called into question, accompanied by some expectation that restraint would bring some benefits. Ultimately, the success of such coercion seems to have hinged on whether the main sender i.e. the United States was able to offer something that the target valued. In Taiwan, the

United States assured that nuclear, economic, and political cooperation would continue if

Taiwan undertook restraint; similarly, Libyan leader Qaddafi was assured that WMD disarmament would be a major step paving the way for normalization of relations; and Iran was

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assured that sanctions would be avoided if it voluntarily undertook restraint. In Iraq, limited motivational restraint occurred with the passage of Resolution 687, which pegged the lifting of sanctions to WMD disarmament. This convinced Saddam Hussein to abandon the nuclear program.

Interestingly, the instances of threatened sanctions studied in the dissertation – in Taiwan and Iran – point to the coercive success of threats. In these two countries, the clear and credible threat of sanctions as a response to continued nuclearization played a major role in motivating restraint. This observation underlies the prevalent belief in the literature that coercion is often more successful with threatened punishment.

As stated earlier, motivational rollback occurred only in Taiwan and Libya. Clearly, sanctions were not the main explanation for such motivational nuclear rollback. In each of the instances analyzed, some more influential process was at work. Yet sanctions played a crucial role at least in some cases of rollback. In Taiwan, the threatened US sanctions conveyed the seriousness of the US position. Sanctions played a critical role in communicating (a) that the

United States was serious about not tolerating reprocessing capability in Taiwan, and (b) it would not cost the United States much to cut off links with Taiwan, something that it was anyway partly undertaking as a result of normalization with the PRC. Since Taiwan had a close relationship with America, it was easier for its leadership to believe that (a) sanctions would not be imposed if it complied, and (b) other additional demands would not be made.

Similarly, in Libya, sanctions derived their potency from the fact that Qaddafi viewed them as indicating his international isolation, which increased the chances of a US-led military attack. Sanctions played a special role in that they conveyed the possibility of a US attack in the context of 9/11 and the Iraq war. This threat was real enough for Qaddafi, who attempted to

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placate the United States through such measures as offering intelligence, moving to situate

Libya as a US supporter in the war on terrorism. Clearly the main factors affecting Qaddafi were the threat perceptions emanating from the Iraq war. However sanctions played the crucial role of signifying this US threat, acting as a symbol of military threat. Sanctions also lent themselves to be used as a bait i.e. their ending was a tangible short-term goal for Qaddafi, as well as something that the United States could promise to work on lifting. Thus the vague goal of

“normalization”, which is in essence reducing the threat of military attack, could be concretized in terms of lifting US sanctions. Again, as in Taiwan, sanctions served this delicate position of being a credible and potent threat, combined with a credible or hopeful expectation that rollback would be reciprocated with the removal of sanctions (or their threat), and therefore of the larger threats associated with sanctions.

No doubt, these larger threats are the factors that actually drove rollback, giving bite to the sanctions. Yet my case studies have shown that sanctions served as more than a mere signal of military threats. They played the delicate role of conveying the right amount of pressure – too little, and the target would have little incentive to comply; too much, and the target could dig in its heels if it concluded that nuclearization is the best way to safeguard its interests. Although the ultimate pressure force for sanctions were military factors, sanctions were themselves a crucial, tangible threat or punishment that could be alleviated with restraint. Motivational rollback was achieved due to the target’s expectation that the threat held in reserve i.e. military threats could be avoided. In the case of Taiwan, this ultimate threat was the danger of losing its special economic and political relationship with the United States; in the case of Libya, it was the possibility of a US-led military strike.

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In examining resource denial and motivational changes, the dissertation pays careful attention to both the supply-side and the demand-side of proliferation. In doing so, it follows the more recent proliferation literature highlighting the importance of technological availability

(Kroenig 2010; Fuhrmann 2009). This research has highlighted the complex relationship between the ability and intention to proliferate. Although analytically distinct concepts, they are often deeply interconnected – a state’s desire for nuclear weapons is affected by how easy or difficult it would be to acquire them. The case studies show the absence of a direct relationship between resource denial and motivational changes. Although at first glance it would seem that the two effects are positively related -- the more the resource denial, the greater the motivational change -- this is not always true. The case where sanctions-induced resource denial had the maximum effect on the nuclear program was 1990s Iraq. However the sanctions did not convince Saddam Hussein to rollback the nuclear program.

Conversely, Taiwan and Libya demonstrate that resource denial can encourage motivational change. In Taiwan, the resource denial effect of sanctions did not actually take place as sanctions were only threatened. However the potential impact of resource denial was very high if sanctions were implemented. This helped convince the ROC leadership that it would be physically difficult to make significant advances in the nuclear program in the face of staunch American opposition. Similarly, the Libyan nuclear program depended heavily on external assistance and this made it easier to convince Qaddafi that progress on the nuclear program would be difficult so long as the United States opposed it. Failure to obtain the technology abroad was one of the factors persuading Qaddafi to undertake rollback in 2003. Yet resource difficulties can conceivably deepen a state’s motivation for nuclear weapons by signifying hostilities from other countries, which avoided selling nuclear technology. This

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dynamic may have strengthened Iran’s motivations for a nuclear weapons program, since the

United States actively pressured other countries from selling nuclear-related technology. The relationship between resource constraints and motivational changes is therefore quite complex.

It would be simplistic to explain motivational rollback in terms of difficulties obtaining resources, as this begs the question as to when leaders decide they simply need to try harder.

The Mechanisms by which Sanctions Work

The central argument of the dissertation is the following: Nuclear restraint is achieved by either denying resources or changing motivations, and sanctions can have a role in both. The argument generates two implications: (1) It is seen that resource denial can occur only when sanctions are imposed, not merely threatened. (2) Sanctions-induced resource denial can slow or stop a nuclear weapons program, but it cannot roll it back; sanctions-induced motivational changes can slow, stop, or roll back a nuclear weapons program.

The sanctions literature typically focuses on the coercive impact of sanctions, which is often assumed to be directly proportionate to the costs inflicted by sanctions. One important exception is Crawford and Klotz, who list “resource denial” as one of four possible mechanisms by which sanctions may work to change a target country’s policies.462 The dissertation emphasizes this distinction between the resource denial impact of sanctions and the coercive or persuasive role, where sanctions alter leaders’ cost-benefit calculus in favor of nuclear restraint.

(a) Resource Denial

Under this process, sanctions physically block the pursuit of nuclear weapons by denying the required technology or finances. It can occur only when sanctions are implemented on the ground. Resource Denial consists of two possible components (i) sanctions block specific

462 Crawford and Klotz, How Sanctions Work.

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materials and technology required for the nuclear program, and/or (ii) sanctions limit the financial resources available for the program. Under resource denial, sanctions cannot roll back a nuclear weapons program since at maximum sanctions can only block further spending or technical resources in the nuclear effort.463 The main arguments regarding the two types of resource constraints are discussed below.

In the cases examined, resource constraints have not been a significant cause of nuclear restraint. Often, this was due to the unilateral character of sanctions. Where sanctions were multilateral, other factors tended to exert far greater resource constraints. For example, Libya’s resource constraints arose from overall economic problems and Western hesitance in supplying nuclear technology to Libya; in Iraq, the effects of military force and inspections on the nuclear program were far more direct. In any case, I have pointed out that sanctions-induced resource constraints cannot achieve nuclear rollback. The case studies have shown that sanctions-induced resource constraints have at best maintained rollback, which was achieved by other factors.

(i) Technological Constraints

For sanctions to bring about nuclear restraint through technological denial, it is necessary that they block the country’s access to required materials and technology. This implies the following requirements. First, sanctions must be effectively implemented with few occasions of evasion, or the state may be able to acquire the prohibited materials illegally. Second, the sanctions must necessarily be multilateral or nearly universal since availability of the banned materials from a country that is not participating in the sanctions will facilitate nuclear pursuit.

For example, Iraq was able to obtain enrichment technologies in the 1980s from European

463 However, other forms of resource denial – most notably, military attacks – can roll back a nuclear program. This is most clearly seen in the case of Iraq after the 1991 war.

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sources despite US unilateral sanctions. The UN sanctions on Libya in the 1990s made it difficult to obtain nuclear technology in the open market.

A state whose nuclear program is curbed by the lack of access to technology from legitimate sources will naturally turn to other venues if such exist. Of the cases examined here,

Libya and Iran tapped into the nuclear black market led by A Q Khan, and Iraq developed its own clandestine contacts with German and other sources in the 1980s. In fact, Iranian officials have stated that they were forced to contact the network after making futile attempts to obtain

Western assistance. Thus the success of sanctions-induced technology denial depends on the creative resourcefulness of the target state. In the cases examined here, sanctions denied important nuclear technology to Iraq in the 1990s, inflicting resource denial on the program.

This was possible as the sanctions were multilateral and comprehensive. The UN sanctions on

Libya in the 1990s also placed some technology constraints on Libya’s nuclear program.

