Remarks by U.S. Permanent Representative to the United Nations and International Atomic Energy Agency Gregory L. Schulte on U.S. Nuclear Nonproliferation Policy and the Challenge of Iran

April 25, 2006

In a world where terror and extremism have global reach, all countries have a stake in keeping the most dangerous of weapons out of the hands of rogue states and terrorists. The National Security Strategy recently released by President Bush describes U.S. strategy to prevent such proliferation.

That strategy focuses on controlling fissile material -- the essential ingredient for nuclear weapons -- with two priority objectives: first, to keep states from acquiring the capability to produce fissile material suitable for making nuclear weapons; and second, to deter, interdict, or prevent any transfer of fissile material to rogue states or terrorists. The first objective requires closing a loophole in the Non-Proliferation Treaty. This loophole -- exploited most recently by Iran -- permits dishonest regimes to develop the capability to produce fissile material for nuclear weapons under the cover of a civilian program. To close this loophole, we have proposed that leading nuclear exporters create a safe, orderly system that spreads nuclear energy without spreading nuclear weapons. Under this system, all participating states would have reliable access at reasonable cost to fuel for civil power reactors.

In return, those states would remain transparent and renounce the enrichment and reprocessing capabilities that can produce fissile material for nuclear weapons. In the near term, we are working with other fuel provider states and the International Atomic Energy Agency to establish a multilateral system of fuel assurances. The Department of Energy has set aside a surplus of highly-enriched uranium that can be blended down to back up these assurances.

In the longer term, we have proposed a Global Nuclear Energy Partnership. This initiative, recently briefed to the IAEA, foresees new international partnerships and advances in reactor and recycling technology making nuclear power more proliferation-resistant.

The second objective -- preventing transfer of fissile material to rogue states and terrorists -- requires us to address the danger posed by inadequately protected nuclear and radiological materials worldwide. The Global Threat Reduction Initiative, undertaken by the United States with the IAEA and countries across the world, aims to locate, track, and reduce existing stockpiles of fissile and other radiological material.

Last week under GTRI, the United States, Russia, Uzbekistan, Kazakhstan, and the IAEA cooperated in moving spent nuclear fuel from a former Soviet research reactor to safekeeping in Russia. This spent fuel was enough to produce two nuclear weapons. But there is plenty more weapons-grade material to be collected.

The IAEA reports that, of the 274 research reactors operating in 57 countries, roughly half use highly-enriched uranium. We are working through GTRI to convert these reactors to low-enriched uranium. We are also supporting an effort by Norway to secure international agreement to minimize use of high-enriched uranium in civil applications. The Challenge of Iran We are working with Europe and countries across the world to strengthen the global nonproliferation regime and the capabilities of the IAEA. But the nonproliferation regime and the credibility of the IAEA are increasingly threatened by the leaders in Iran, as they disregard international obligations and defy international concerns. Iran's determined pursuit of nuclear weapons capabilities poses a range of threats to the region and the world.

A nuclear-armed Iran could embolden its leaders to advance their ambitions throughout the region, whether with the conventional forces they are building or the terrorists they support. A nuclear-armed Iran could pose an even greater threat to Middle East peace -- not to mention the very existence of Israel. A nuclear-armed Iran could provide the fuse for further proliferation, causing other countries to re-evaluate their nonproliferation commitments.

A nuclear-armed Iran, with its many links to terrorists and extremists, could increase the risk of nuclear terrorism, whether by design or diversion. A nuclear-armed Iran would consolidate the chokehold of the mullahs, making democracy and freedom a more distant prospect for the people of Iran.

The IAEA has been seized with the challenge posed by Iran and since 2003 has been rigorously investigating concerns about Iran's nuclear activities. Last September, after two years of investigation, the IAEA made two important findings: first, that Iran has violated its safeguards obligations under the Nuclear Non-Proliferation Treaty; and second, that Iran has lost international trust in the peaceful nature of its nuclear program.

