Paul Daley
The Bulletin
February 2, 2006

Sydney: So you thought Doctor Strangelove died in the rubble of the Berlin Wall? And the N-bomb menace? About as relevant, you say, as Sting bleating on about the Russians loving their children, too? Prepare for a frightening truth. The New Terrorism that ushered in the 21st century with such terrible effect courtesy of suicide bombers and hijacked passenger planes is fast being superseded by a renewed global nuclear threat. And it’s not just terrorist groups like al-Qaeda who want to acquire or are threatening to use nuclear weapons. It seems the most onerous sabre-rattling today comes from the original nuclear powers ? including China, France and the United States ? and newcomers like Israel, Iran, Pakistan and India, which are developing, or already have, their own nukes.

Australia, which owns 40% of the world’s established uranium stocks, is central to the future of global nuclear power and, therefore, to weapons proliferation. China, an emerging superpower and repressive military regime with arguably little distinction between its nuclear energy and weapons programs, is energetically engaged in multi-billion-dollar negotiations with Canberra to buy Australian uranium to fuel its nuclear reactors. It plans to spend up to $40bn on a new program to ensure nuclear fuel provides up to 4% of its voracious domestic energy needs by 2010.

While the deal is worth potentially $450m a year to Australia’s uranium producers, it will be incumbent upon our political leaders to convince us of the virtually impossible ? that any atomic material derived from Australian yellowcake sent to China is used solely for peaceful purposes. At the outset of diplomatic negotiations between Beijing and the Department of Foreign Affairs and Trade on January 17 over the proposed Australia-China Nuclear Co-operation Treaty, Australian officials and politicians talked tough: Australia would insist on stringent "safeguards," they said, to ensure China couldn’t use our uranium for weapons. But that’s impossible to guarantee. Impossible, because any Australian safeguards will be predicated on the fundamentally flawed safety regime of the UN’s Vienna-based International Atomic Energy Agency, which makes inspections of nuclear facilities optional for the five original nuclear weapons states, namely the US, Britain, Russia, France ? and China. In the past few months everything old, at least in the world of weapons of mass destruction, has become new again, as threats and counter-threats of nuclear strikes have issued forth across the globe.

This month, apropos of little, soon-to-be-former French President Jacques Chirac announced Paris reserved the right to use its nuclear arsenal, its force de frappe, against state-sponsored terrorists. This coincided with Israel’s thinly veiled warning that it might launch a nuclear strike against new global bad boy, Iran, if Tehran continued to defiantly pursue its quest to enrich uranium, a critical process in the production of nuclear power ? and N-bombs. An overreaction? Just late last year the new Iranian president, Mahmoud Ahmadinejad, did, after all, declare that Israel should be "wiped off the map". Could this have been anything but a nuclear threat?

All the while China, fast becoming enough of a military and trade colossus to spook the US, last year warned Washington that its intervention in any military conflict over Taiwan would be met with a nuclear response.

"If the Americans draw their missiles and position-guided ammunition onto the target zone on China’s territory, I think we will have to respond with nuclear weapons," said Zhu Chenghu, a general in the People’s Liberation Army.

"We, Chinese, will prepare ourselves for the destruction of all the cities east of Xian. Of course, the Americans will have to be prepared that hundreds of cities will be destroyed by the Chinese."

This reverberated in Washington and Taipei, where there is growing alarm over Australia’s negotiations with China.

The Secretary-General of Taiwan’s National Security Council, Professor Parris Chang, told The Bulletin that Australia could become an unwitting "accomplice" in China’s nuclear weapons program and should not trust Beijing’s assurances that its nuclear energy and weapons programs are distinct. He also stridently criticised Australia for having "east-tilted" towards China and for putting trade with Beijing ahead of regional security.

"China’s assurance is not that valuable because we know China’s record of proliferation . . . and, yes, we know of China’s [nuclear technology] assistance to Iran, Iraq, North Korea and Pakistan. And so we look [at] what China is doing instead of just what China is saying," Chang says.