However, such effects of the sanctions began to wear off as they gradually lost international support in the late 1990s, and Libya approached the Khan network as an alternative supplier of nuclear technology.

In Taiwan and Iran, sanctions did not inflict major technological constraints on the nuclear weapons program as they were unilateral. Taiwan’s attempts to obtain nuclear technology from European sources, as well as Iran’s overtures to Europe, China, and Russia largely failed due to American pressure on the suppliers rather than due to sanctions. Therefore, in the cases examined here, sanctions were not significant in denying nuclear-related technology to targeted countries. Overall, this is due to the largely unilateral nature of sanctions imposed on these countries. Since it is famously known that international cooperation on sanctions is

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difficult to accomplish, this suggests that the potential for sanctions to inflict technological denial is likely to be limited.464

(ii) Financial Constraints

For sanctions to exert financial constraints on the nuclear program, they must inflict overall economic costs on the target country. This automatically has the following implications.

First, as with technology denial, sanctions must be imposed and not merely threatened i.e. they must be implemented on the ground, as there can be no economic costs without such enforcement. This also implies that there must be relatively few evasions of the sanctions.

Second, the sanctions must be either multilateral or imposed by a country with which the target has extensive economic relations.

As the case studies have shown, financial limitations rarely acted as a major constraint on the nuclear weapons program. Only on two occasions did financial limitations significantly affect the nuclear program – Iraq 1991-1998, and Iraq 1998-2003. On both occasions, however, they were not the principal cause of restraint or continued restraint respectively. During 1991-

1998, financial constraints helped maintain Iraq’s nuclear rollback, which was itself achieved by military action and inspections. After 1998, financial constraints were no longer as severe as sanctions were eased in that period. The predominant reasons for continued restraint at that time were the dysfunctional nature of the Iraqi regime, coupled with the overwhelming task of rebuilding a program that had been entirely eliminated. It is therefore interesting to note that the devastating economic consequences of the sanctions on Iraq were not, in fact, a significant cause of Iraq’s nuclear restraint. Iraq in the 1990s remains an unparalleled case of total, universal sanctions that exerted a tremendous toll on the economy. Such financial constraints

464 Hufbauer et al, Economic Sanctions Reconsidered; Martin, Coercive Cooperation.

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prevented the rebuilding of the nuclear program. However, it is highly unlikely that financial constraints alone, in the absence of military attacks and inspections, would have stopped the nuclear program.

The US economic sanctions on Taiwan did not significantly limit that country’s physical capacity to pursue the nuclear program, as they were largely threatened. If the trade relationship between the two countries had actually been suspended, this would have greatly constricted

Taiwan’s financial ability to purse the nuclear program. Similarly, the threat of UN sanctions on

Iran in 2003-2005 did not deny financial resources for the nuclear program. Finally, since sanctions-induced financial problems cannot explain nuclear rollback, the dismantling of the

Libyan nuclear program cannot be attributed to resource denial by sanctions.

In the countries studied here, in no instance was sanctions-induced economic constraints the primary cause of restraint. At best, such financial constraints helped prevent the rebuilding of the dismantled program in Iraq.

(b) Motivational Changes

Sanctions generate motivational changes favoring nuclear restraint when they make it more costly for a country to continue its nuclear program, so that leaders are persuaded that restraint is more beneficial than pursuit. Unlike in the case of resource denial, both threatened and imposed sanctions have the potential to inflict such costs. In fact, threatened sanctions tend to wield greater power because they can be held in reserve as a continuing threat, and because sanctions tend to lose their flexibility once they are imposed.465 This coercive power of threatened sanctions is illustrated in the cases of Taiwan and Iran (2003-05).

465 In coercion, the best tools are those that are easily flexible so that they can be adjusted according to target behavior. However sanctions – due to the domestic political factors in the sender – tend to acquire a life of their own and it is usually difficult to decrease them if the target has not overtly complied. This makes it very difficult to remove sanctions that have already been imposed. In fact, among the cases studied here, Libya post-2003 is the only 480

For sanctions to increase the relative costs of the nuclear program, it is not necessary that they be multilateral. In fact as the literature points out, multilateral sanctions can complicate coercion through disunity among senders.466 The case of Taiwan’s nuclear rollback shows how unilateral sanctions motivated restraint by virtue of Taiwan’s extreme dependence on the United

States. Here, the coercive impact of sanctions arose partly due to the potential for tremendous resource constraints.

Of the four countries examined here, restraint due to motivational changes has occurred on the following occasions – Iraq (March-April 1991), Taiwan (1973), Taiwan (1977-78),

Taiwan (1988), Libya (2002-2009), and Iran (2003-2005). In all these cases, sanctions appear to have been a critical factor persuading leaders to undertake nuclear restraint. Motivations were specifically affected through the security and domestic politics models, while prestige considerations were not seen to be critical. This means that, where they were successful, sanctions affected the security and domestic political pressures favoring restraint.

The security factor has clearly been crucial in motivational restraint. It worked by making the state increasingly insecure with continued nuclear pursuit. In other words, the insecurities generated by the nuclear weapons program were seen to outweigh the security benefits. Hence, as argued in the proliferation literature, security factors necessitated nuclear restraint. Sanctions played a role in this by affecting such security considerations. In the cases examined, the predominant role of sanctions was in clearly conveying such security threats. In

Iraq, the cease-fire arrangement following the 1991 war established a draconian inspections regime and sanctions for the purpose of disarming Iraq. In Taiwan, sanctions derived their bite instance where sanctions were suspended and/or lifted in reciprocity for the target’s actions. This was possible because Libya risked loss of face by making an overt compromise.

466 George, Forceful Persuasion, 70; Hufbauer et al, Economic Sanctions Reconsidered.

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from the threat of losing the security alliance with the United States. In Libya and Iran, sanctions conveyed the threat of US military strikes due to the backdrop of the Iraq war.

The case studies have also shown that typically, motivational restraint involved some calculation of the domestic political imperatives. Saddam Hussein was motivated to end the nuclear program in April 1991 partly in response to the widespread eruption of domestic rebellion; Taiwan’s Chiang Ching-kuo was increasingly under pressure to sustain the economic miracle as a way of justifying authoritarian rule; and Libya’s Qaddafi also hoped to reap economic benefits in order to buy domestic political support.

As the dissertation has shown, domestic factors have always affected nuclear decision- making, which is taken in the domestic context. Where sanctions have persuaded restraint, domestic pressures for survival have typically been important, where the removal of sanctions was expected to bring some domestic support. In Iran, domestic politics has typically meant increased nuclear pursuit rather than restraint, since the latter is seen as giving concessions to the West. Ultimately -- as Schelling notes -- compellence greatly depends on the internal workings of a government and its bureaucracy.467 Influencing a particular actor may or may not translate into coercive success depending on the composition of the government in terms of the bargaining power of different groups.

Finally, the cases suggest that prestige considerations were not an overarching factor bringing about restraint. While the benefits of abiding by the international nonproliferation norm sometimes helped the decision on restraint, such considerations were generally minor in the overall decision-making. In Sagan’s three models of motives explaining pursuit and restraint, prestige is not shown to be an overarching explanation. In the one instance that Sagan cites as an

467 Schelling, Arms and Influence, new ed. (2008), 85-86.

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example of prestige-driven restraint – Ukraine -- the main causal explanation is assigned to the role of economic coercion, and the NPT norm helped justify such coercion. This dissertation supports such arguments, whereby prestige consideration played a secondary role in persuading restraint.

Coercion is at its heart an exercise in cost-benefit analysis for the target state. The balance in favor of restraint is naturally made difficult if the costs are perceived as high. When does coercion succeed? This has been the subject of coercive diplomacy, developed on the work of Thomas Schelling and Alexander George. Their work has highlighted the role of several factors that affect coercion. For example, whether sanctions succeed in persuading restraint depends on how deeply the target desires to continue its nuclear weapons program.468 If the program is seen as vital for national or regime survival, then the costs from sanctions would also have to be prohibitive in order to induce a change in motivations. In the case of Iraq, the regime perceived the nuclear program as vital. Hence high costs from sanctions, inspections, and military force brought about limited motivational restraint. Similarly, the Iranian nuclear program now holds great value for both the population and the leadership, making it difficult to persuade restraint. For the Libyan regime, the nuclear program was less an end by itself and more a means to bolster internal and external security. A rise in external and internal threats therefore persuaded it to undertake restraint. Finally, Taiwan’s interest in nuclear weapons was driven by deep security considerations; nevertheless since the United States was itself the cause of these fears, it was able to influence the leadership’s cost-benefit calculus on the nuclear program.

468 Schelling, Arms and Influence, new ed. (2008), 89; Gary Schaub Jr., “Compellence: Resuscitating the Concept”, ed., Freedman, Strategic Coercion, 46.

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The dissertation has highlighted the role of economic factors in decision-making on the nuclear program. Such economic considerations often have important domestic political implications, and can therefore act as a powerful force persuading restraint.

Motivational changes are favored when the sender communicates that (a) the sanctions will end upon target compliance, and (b) other demands will not be made of the target.469

Appropriate assurances (i.e. credible and clearly communicated) are an essential component of coercion.470 Such assurances are far easier to convey when the sender has friendly relations with the target. Countries with which the sender has hostile relations, however, are likely to view these assurances with suspicion. This has been repeatedly seen in the case studies – it was not difficult for the United States to convince the Taiwanese leadership that sanctions would not be implemented if Taiwan ended its reprocessing efforts; this was particularly helped by the fact that the sanctions had only been threatened at that point, making it far easier to lift them compared to implemented sanctions. Secondly, the ROC regime could reasonably expect that the United States -- its long-standing ally -- was not going to make additional demands. In the cases of Iraq, Libya, and Iran, however, the nature of the past relationships with the United

States greatly colored their perceptions of American assurances.

The cases of Iran and Libya display limited periods where these regimes perceived US- backed assurances as credible. The initial crisis regarding Iran erupting in 2002 was limited to the issue of the nuclear program rather than past American concerns on human rights, support for terrorism, and the nature of the Islamic Republic. In addition, the Iranian regime could reasonably expect that compliance would lead to the removal of the threat of UN sanctions as

469 Schelling, Arms and Influence, new ed. (2008), 74, 88.

470 Schelling, Arms and Influence, new ed. (2008), 74-75.

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this was built into the agreements that Iran entered into.471 However, the breakdown in understanding between Iran and the West on what constituted enrichment suspension led to

Iranian suspicions that demands were shifting. Needless to say, the ongoing issue for Iran is the precise nature of what is being demanded.472

Despite the hostile relationship between Libya and the United States, coercion in the

1990s was greatly facilitated by the finite nature of the demand – the Security Council demanded that Libya handover the two suspects in the Lockerbie case for trial. This was a clearly defined goal with the potential to minimize prestige losses for the regime. More critically, however, the Council stated that the sanctions would be removed if Libya cooperated.473

The sanctions critic Robert Pape has argued that the so-called cases of sanctions success actually display the power of the military factor, which often acts as the real force behind sanctions.474 Some of the observations in this dissertation on the role of sanctions in signaling military resolve might seem to support this view. While it is true that sanctions acted to convey military threats, this does not necessarily minimize their role. In fact, sanctions served a convenient role in signaling the military threat without resorting to military elements

471 For example, in the Tehran Agreed Statement the foreign ministers of Britain, France, and Germany stated that “In their view full implementation of Iran’s decisions, confirmed by the IAEA’s Director General, should enable the immediate situation to be resolve by the IAEA Board” and that “The three governments believe that this will open the way to a dialogue on a basis for longer term co-operation which will provide all parties with satisfactory assurances relating to Iran’s nuclear power generation programme” (Tehran Agreed Statement, paragraph 3).

472 Seyyed Hossein Mousavian (former head of the Foreign Relations Committee, Iran’s Supreme National Security Council), phone interview by author, May 26, 2011.

473 UN Security Council Resolution 748, March 31, 1992, http://daccess-dds- ny.un.org/doc/RESOLUTION/GEN/NR0/011/07/IMG/NR001107.pdf?OpenElement ; UN Security Council Resolution 883, November 11, 1993, http://daccess-dds- ny.un.org/doc/UNDOC/GEN/N93/626/78/PDF/N9362678.pdf?OpenElement.

474 Pape, “Why Economic Sanctions Do Not Work”.

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themselves. In this way -- at least in the cases of Libya (2002-2009) and Iran (2003-2005)-- they were able to achieve the delicate balance of communicating the right level of military threat.

This is important since, as discussed below, military threats have not always encouraged nuclear restraint. Moreover, the case studies show that the sanctions have had broader effects than merely symbolizing military threats.

This is especially gleaned from the observation that military threats have often aggravated nuclear pursuit, rather than encouraged nuclear restraint. Instances where military threats undermined the motivations for restraint include 1990s Libya, 1990s Iraq, and post-2005 Iran.

The strong perception of military threats may lead a regime to conclude that compliance would be futile. Leaders may perceive that senders have additional motives and that undertaking nuclear restraint may not bring relief from sanctions or other coercive attempts. This situation occurred in late 1990s Iraq and post-2005 Iran, where the leadership became convinced that compliance would be interpreted as a sign of weakness, giving the senders further opportunities for coercion in other areas. A similar concern affected Qaddafi throughout the 1990s, making it difficult to settle the Lockerbie issue. This notion that compliance will be interpreted as an invitation for further coercive pressure is an ongoing theme dominating the thinking in the regimes that have hostile relationships with the senders.475 It shows that security considerations alone have often been insufficient in motivating restraint. As the case studies have shown, sanctions played a significant role in communicating the right amount of pressure, a feat that is usually difficult to achieve. This was demonstrated in Taiwan, Libya (2002-2009), and Iran

(2003-2005).

475 Drezner, Sanctions Paradox.

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Summary Conclusions

This dissertation finds that many of the factors discussed in the literature as affecting the working of sanctions do indeed play important roles. However, this analysis concludes that we cannot generalize the direction in which they will affect sanctions without being aware of the particular context where sanctions are applied. For example, sanctions must be multilateral in order for them to exert resource denial; however this is not necessary in the case of coercion -- the example of Taiwan shows that sanctions were highly effective when applied by a single player with an important or unique relationship with the target state.

This research has shown that sanctions have sometimes slowed down nuclear programs, and that their effects can be understood in two analytically distinct processes called resource denial and coercion. By separating the physical impact of sanctions from their coercive effects, the analysis helps build on the proliferation literature that classifies explanations for nuclear programs based on technology and motivations. As seen here, a nuclear program can be slowed down by denying appropriate technical and financial resources and/or by affecting a regime’s cost-benefit calculus. In the cases examined, the paramount motivation for the nuclear program has been security concerns, which are often coupled with considerations of domestic politics.

Thus coercive attempts to end nuclear programs must be sensitive to these issues in the target.

The dissertation clearly shows that the effects of sanctions on a country’s nuclear program greatly depend on the particular context where they are used. More than anything, then, this analysis underlines the context-dependent nature of the sanctions impact. This means that we cannot generalize a priori on the effect of sanctions based on such factors as whether they are multilateral or unilateral, whether they are threatened or imposed, whether the target is an ally or adversary, or whether the target is autocratic or democratic. These and other factors do

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affect the working of sanctions, but their influence ultimately depends on the overall situation.

This means that policymakers must be wary when using this instrument of state policy as the final impact of sanctions depends on a range of factors that are beyond their control.

Contributions to the Conventional Wisdom

The role of sanctions in nuclear restraint is a little-researched topic. One recent work remains the sole full-length study on the subject.476 In offering detailed country analyses, this dissertation has attempted to deepen our understanding of both nuclear programs and the impact of sanctions on the programs. The analysis shows that sanctions often had at least some impact on the target; whether they contributed to nuclear restraint seemed to depend on numerous other contextual factors. The sanctions literature has highlighted many such factors, but is often unclear about the direction in which they affect target compliance. For example, while most argue that multilateral sanctions are necessary for success, others hold that unilateral sanctions work better. Such disagreements on the impact of particular factors show the deep divisions within the literature, and the ultimate uncertainty on the final impact of sanctions. Instead of focusing on particular factors, I offer a way to understand the working of sanctions in terms of two broad processes. Sanctions can either constrain the physical ability to pursue nuclear weapons, or they can affect the motivations of leaders, or both.

My analysis shows that the factors affecting sanctions success depends on the process – resource denial by sanctions is successful only when sanctions are universal; for motivational changes, there must be clear communication on what is demanded, what is threatened, and, perhaps most importantly, what will be gained from restraint. In the latter process, the target must be persuaded to undertake restraint, and therefore success will depend on what the target

476 Solingen, Sanctions, Statecraft, and Nuclear Proliferation.

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values and the promise that it can obtain at least some of its preferences. In resource denial, however, sanctions can restrict the program irrespective of target interests. Therefore this dissertation breaks away from the larger sanctions literature in presenting a conceptual way to understand the processes by which sanctions work and do not work.

The dissertation also makes an important contribution in classifying three types of nuclear restraint – Slow, Stop, and Rollback. The proliferation literature does not offer such an elaboration on the concept of restraint, usually considering these various categories under the general rubric of restraint or reversal. I offer a valuable distinction between different types of restraint, emphasizing the puzzle of nuclear rollback.

By explaining restraint in terms of resource or motivational factors, I help distinguish between unintended and intended restraint. Although restraint is commonly of the intended variety i.e. brought about by motivational factors, on rare occasions it has been imposed by military attacks or the denial of resources. The case studies show instances where dramatic resource constraints do little to change motivations, while less stringent resource effects can be associated with significant motivational changes. For example, the extensive economic damage from sanctions did little to change Saddam Hussein’s motives for the nuclear program, while the threat of UN sanctions helped convince Iranian leaders to undertake a brief period of restraint.