"Certainly, Australia doesn’t want to be seen as an accomplice in China’s manufacturing of nuclear weapons because the sale of uranium to China, even though the Chinese say this is for nuclear power use, well . . . the so-called peaceful use of the uranium could be transferred to the manufacture of nuclear weapons.

"Australia also ought to place a great emphasis on the peace and security of the South-East Asian area. In recent years we have noticed that Australia has almost east-tilted towards China because of trade considerations . . . even for the purpose of business, for the interests of Australia, [Taiwan thinks] that really, peace and security in East Asia would be very important."

Concerns such as Chang’s which, diplomatic sources maintain, are also held (albeit more discreetly) in the Pentagon, will, ironically, only make the prospect of a uranium deal with Australia all the sweeter for China.

One insider to the negotiations told The Bulletin that while Beijing’s priority was to secure a deal, "it will happily drive a wedge between Washington and Canberra on China policy and security policy relating to Taiwan.

"There is much more riding on this for China than just a uranium deal."

China is, indeed, playing a deft game with Canberra. It has been underscored almost from the outset by an implied threat that if it gets too difficult, Beijing will take its fantastically lucrative business elsewhere. Beijing also made it clear well before formal negotiations began that it would play hard-ball on safeguards and would not subject itself to further – or perhaps any ? IAEA inspections in relation to Australian uranium.

Last September, China’s leading arms control official, Zhang Yan, refused to say if Beijing would allow IAEA inspections as part of the safeguards governing the import of Australian uranium.

"I can’t give you an affirmative guarantee to that," he told The Australian.

Last December, meanwhile, China’s ambassador to Australia, Madam Fu Ying, reportedly told almost 600 of Australia’s leading mining executives that Australia needed to prove it was a "reliable" uranium supplier if it wanted the business.

"China really needs to be careful in where it chooses its source of supply," Fu said, adding that the "political environment" of supplier countries was a key factor.

"We don’t want this trade to be interrupted by other factors," she said.

While the Chinese embassy did not respond to The Bulletin’s repeated requests to interview Fu, insiders say she was effectively warning Australia not to complicate the deal with political bickering over safeguards or, indeed, the merits and safety of nuclear power.

It’s an argument likely to appeal to the pro-mining, pro-nuclear energy Foreign Minister Alexander Downer who, with the imprimatur of John Howard, strongly favours exporting Australian uranium to responsible buyers. The Chinese have gone out of their way to fete Downer over this deal.

"Australia holds the world’s largest uranium reserves, which enables us to make a major contribution to global energy production," he said in a major speech late last year. "It also means we have the responsibility and the opportunity to have a strong input on international efforts to counter proliferation of nuclear materials."

Downer and Howard will also be acutely mindful that any public debate on Australian uranium exports will draw attention to deep divisions in the Labor Party over its unworkable 1995 No New Mines Policy, which limits uranium production to the three existing mines ? the giant Olympic Dam (which has a third of the world’s uranium reserves) and Beverley mines in South Australia, and the Northern Territory’s Ranger mine. Labor’s state leaders have been seriously at odds over uranium policy. Some opponents, including Western Australia’s recently retired premier Geoff Gallop, argued uranium mining opened the possibility of fissile material falling into the hands of terrorists. Others, like former NSW premier Bob Carr, have been more equivocal while Gallop’s replacement, Alan Carpenter, foreshadowed a change to WA Labor’s stance on uranium mining when he took over. Uranium stocks spiked.

Washington has made it clear it expects Australian military support in the event of any conflict with China over Taiwan. But could, as critics maintain, fissile material derived from Australian uranium find its way into Chinese nuclear warheads fired at American ? or indeed, Australian ? interests in such circumstances?

The answer, it seems, is yes.

Sources maintain that Australian officials, led by the Australian Safeguards and Non-Proliferation Office ? the section of our foreign service charged with ensuring Australian Obligated Nuclear Material is used solely for peaceful means ? expect China will ultimately comply with what are in reality relatively relaxed safeguards imposed on other established nuclear weapons states, like Britain and the US, that have purchased our uranium. While the regulations allow export to countries, such as China, with both nuclear weapons and energy programs, such countries are only required to prove that the equivalent amount of yellowcake ? as opposed to the specific uranium in the shipment ? is used solely for power generation.