The dissertation uses Sagan’s three-fold classification of motives to systematically explain the concept of nuclear restraint. Apart from a few studies, the literature does not offer such a conceptual explanation of restraint, the discussion of which tend to be sui generis. This research presents a theoretical explanation of restraint by building on Sagan’s work, showing a number of processes that can operate within each model. In the security model, Sagan limits his discussion to only one process, according to which restraint is brought about by decreases in

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security threats. However, the case studies in the dissertation actually display instances of restraint where security threats often worsened. In such instances, the security model can be better understood in terms of the perceived insecurities from the nuclear program. This argument is mentioned by T. V. Paul.477 Similarly, in the domestic politics model, Sagan stresses the role of individual leaders and changes in governments as possible explanations of restraint.478 In the overwhelming majority of cases studied here, restraint was not associated with a change in government. Rather, the primary domestic politics imperative arose from domestic challenges to the leadership, which perceived some domestic benefits from restraint.

Finally, the analysis shows how prestige considerations largely bolstered pursuit rather than restraint. As argued elsewhere in the literature, restraint can bring with it significant losses in terms of being seen as succumbing to external pressure.479 This can act as a significant dampener on the prestige motivation for restraint.

477 Paul, Power Versus Prudence.

478 Sagan, “Why Do States Build Nuclear Weapons?”.

479 Drezner, Sanctions Paradox.

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SELECTED BIBLIOGRAPHY

This selection of materials used for the dissertation lists the key sources, classified into broad categories according to the source. This list excludes archival material and statistical sources, which are mentioned in detail in individual chapters.

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Gedye, Robin. 2003. UN should fight for rights, says Berlusconi. The Telegraph. 4 September.

Gellman, Barton. 1991. Allied Air War Struck Broadly in Iraq. Washington Post. June 23. Page A1.

Gellman, Barton and Ann Devroy. 1991. US Studies Use of Force on Iraqi Nuclear Program. Washington Post. June 28. Page A1.

Gellman, Barton and Ann Devroy. 1992. Powell Said to Oppose New Strike on Iraq. Washington Post. March 20. Page. A1.

Gootman, Elissa. 2006. Security Council Approves Sanctions Against Iran Over Nuclear Program. New York Times. December 24.

Goshko, John M. “UN Approves Resolution for Formal End of Gulf War”, Washington Post, April 4, 1991.

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Graham, Robert. 2004. Libya and France agree Dollars 170m payout over airline deaths. Financial Times. London. January 10. Edition 1. Page 9.

Greenberg, Joel. 1993. Libyans Cut Short a Visit to Israel. New York Times. June 2. Page 7.

Gurtov, Melvin. 1967. Taiwan in 1966: Political Rigidity, Economic Growth. Asian Survey. 7(1).

Gwertzman, Bernard. 1984. US Restores Full Ties With Iraq But Cites Neutrality in Gulf War. New York Times. November 27. Page A1.

Hart, Gary. 2004. My Secret Talks with Libya, And Why They Went Nowhere. Washington Post. January 18. Page B05.

Hibbs, Mark 1992a. Bonn reiterates No to Bushehr; Iran ‘still region of tension’. Nucleonics Week. 33 (32). August 6.

Hibbs, Mark. 1992b. Iran sought sensitive nuclear supplies from Argentina, China. Nucleonics Week. 33 (39). September 24.

Huband, Mark. Libya softens on Lockerbie despite cracks in sanctions. Financial Times. February 15. Page 4. London.

Ibrahim, Youssef M. 1981. Libya and the World. Interview with Qaddafi. Survival. 22 (2). March-April.

Ignatius, David. 2006. Iran’s Uranium Glitch: Technical Troubles Offer Time for Diplomacy. Washington Post. September 29. Final Edition. Page A21.

Indyk, Martin S. 2004a. The Iraq war did not force Gadaffi’s hand. Financial Times. London. March 9.

Indyk, Martin S. 2004b. How Bush’s Doctrine of Pre-emption was Ambushed by Reality. The Age (Australia). March 26.

“Iraq Agrees to Begin Destruction of a Nuclear Complex, UN Says.” New York Times. April 8, 1992. Page A11.

Iran ‘has second enrichment site’. BBC. 25 September. 2009.http://news.bbc.co.uk/2/hi/8274262.stm. Accessed May 15, 2011

Iran Leader Rejects Even Brief Halt in Its Uranium Enrichment Efforts. AFP. Agence France-Presse. October 1, 2006. Late Edition.

Iran Must Allow Nuclear Inspections. Al Jazeera. 16 June. 2003.http://english.aljazeera.net/archive/2003/06/200849135643607188.html. Accessed April 28, 2011.

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Iran Nuclear Installations. Interview with John Bolton. BBC. 20 June. 2003. http://news.bbc.co.uk/2/hi/programmes/newsnight/archive/3007144.stm. Accessed April 28, 2011

Iran’s First Nuclear Power Plant Goes Into Operation. New York Times. September 4. 2011.

Iran’s nuclear negotiator resigns. BBC. 20 October. 2007.http://news.bbc.co.uk/2/hi/7053963.stm. Accessed April 4, 2011

Iran: Nuclear Talks Linked To Sanctions. New York Times. 19 August. 2010. Page 8.

Iran Scraps A-Plant Plan. Washington Post. March 11. 1980. Page A 12.

Iran Threatens to Quit NPT. Al Jazeera. 20 September. 2005. http://english.aljazeera.net/archive/2005/09/2008410102716177896.html. Accessed April 28, 2011.

Iran: Too divided for nuclear deal? BBC. 5 November. 2009.http://news.bbc.co.uk/2/hi/8343990.stm. Accessed April 5, 2011

Iraq war swayed Gaddafi’s WMD decision. The Strait Times. 2004. December 24. Singapore.

Kelley, Matt. 2004. US displays some of nuclear equipment seized in Libya. Associated Press. 15 March.

Kessler, Glenn. 2007. N. Korea, Syria May Be at Work on Nuclear Facility. Washington Post. September 13. Page A 12.

Kessler, Glenn. 2007. 2003 Memo Says Iranian Leaders Backed Talks. Washington Post. February 12.

Khalaf, Roula. 1999. Gadaffi’s Big Gamble. Financial Times. London. April 6. Edition 1. Page 18.

Lancaster, John and John M. Goshko. 1991. Iraq Said to Yield on Nuclear Inspection. Washington Post. Final Edition. September 25. Page A1.

Landler, Mark. 2005a. Nuclear Agency Expected to Back Weaker Rebuke to Iran. New York Times. September 24, 2005. Late edition.

Lander, Mark. 2005b. Nuclear Agency Votes to Report Iran to UN Security Council for Treaty Violations. New York Times. September 25, 2005. Late edition.

Lander, Mark and Elaine Sciolino. 2005. United States and Europe Differ Over Strategy on Iran. New York Times. January 29.

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Leverett, Flynt. 2004. Why Libya Gave Up on the Bomb. New York Times. January 23. Late edition. Page 23.

Lewis, Paul. 1991a. “Baghdad Detains 40 UN Inspectors Who Find A-Plans”. New York Times. September 24. East Coast edition, p. A1.

Lewis, Paul. 1992. Iraq Agrees to Destroy Missiles To Meet UN Ceasefire Terms. New York Times. March 21. Page. 1.

Lewis, Paul. 1992. UN Aide Tells Iraq it Risks Attack for Truce Defiance. New York Times. Late Edition – Final. July 18. Section 1, Page 3.

Lewis, Paul. 1992. UN Officials to Persevere in Talks to End Standoff Over Iraqi Arms. New York Times. Late Edition. July 19. Page 12.

Lewis, Paul. 1991b. “44 UN Inspectors Freed by Iraq With Secret Nuclear Documents”. New York Times. September 28. East Coast edition, p. 1.

Libya abandons plans for first unit. Nuclear Engineering International 1986. April. Volume 31 (No. 381).

1994. Libya Blinks on Lockerbie. New York Times. March 28. Late edition. Page 14.

Libya Radio. Africa In, Arabs Out. BBC World News. October 13., 1998.http://news.bbc.co.uk/2/hi/africa/192759.stm Accessed July 16, 2010.

Libyans Sentenced for French Bombing. BBC World News. March 10, 1999.http://news.bbc.co.uk/2/hi/294306.stm Accessed July 16, 2010.

Libya’s Restive Tribes. Jane’s Information Group. www.janes.com. 18 August. 1994.

“Libya thirsts for ‘fossil water’”. BBC World Service. 18 March, 2006. http://news.bbc.co.uk/2/hi/science/nature/4814988.stm Accessed April 23, 2012.

Linzer, Dafna. 2005. Europeans Agree to Meeting With Iran on Nuclear Program. Washington Post. May 17. Final Edition.

Lippman, Thomas W. 1994. Libya Marks Tragic Date With Bid to Lift Sanctions; US Trial for Bombing Suspects Rejected. Washington Post. December 22. Page A28.

Liu, Melinda. 1976a. Accounting for the N-factor. Far Eastern Economic Review. December 17.

------1976b. Taiwan’s Power Game. Far Eastern Economic Review. December 17.

Lynch, Colum. 2007. UN Backs Broader Sanctions on Tehran. Washington Post. March 26.

529

MacAskill, Ewen. 2007. Middle East: Target Iran: US able to strike in the spring: Despite denials, Pentagon plans for possible attack on nuclear sites are well advanced. The Guardian. 10 February. London.

MacAskill, Ewen. 2009. International: US backs down for Iran nuclear talks: Demands to stop uranium enrichment to be dropped: Negotiations more urgent since Israel’s new threats. Guardian. London. 15 April.

Marcus, David L. 1998. US Gives a Mixed Signal on Troop Use. Boston Globe. City Edition. February 10. Page A1.

Patri, Neel. 1991. India says research reactor sale to Iran is in preliminary stages. Nucleonics Week. 32 (48). November 28.

Preston, Julia. 1993. UN Council Adds Sanctions on Libya. Washington Post. November 12. Page A39.

Profile: Hassan Rowhani. BBC. 30 November. 2003. http://news.bbc.co.uk/2/hi/middle_east/3240618.stm Accessed May 22, 2012.

“A Nuclear Taiwan?”editorial. Washington Post. August 31, 1976, A14.

Qaddafi, Muammar. 2003. Interview with Charles Lambroschini. Le Figaro. Paris. March 11. http://www.worldpress.org/europe/989cfm#down Accessed February 11, 2011.Sanctions begin to bite. Economist. 10 September. 2010. Volume 397, Issue 8703.

Sanger, David E. 2010. Beyond Iran Sanctions That Probably Won’t Work, Plans B, C, D… New York Times. June 11. Late Edition – final. Page 12.

Sanger, David. E. 2011. Iran Moves to Shelter Its Nuclear Fuel Program. New York Times. September 1.

Sanger, David E. 2012. Obama Order Sped Up Wave of Cyberattacks Against Iran. New York Times. June 1.

Sanger, David E. and Jack Healy. 2010. Iran Bars Nuclear Inspectors In Response to Sanctions. New York Times. June 22. Page 11.

Sanger, David E. and Michael Slackman. 2010. US IS Skeptical on Iranian Deal for Nuclear Fuel. New York Times. May 17.

Sanger, David, E. 2011. In US-Libya Nuclear Deal, a Qaddafi Threat Faded Away. New York Times. March 1.

“Saudis will Pay for Repairs on Iraq’s Reactor”. New York Times. July 17, 1981.

Schumacher, Edward. 1976. Taiwan Seen Reprocessing Nuclear Fuel. Washington Post. August 29.

530

Schumacher, Edward. 1986-87. The United States and Libya. Foreign Affairs. 65 (2). Winter.

Sciolino, Elaine. 2003. Iran Will Allow UN Inspections of Nuclear Sites. New York Times. October 22. Page A1.

Seumas Milne. 2007. The fallout from an attack on Iran would be devastating. Guardian (London). October 4.

Slavin, Barbara. 2004. Libya’s rehabilitation in the works since early ‘90s. USA Today. April 26.

Slevin, Peter. 2003. Libya Accepts Blame in Lockerbie Bombing. Washington Post. August 17. Page A01.

Smith, Stephen. United States and Britain Sidelined France in Libya. Le Monde. Paris. January 10. From World News Connection.

Soviets draw back from helping Libyan programme. Nuclear Engineering International. 1987. Volume 32 (No. 401).

Suskind, Ron. 2006. The Tyrant Who Came In From the Cold. Washington Monthly. October. http://www.washingtonmonthly.com/features/2006/0610.suskind.html. Accessed August 31, 2011.

UN Sets Deadline for Iran on Nuclear Arms. New York Times. September 13. 2003. Page A2.

“UN Unit, Back from Iraq, Says It Was Denied Inspection Access.” New York Times. July 5, 1991. Page A4.

US sets nuclear deadline for Iran. BBC. 19 July. 2008. http://news.bbc.co.uk/2/hi/7515589.stm Accessed April 4, 2011.

“ Taiwan Abjures Atom Arms”. New York Times. Reuters December 21, 1978, A9.

Tyler, Patrick E. 1992b. US Aides Split Over Whether to Attack Iraq for Defying UN. New York Times. Late Edition. July 23. Page 6.

Tyler, Patrick E. 1991a. US Officials Believe Iraq Will Take Year to Rebuild. New York Times. Late Edition, East Coast. June 3. Page. A1.

Tyler, Patrick E. 1991b. US Scraps Plans to Send Copters and Jets to Saudis. New York Times. Late Edition. September 27. Page 1, Column 6.

Tyler, Patrick E. 1992a. US Ships Enter Gulf as Iraq and UN Spar Over Truce Conditions. New York Times. March 14. Page 5.

531

Tyler, Patrick E. and Eric Schmitt. 1992. Pentagon Charts Military Options for Bombing Iraq. New York Times. March 19. Page A1.

Tyler, Patrick E. 2004. Libyan Stagnation a Big Factor in Qaddafi Surprise. New York Times. January 8.

Tyler, Patrick. 2004. What has come over Libya’s leader? Experts Puzzle Out Promise to Disarm. New York Times. January 10. Page 1.

“U.S. Aid to Taiwan Totals A Billion: Nationalist China Could Not Have Maintained Economy and Army Otherwise.” New York Times. September 7, 1958.

Vaez, Ali and Charles D. Ferguson. 2011. An Iranian Offer Worth Considering. New York Times. September 29.

Vick, Karl. 2003. Iranian Hard-Liners Wary of Nuclear Deal; UN Agency to Weigh Action on Past Violations. Washington Post. November 20. Final Edition.

Waring, Gerald. 1969. Canadians Selling Reactor to Taiwan. Washington Post. September 17.

Warrick, Joby. 2004. Iranians Bar Further Nuclear Inspections. Washington Post. March 14.

Weiner, Tim. 1997. How a Spy Left Taiwan in the Cold: An Unsung American Agent Defused a Nuclear Weapons Threat. New York Times. December 20.

Weisman, Steven R. 2002. Iran Is Going Ahead With Nuclear Plant, Despite US Concerns. New York Times. December 25, 2002.

Weisman, Steven R. 2003. New US Concerns of Iran’s Pursuit of Nuclear Arms. New York Times. May 8. Page A1.

Weisman, Steven R. 2003. US Will Keep Penalties Against Libya, Officials Say. New York Times. August 15. Page 12.

Weisman, Steven R. 2007. Lack of ID Data Impedes UN Sanctions Against Iran. New York Times. September 17. Late Edition – Final. Page 3.

W. German Company Cancels Nuclear Contract With Iran. Washington Post.August 1. 1979. Page A 18.

Whitney, Craig R. 1997. France Charges 6 Libyans With ’89 Sahara Jet Bombing. New York Times. May 8. Late Edition – Final. Section A, Page 5.

Wright, Robin. 2005. US, Allies May Have to Wait Out Iran’s Presidential Vote. Washington Post. March 13. Final edition. A16.

532

Yang, John E. and John M. Goshko. 1991. Bush Says Iraq Violates Cease-Fire: Pentagon Preparing Range of Options. Washington Post. June 29. Page A1.

Yong, William and Robert F. Worth. 2010. Bombings Hit Atomic Experts in Iran Streets. New York Times. November 29.

4. ONLINE ARTICLES, REPORTS BY NON-GOVERNMENTAL AGENCIES, AND WEBSITES

Albright, David. 2002. Iraq’s Programs to Make Highly Enriched Uranium and Plutonium for Nuclear Weapons Prior to the Gulf War. ISIS Report. October 1. Institute for Science and International Security. http://isis-online.org/isis-reports/detail/iraqs- programs-to-make-highly-enriched-uranium-and-plutonium-for-nuclear-we/9Accessed October 19, 2011.

Albright, David and Corey Hinderstein. 2006. The Clock is Ticking, But How Fast? ISIS Report. March 27. Institute for Science and International Security, Washington DC. http://isis-online.org/uploads/isis-reports/documents/clockticking.pdf Accessed May 31, 2012.

Albright, David and Jacqueline Shire. 2006. Iran’s Centrifuge Program: Defiant But Delayed. ISIS Report. August 31. Institute for Science and International Security, Washington DC. http://isis-online.org/uploads/isis- reports/documents/defiantbutdelayed.pdf Accessed May 31, 2012.