Any Australian uranium imported by China can, therefore, be mixed with uranium from elsewhere and used to make weapons ? so long as a portion of the total, equal to the size of the Australian take, is demonstrably used solely for energy production.

As ASNO noted in a 2000 report: "Uranium atoms are indistinguishable from one another and there is no practical way of attaching flags to atoms."

Since the 1970 Non-Proliferation Treaty, which made possession of nuclear weapons the sole prerogative of China and the other nuclear weapons states ? the Club of Five ? other states must subject themselves to IAEA inspections if they wish to acquire nuclear technology.

Numerous countries ? including North Korea, Pakistan, South Africa, India and now Iran ? have covertly developed nuclear weapons while enriching uranium for energy.

The inherent bias of the IAEA safeguards towards the Club of Five underpins the safety guidelines for Australian uranium exports, because only states outside the club are subject to additional international protocols of random inspection and verification.

Despite much conjecture, it remains unclear what safeguards China will ultimately accept. China has indicated it would prefer Australian officials ? rather than IAEA inspectors ? to enforce any requisite safeguards attached to the Australian deal.

A DFAT spokeswoman confirmed to The Bulletin that the safeguards being sought by Australia in relation to the proposed uranium deal were based on those of the IAEA.

She said Australia was confident that, in the event of a deal, no Australian uranium would make its way into China’s weapons program. "Consistent with other similar agreements China will be required to give a binding treaty-level commitment to use Australian uranium solely for peaceful purposes. Military purposes will be proscribed. It should be noted that Australian uranium would not be supplied to China for unspecified purposes, but would be sold to Chinese power utilities for electricity generation."

In the event of a deal, the spokeswoman said, Australians would not carry out inspections. "Under arrangements anticipated, the IAEA would conduct inspections ? ASNO would monitor the flow of Australian nuclear material in China through nuclear accountancy, analysis of reporting provided by counterparts, and other relevant information."

The Australian Conservation Foundation, which opposes nuclear power and uranium exports, is stepping up its campaign against the Australia-China Nuclear Co-operation Treaty. It says all states should be subject to the additional safeguards.

"Our understanding is that a deal is being put forward whereby China will be expected to sign up to the existing safeguard regime, that is a non-binding agreement that will allow China to exclude certain facilities from inspection or opt out, citing national security, altogether," says the ACF’s David Noonan.

"The ACF is also concerned that China ? which, according to a US Congressional report has exported weapons technology to Iran, Pakistan, North Korea, Libya and Syria ? does not make a real distinction between its nuclear weapons and energy programs and is opposed to any transparency in the process."

Despite the ambiguity surrounding China’s nuclear programs, others argue that supplying uranium to China for energy simply frees up other uranium for weapons.

"Yes, sure, of course, unavoidably so ? unless China were swimming in such a glut of uranium that it would never consider importing any. But if it is considering importing, then it presumably would not easily have enough for all its needs ? civilian and military ? without those imports," says Norman Rubin, director of Nuclear Research at Energy Probe, an anti-nuclear think-tank in Canada, another country negotiating uranium exports to China.

"In those circumstances, even if every atom of Australian uranium can be proved to have ended up in civilian use, Australia would still be helping China to meet its needs for military explosive uranium. One might as well argue that Australians should send money to al-Qaeda for flight training lessons, but not for knives or guns. In fact, sending money to al-Qaeda for textbooks and medicines and food and childcare is probably illegal in Australia, as it should be, because it will inevitably increase their ability to buy explosives and box-cutters."

"The bottom line," says the figure involved in the Beijing?Canberra negotiations, "is that China has enough uranium supplies for power or weapons, but not both, to last until 2020."

The talks between Australia and China will continue in the weeks ahead, but our insider describes the deal as a fait accompli.

All of which might give Sting something new (or should that be old?) to sing about.