Albright, David, Jacqueline Shire and Paul Brannan. 2007. IAEA Safeguards Report on Iran: Iran making progress but not yet reliably operating an enrichment plant. ISIS Report. May 25. Institute for Science and International Security, Washington DC. http://isis-online.org/uploads/isis-reports/documents/IranSafeguards25May2007.pdf Accessed May 31, 2012

Albright, David, Jacqueline Shire and Paul Brannan. 2008. May 26, 2008 IAEA Safeguards Report on Iran: Centrifuge Operation Improving and Cooperation Lacking on Weaponization Issues. Rev 2. May 29. ISIS Report. Institute for Science and

533

International Security, Washington DC. http://isis-online.org/uploads/isis- reports/documents/ISIS_Iran_IAEA_Report_29May2008.pdf Accessed May 31, 2012

Battle, Joyce. 2004. Saddam Hussein talks to the FBI. NSA Electronic Briefing Book No. 279. National Security Archive, George Washington University. http://www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB279/index.htm Accessed January 31, 2012.

Battle, Joyce 2003. Shaking Hands with Saddam Hussein: The US Tilt Toward Iraq, 1980-1984. National Security Archive Electronic Briefing Book No. 82. February 25. George Washington University. http://www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB82/ Accessed June 18, 2012.

Bolton, John. 2002. Beyond the Axis of Evil: Additional Threats from Weapons of Mass Destruction. Speech to the Heritage Foundation. Published May 6.

Boucek, Christopher. 2004. Libya’s Return to the Fold? FPIF Policy Report. April. Globalsecurity.org

Burr, William. 1999. New Archival Evidence on Taiwanese “Nuclear Intentions”, 1966- 1976. National Security Archive Electronic Briefing Book No. 19. National Security Archive: George Washington University. October 13. http://www.gwu.edu/~nsarchiv/NSAEBB/NSAEB20/. Accessed March 15, 2008.

Burr, William. 2007. US Opposed Taiwanese Bomb During 1970s. Electronic Briefing Book No. 221, National Security Archive, George Washington University, June 15. http://www.gwu.edu/~nsarchiv/nukevault/ebb221/index.htm

Anthony H. Cordesman. 2002. Weapons of Mass Destruction in the Middle East. Center for Strategic and Intelligence Studies. January 31.

Federation of American Scientists, “Militarily Critical Technologies List”, Part II “Weapons of Mass Destruction Technologies”, Section 5 “Nuclear Weapons Technology”. http://www.fas.org/irp/threat/mctl98-2/p2sec05.pdf Accessed August 13, 2012.

Feldman, Yana and Charles Mahaffey. Undated. Libya. Countries of nuclear strategic concern. SIPRI series. http://www.sipri.org/research/disarmament/nuclear/researchissues/past_projects/issues_of _concern/libya Accessed March 10, 2010

IAEA. 2009. Country Profiles: Islamic Republic of Iran. Updated March 2009. http://www- pub.iaea.org/MTCD/publications/PDF/cnpp2009/countryprofiles/Iran/Iran2008.htm

Accessed January 7, 2011.

534

ISIS. Institute for Science and International Security. Nuclear History. Nuclear Iran. http://www.isisnucleariran.org/nuclear-history/.Accessed January 7, 2011.

IISS. 2011. Iran’s Nuclear, Chemical, and Biological Capabilities: A Net Assessment. Strategic Dossier. Edited by Mark Fitzpatrick. February. London: International Institute for Strategic Studies.

Leverett, Flynt and Hillary Mann Leverett. 2010a. Sanctions, the TRR, and the Future of Nuclear Diplomacy: An Iranian Perspective. July 29. http://www.raceforiran.com/sanctions-the-trr-and-the-future-of-nuclear-diplomacy-an- iranian-perspective. Accessed April 18, 2011.

Leverett, Flynt and Hillary Mann Leverett. 2010b. Enrichment Still the Key To Nuclear Diplomacy with Iran. August 2.http://www.raceforiran.com/enrichment-still-the-key-to- nuclear-diplomacy-with-Iran. Accessed April 18, 2011.

IISS. 2007. Nuclear Black Markets: Pakistan, A. Q. Khan and the Rise of Proliferation Networks. A Net Assessment. Edited by Mark Fitzpatrick. London: International Institute for Strategic Studies. May.

Nuclear Programmes in the Middle East: In the Shadow of Iran. International Institute for Strategic Studies. London. 2008.

Nuclear Threat Initiative http://nti.org/

Posch, Walter. 2007. Only personal? The Larijani Crisis Revisited. Durham University, Centre for Iranian Studies. Policy Brief #3. November. http://www.dur.ac.uk/resources/iranian.studies/larijani_final01.pdf. Accessed April 5, 2011

Saeed, Ferial Ara. 2010. Redefining Success: Applying Lessons in Nuclear Diplomacy from North Korea to Iran. Strategic Perspectives 1. Center for Strategic Research, Institute for National Strategic Studies, National Defense University. http://www.ndu.edu/inss/docuploaded/strategicperspectives_saeed.pdf Accessed May 22, 2012.

Shire, Jacqueline and David Albright. 2007. Iran’s Centrifuges: How well are they working? ISIS Report. Institute for Science and International Security, Washington DC. March 15.http://isis-online.org/uploads/isis-reports/documents/IranUF6.pdf Accessed May 31, 2012

Shire, Jacqueline and David Albright. 2007. IAEA Safeguards Report on Iran: Limited Progress in enrichment; controversial strategy on outstanding issues; continued defiance of UN Security Council. ISIS Report. August 30. Institute for Science and International Security, Washington DC. http://isis-online.org/uploads/isis- reports/documents/IranIssueBrief30August2007.pdf Accessed May 31, 2012.

535

Walrond, Christina. 2009. Timeline 1967-1993: Argentine Low-Enriched Uranium at Tehran Research Reactor. October 7. Institute for Science and International Security Report. http://www.isisnucleariran.org/assets/pdf/Tehran_reactor_timeline.pdf. Accessed September 19, 2011

Yaphe, Judith S. and Charles D. Lutes. 2005. Re-assessing the Implications of a Nuclear- armed Iran. McNair Paper 69. Washington, DC: Institute for National Strategic Studies, National Defense University. http://www.ndu.edu/inss/docuploaded/McNair69.pdf Accessed June 25, 2012

5. REPORTS BY NATIONAL AGENCIES

Blanchard, Christopher M. 2005. Libya. CRS Issue Brief for Congress. June 14.

Squassoni, Sharon A. and Andrew Feickert. 2004. Disarming Libya: Weapons of Mass Destruction. CRS Report for Congress. April 22.

Katzman, Kenneth. 2002. Iran: Current Developments and US Policy. Issue Brief for Congress. June 10. IB93033.

Katzman, Kenneth. 2010a. Iran Sanctions. CRS Report for Congress. December 13. Congressional Research Service. RS20871.

Katzman, Kenneth. 2010b. Iran: US Concerns and Policy Responses. CRS Report for Congress. December 22. Congressional Research Service. RL32048.

Katzman, Kenneth. 2012. Iran Sanctions. CRS Report for Congress. March 28. RS20871.

CIA. 1988. Middle East- South Asia: Nuclear Handbook. Directorate of Intelligence. http://www.foia.cia.gov/docs/DOC_0001033097/DOC_0001033097.pdf. Accessed September 26, 2011.

CIA. 2001. Unclassified Report to Congress on the Acquisition of Technology Relating to Weapons of Mass Destruction and Advanced Conventional Munitions, 1 January through 30 June 2001. https://www.cia.gov/library/reports/archived-reports- 1/jan_jun2001.htm#6. Accessed June 14, 2012.

CIA. 2003. Unclassified Report to Congress on the Acquisition of Technology Relating to Weapons of Mass Destruction and Advanced Conventional Munitions, 1 January through 30 June 2003. Digital National Security Archive.

Galdi, Theodore W. and Robert D. Shuey. 1988. US Economic Sanctions Imposed Against Specific Foreign Countries 1979 to the Present. CRS Report for Congress. Revised September 9. 88-612F.

536

ISG Report. 2004. Comprehensive Report of the Special Advisor to the DCI on Iraq’s WMD. 30 September.

Rennack, Dianne E. 2004. Libya: Legislative Basis for US Economic Sanctions. CRS Report for Congress. September 22.

US Department of Defense. 2001. Proliferation: Threat and Response. January. http://www.dod.gov/pubs/ptr20010110.pdf Accessed August 10, 2011.

US Department of State. 2008. U.S.-Libya Relations, 1786-2008: Narrative summary outlines the history of the U.S.-Libyan relationship. 9 September. http://www.america.gov/st/texttrans- english/2008/September/20080909134952xjsnommis0.7052118.html Accessed August 31, 2011.

6. INTERNATIONAL AGREEMENTS AND REPORTS BY INTERNATIONAL AGENCIES

Ahtisaari, Martti. 1991. Report to the Secretary-General on Humanitarian Needs in Kuwait and Iraq in the Immediate Post-Crisis Environment. S/22366. 20 March. Available at http://www.un.org/Depts/oip/background/reports/s22366.pdf September 21, 2009.

INFCIRC/729. 2008. Communication dated 16 June 2008 received from the Permanent Mission of the Islamic Republic of Iran to the Agency concerning the text of the “Islamic Republic of Iran’s proposed package for constructive negotiation”. IAEA Information Circular. 18 June.

INFCIRC/730. 2008. Communication dated 25 June 2008 received from the Resident Representative of the United Kingdom to the Agency concerning a letter and offer of 12 June 2008 delivered to the Islamic Republic of Iran. IAEA Information Circular. 1 July.

Elements of Objective Guarantees. 2005. Presented by Iran at the Meeting of the Steering Committee, Paris. March 23. http://www.armscontrol.org/pdf/20050323_Iran_Proposal_Steering_Cmte.pdf. Accessed March 23, 2011.

Framework for a Long Term Agreement between the Islamic Republic of Iran and France, Germany, and the United Kingdom, with the support of the High Representative of the European Union. 2005. INFCIRC/651. Communication dated 8 August 2005 received from France, Germany and the United Kingdom to the Agency. 8 August. http://www.armscontrol.org/pdf/20050805_Iran_EU3_Proposal.pdf. Accessed April 20, 2011.

537

GC(41)/INF/20. 30 September 1997. Document submitted by the Permanent Mission of Iraq to the International Atomic Energy Agency. “Iraq’s fulfillment of the obligations under Section C of UNSCR 687 (1991) (nuclear part)” by National Monitoring Directorate, Baghdad, Republic of Iraq, 24 September 1997. Available at www.iaea.org or http://www.iaea.org/About/Policy/GC/GC41/GC41InfDocuments/English/gc41inf- 20_en.pdf Accessed March 16, 2010

IAEA. 1997. Fourth Consolidated Report of the Director General of the International Atomic Energy Agency. October 7.

GOV/2003/40. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Report by the IAEA Director General. 6 June 2003.

GOV/2003/63. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Report by the IAEA Director General. 26 August 2003.

GOV/2003/69. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Resolution adopted by the IAEA Board. 12 September 2003.

GOV/2003/75. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Report by the IAEA Director General. 10 November 2003.

GOV/2003/81. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Resolution adopted by the IAEA Board on 26 November 2003. 26 November 2003.

GOV/2004/11. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Report by the IAEA Director General. 24 February 2004.

GOV/2004/21. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Resolution adopted by the IAEA Board on 13 March 2004. 13 March 2004.

GOV/2004/60. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Report by the IAEA Director General. 1 September 2004.

GOV/2004/79. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Resolution adopted by the IAEA Board. 18 September 2004.

GOV/2004/83. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Report by the IAEA Director General. 15 November 2004.

GOV/2005/67. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Report by the IAEA Director General. 2 September 2005.

538

GOV/2005/77. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Resolution adopted by the IAEA Board. 24 September 2005.

GOV/2006/14. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Resolution adopted by the IAEA Board. 4 February 2006.

GOV/2006/15. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Report by the IAEA Director General. 27 February 2006.

GOV/2006/27. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Report by the IAEA Director General. 28 April 2006.

GOV/2006/53. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Report by the IAEA Director General. 31 August 2006.

GOV/2006/64. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Report by the IAEA Director General. 14 November 2006.

GOV/2007/8. Implementation of the NPT Safeguards Agreement and Relevant Provisions of Security Council Resolution 1737 (2006) in the Islamic Republic of Iran. Report by the IAEA Director General. 22 February 2007.

GOV/2007/22. Implementation of the NPT Safeguards Agreement and Relevant Provisions of Security Council Resolutions in the Islamic Republic of Iran. Report by the IAEA Director General. 23 May 2007.

GOV/2007/48. Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran. Report by the IAEA Director General. 30 August 2007.

GOV/2007/58. Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions 1737 (2006) and 1747 (2007) in the Islamic Republic of Iran. Report by the IAEA Director General. 15 November 2007.

GOV/2008/4. Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions 1737 (2006) and 1747 (2007) in the Islamic Republic of Iran. Report by the IAEA Director General. 22 February 2008.

GOV/2008/15. Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions 1737 (2006), 1747 (2007) and 1803 (2008) in the Islamic Republic of Iran. Report by the IAEA Director General. 26 May 2008.

GOV/2009/8. Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions 1737 (2006), 1747 (2007) and 1803 (2008) and 1835 (2008) in the Islamic Republic of Iran. Report by the IAEA Director General. 19 February 2009.

GOV/2009/74. Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions 1737 (2006), 1747 (2007), 1803 (2008), and

539

1835 (2008) in the Islamic Republic of Iran. Report by the IAEA Director General. 16 November 2009.

GOV/2010/10. Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions 1737 (2006), 1747 (2007), 1803 (2008), and 1835 (2008) in the Islamic Republic of Iran. Report by the IAEA Director General. 18 February 2010.

GOV/2010/28. Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions 1737 (2006), 1747 (2007), 1803 (2008), and 1835 (2008) in the Islamic Republic of Iran. Report by the IAEA Director General. 31 May 2010.

GOV/2010/46. Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions in the Islamic Republic of Iran. Report by the IAEA Director General. 6 September 2010.

GOV/2010/62. Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions in the Islamic Republic of Iran. Report by the IAEA Director General. 23 November 2010.

GOV/2011/7. Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions in the Islamic Republic of Iran. Report by the IAEA Director General. 25 February 2011.

GOV/2011/54. Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions in the Islamic Republic of Iran. Report by the IAEA Director General. 2 September 2011.

GOV/2011/65. Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions in the Islamic Republic of Iran. Report by the IAEA Director General. 8 November 2011.

Incentives Package. 2006. Text of P5+1 nuclear package of incentives offered to Iran. June 1. http://www.iranfocus.com/en/?option=com_content&task=view&id=7946. Accessed April 1, 2011

International Atomic Energy Agency, Fourth Consolidated Report of the Director General of the International Atomic Energy Agency (Vienna: IAEA), October 7, 1997.

IAEA Nucleus. Research Reactor Batch Report. http://nucleus.iaea.org/RRDB/Reports/Container.aspx?id=R1Accessed October 5, 2011

Iran Proposal. 2005a. Proposal by Iran, presented to Political and Security Working Group, Geneva, January 17, 2005. http://www.armscontrol.org/pdf/20050117_Iran_Proposal_PSWG.pdf . Accessed March 23, 2011

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Iran Proposal. 2005b. Proposal by Iran presented to the Meeting of the Steering Committee, London, April 29, 2005. http://www.armscontrol.org/pdf/20050429_Iran_Proposal_Steering_Cmte.pdf. Accessed March 23, 2011

Islamic Republic of Iran’s Response to the Package Presented on June 6, 2006. August 2006. http://isis-online.org/uploads/isis-reports/documents/responsetext_2.pdf . Accessed April 20, 2011

Letter from E3 Ministers and EU High Representative to Dr. Rowhani, August 5 2005, Communication dated 8 August 2005 received from the Resident Representatives of France, Germany and the United Kingdom to the Agency, INFCIRC/651.

Paris Agreement. 2004. Iran-EU Agreement on Nuclear Programme. 14 November. http://www.iaea.org/newcenter/focus/iaeairan/eu_iran14112004.shtml. Accessed January 27, 2011.

Roadmap for Comprehensive Negotiations with the United States. 2003. May.http://www.media.washingtonpost.com/wp- srv/world/documents/us_iran_roadmap.pdf. Accessed April 19, 2011

S/22456. 1991. Identical Letters Dated 6 April 1991 from the Permanent Representative of Iraq to the United Nations Addressed Respectively to the Secretary-General and the President of the Security Council. Security Council. 6 April.

S/22761. 1991. Report of a high-level mission sent to Iraq from 30 June to 3 July 1991. UN Document. 5 July.

S/23122. Note by the Secretary-General to the Security Council, October 8, 1991.

S/23295. 1991. Note by the Secretary-General to the Security Council, December 17, 1991.

S/23514. 1992. Report of the Secretary-General on the Status of Compliance by Iraq with the Obligations placed upon it under certain of the Security Council Resolutions relating to the situation between Iraq and Kuwait. 25 January, 1992.

S/1994/1138. Report of the Secretary-General on the Status of the implementation of the Special Commission’s Plan for the Ongoing Monitoring and Verification of Iraq’s Compliance with Relevant Parts of Section C of Security Council Resolution 687 (1991). 7 October 1994. http://daccessdds.un.org/doc/UNDOC/GEN/N94/383/83/PDF/N9438383.pdf?OpenEleme nt Accessed September 16, 2009

S/1995/844. Note by the Secretary-General. Security Council. 6 October, 1995.

S/1995/1003. Note by the Secretary-General. Security Council.1 December, 1995.

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S/1999/356. 1999. Letters dated 27 and 30 March 1999, respectively, from the Chairman of the Panels Established Pursuant to the Note that by the President of the Security Council of 30 January 1999 (S/1999/100) Addressed to the President of the Security Council. Security Council. 30 March 1999.

S/RES/984. Security Council Resolution 984. 11 April 1995.

S/RES/1696. Security Council Resolution 1696. 31 July 2006.

S/RES/1737. Security Council Resolution 1737. 23 December 2006.

S/RES/1747. Security Council Resolution 1747. 24 March 2007.

S/RES/1803. Security Council Resolution 1803. 3 March 2008.

S/RES/1929. Security Council 1929. 9 June 2010.

Tehran Agreed Statement. 2003. Statement by the Iranian Government and Visiting EU Foreign Ministers. 21 October. http://www.iaea.org/newscenter/focus/iaeairan/statement_iran21102003.shtml. Accessed January 27, 2011.

UN. 1996. The United Nations and the Iraq-Kuwait Conflict, 1990-1996. New York: United Nations, 1996.

UN Document S/22660. 1991. In The United Nations and the Iraq-Kuwait Conflict, 1990- 1996. New York: United Nations, 1996.

UN Data. Iraq: Per Capita GDP at Current Prices, 1970-2008.http://data.un.org/

UNMOVIC. 2003. Unresolved Disarmament Issues: Iraq’s Proscribed Weapons Programmes. 6 March. UNMOVIC Working Document. http://www.un.org/Depts/unmovic/new/documents/cluster_document.pdfAccessed January 17, 2012.

UNSCOM. UN Special Commission for Iraq. http://www.un.org/Depts/unscom/General/basicfacts.html. Accessed October 14, 2009

A/46/844 and S/23416. 13 January 1992. Letter dated 20 November 1991 from the Permanent Representative of the Libyan Arab Jamahiriya to the United Nations addressed to the Secretary-General.

S/23306. 31 December 1991. Letter dated 20 December 1991 from the Permanent Representative of France to the United Nations addressed to the Secretary-General.

S/23308. 31 December 1991. Letter dated 20 December 1991 from the Permanent Representative of the United States of America to the United Nations addressed to the Secretary-General.

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A/46/841 and S/23396. 9 January 1992. Letter dated 8 January 1992 from the Permanent Representative of the Libyan Arab Jamahiriya to the United Nations addressed to the Secretary-General.

S/23918. 14 May 1992. Letter dated 14 May 1992 from the Permanent Representative of the Libyan Arab Jamahiriya to the United Nations addressed to the Secretary-General.

S/24961. 16 December 1992. Letter dated 9 December 1992 from the Permanent Representative of the Libyan Arab Jamahiriya to the United Nations addressed to the Secretary-General.

S/1995/973. 20 November 1995. Letter dated 20 November 1995 from the Permanent Representative of the United Kingdom of Great Britain and Northern Ireland to the United Nations addressed to the President of the Security Council.

S/1998/83. 28 January 1998. Letter dated 27 January 1998 from the Permanent Observers of the League of Arab States and the Organization of the Islamic Conference to the United Nations addressed to the President of the Security Council.

S/1998/795. 24 August 1998. Letter dated 24 August 1998 from the Acting Permanent Representatives of the United Kingdom of Great Britain and Northern Ireland and the United States of America to the United Nations addressed to the Secretary-General.

S/1999/752. 6 July 1999. Letter dated 6 July 1999 from the Permanent Representative of the Libyan Arab Jamahiriya to the United Nations addressed to the President of the Security Council.

S/1999/1193. 18 November 1999. Letter dated 18 November 1999 from the Permanent Representative of the Libyan Arab Jamahiriya to the United Nations addressed to the President of the Security Council.

S/2000/864. 13 September 2000. Letter dated 11 September 2000 from the Minister for Foreign Affairs of Algeria, the Minister for Foreign Affairs of Egypt, the Secretary of the General People’s Committee for Foreign Liaison and Cooperation of the Libyan Arab Jamahiriya, the Minister for Foreign Affairs of Mauritania, the Minister for Foreign Affairs of Morocco, the Minister for Foreign Affairs of the Syrian Arab Republic and the Minister for Foreign Affairs of Tunisia addressed to the President of the Security Council.

GOV/2008/39. 12 September 2008. Implementation of the NPT Safeguards Agreement in the Socialist People’s Libyan Arab Jamahiriya. Report by the IAEA Director General.

GOV/2004/12. International Atomic Energy Agency, Implementation of the NPT Safeguards Agreement of the Socialist People’s Libyan Arab Jamahiriya, February 20, 2004.

GOV/2004/33. International Atomic Energy Agency, Implementation of the NPT Safeguards Agreement in the Socialist People’s Libyan Arab Jamahiriya, May 28, 2004.

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7. SPEECHES AND TALKS

Aghazadeh, Reza. 2002. Statement at the 46th General Conference. International Atomic Energy Agency. 16 September.http://www.iaea.org/About/Policy/GC/GC46/iran.pdf Accessed June 8, 2012

Bolton, John. 2002. Beyond the Axis of Evil: Additional Threats from Weapons of Mass Destruction. Speech to the Heritage Foundation. Published May 6.

ElBaradei. 2004. Introductory Statement to the Board of Governors. 25 November. http://www.iaea.org/newscenter/statements/2004/ebsp2004n016.html. Accessed May 20, 2011.

Rowhani, Hassan. 2005. Text of Speech to the Supreme Cultural Revolution Council. Beyond the Challenges Facing Iran and the IAEA Concerning the Nuclear Dossier. Rahbord (Persian). 30 September.http://www.david-morrison.org.uk/other- documents/rohani-sncc-2004autumn.pdf Accessed May 22, 2012.

Takeyh, Ray. 2002. Post-Lockerbie Judgment, What Next for US-Libya Relations? Washington Institute for Near East Policy. PolicyWatch #612. March 15. http://www.cianoet.org/pbei/winep/policy_2002/2002_612.html Accessed October 28, 2005.

8. OTHER US GOVERNMENT DOCUMENTS AND CONGRESSIONAL HEARINGS

DeSutter, Paula A. 2004a. US Government’s Assistance to Libya in the Elimination of Its Weapons of Mass Destruction (WMD). Testimony by the Assistant Secretary for Verification and Compliance before the Senate Foreign Relations Committee. February 26.

------. 2004b. “Completion of Verification Work in Libya”, Testimony before the Subcommittee on International Terrorism, Nonproliferation and Human Rights, September 22, 2004. http://www.state.gov/t/vci/rls/rm/2004/37220.htm

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House International Relations Committee. 2004. Disarmament of Libya’s Weapons of Mass Destruction. Hearing of the Committee on International Relations. House of Representatives. 108th Congress. September 22. US Government Printing Office.

Export Administration Act of 1979. 1979. Public Law 96-72. http://www.bis.doc.gov/policiesandregulations/ear/legal_authority.pdf Accessed June 19, 2012.

Hearing before the Subcommittees on Europe and the Middle East, and on International Economic Policy and Trade, of the Committee on Foreign Affairs House of Representatives , 96th Congress, Second session, May 14, 1980.

Rumsfeld, Donald H. 2002. Prepared Testimony to Senate Armed Services Committee Hearings on Iraq. September 19. http://armed- services.senate.gov/statemnt/2002/September/Rumsfeld.pdf. Accessed June 13, 2012

Tenet, George J. 2002. Converging Dangers in a Post-9/11 World. Testimony of Director of Central Intelligence George J. Tenet Before the Senate Select Committee on Intelligence (as prepared for delivery). February 6. https://www.cia.gov/news- information/speeches-testimony/2002/senate_select_hearing_03192002.html. Accessed June 13, 2012

Tenet, George J. 2003. The Worldwide Threat in 2003: Evolving Dangers in a Complex World. DCI’s Worldwide Threat Briefing (as prepared for delivery). February 11. https://www.cia.gov/news-information/speeches- testimony/2003/dci_speech_02112003.html. Accessed June 13, 2012

Tenet, George J. 2004. Challenges in a Changing Global Context. Testimony of the Director of Central Intelligence before the Senate Armed Services Committee. As prepared for delivery. March 9. https://www.cia.gov/news-information/speeches- testimony/2004/tenet_testimony_03092004.html. Accessed September 1, 2011

9. PERSONAL INTERVIEWS

Charles Duelfer (former Special Adviser to the Director of Central Intelligence for Iraqi WMD and former Deputy Executive Chairman of UNSCOM), interview by author, October 7, 2009, Maclean, Virginia.

Olli Heinonen (former Deputy Director General, IAEA), interview by author, October 2010, Cambridge, MA.

Robert G. Joseph (former Under Secretary of State for Arms Control and International Security), interview by author, October 8, 2009, Fairfax, Virginia.

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David Kay (former head of Iraq Survey Group), interview by author, October 7, 2009. Arlington, Virginia.

Seyyed Hossein Mousavian (former head of the Foreign Relations Committee, Iran’s Supreme National Security Council), phone interview by author, May 26, 2011.

Mahdi Obeidi (former head of Iraq’s centrifuge program), phone interview by author, February 2, 2012.

Mahdi Obeidi (former head of Iraq’s centrifuge program), phone interview by author, June 28, 2012.

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