In February, after giving Iran multiple opportunities to address international concerns, the Agency's Board reported these findings to the UN Security Council. Last month, the UN Security Council issued a Presidential Statement that called on Iran to undertake a set of confidence-building measures deemed necessary by the IAEA Board.

The Security Council also asked Dr. ElBaradei, the IAEA Director General, to report on Iran's response by the end of this week.

First, the Director General is to report onwhether Iran has met the Board's call to re-establish full and sustained suspensionof all enrichment-related and reprocessing activities. These activities have generated much international concern and make no sense in the context of Iran's limited nuclear power program. Have Iran's leaders complied with the UN Security Council's request? No.

Instead, two weeks ago, just before Dr. ElBaradei's recent visit to Iran, President Ahmadinejad defiantly announced that Iran had successfully enriched uranium in a 164-centrifuge cascade at Natanz. The head of Iran's Atomic Energy Organization also announced plans to begin operating a complex of 3,000 centrifuges for uranium enrichment by March of next year. According to estimates by the International Institute for Strategic Studies, such a complex, once successfully operating, could produce the material for a nuclear weapon in less than a year.

At this point, any token offers of cooperation or short-term technical "pauses", made by Iran as the Director General completes his report, cannot offset Iran's blatant defiance of the Board's call for full and sustained suspension of enrichment activities.

Second, the Director General is to report on whether Iran has met the Board's call to reconsider construction of a heavy water research reactor at Arak. This large project has no convincing civilian purpose. However the planned reactor's technical characteristicsare well suited for production of weapons-grade plutonium.

Have Iran's leaders complied with the UN Security Council's request? No. In fact, in his February report, the Director General said that civil engineering work was still ongoing at Arak. Third, the Director General is to report on whether Iran has met the Board's call to implement the Additional Protocol. This protocol is designed to help the Agencydetect covert programs by giving its inspectors access to additional sites and information.

Have Iran's leaders complied with the UN Security Council's request? No.

In addition to breaking IAEA seals-- first to convert uranium and now to enrich it -- Iran has limited the authority of IAEA inspectors to visit only those facilities where declared nuclear material is located, including where much of this activity is taking place. This prevents the inspectors from going to many of the locations of concern to which they had previously had access, including centrifuge component workshops. Fourth, the Director General is to report on whether Iran has met the Board's call to implement the transparency measures he has repeatedly requested. These include access to individuals, documents, equipment, and facilities needed to resolve the serious concerns of the IAEA Board.

Again, have Iran's leaders complied with the UN Security Council's request? No.

As Dr. ElBaradei reported in February,after three years of intensive verification efforts, the IAEA is still unable to verify the peaceful nature of Iran's nuclear program. Transparency, in the Director General's words, is "indispensable".... and "overdue." Indeed, the more the IAEA investigates, the more questions it uncovers.

Why does Iran possess -- and refuse to turn over -- a document on procedures for fabricating nuclear weapons components? Why does Iran refuse to explain apparent connections between the undeclared "Green Salt" uranium conversion project, tests of high explosives, and the design of a missile re-entry vehicle?

Why does Iran refuse to provide a satisfactory explanation for the status of the P-2 centrifuge program and the history of cooperation received from AQ Khan?

This last question is of particular importance now that President Ahmadinejad has publicly proclaimed that Iran is researching and testing this type of centrifuge. As Iran's President acknowledges, the P-2 would enrich uranium much faster than the P-1 centrifuges now being monitored by IAEA inspectors. And, undeclared work on P-2 centrifuges would be further evidence that Iran is still hiding sensitive aspects of its enrichment program. In short, today's report card on Iran's nuclear activities would be anything but encouraging.

Instead, it would reflect what is, in our judgment, a deliberate, step-by-step process, directed by Iran's highest leadership, to acquire the technology, material, and know-how to build nuclear weapons. And while the threat may not be imminent, it cannot be ignored. We cannot allow this dangerous regime, one which denies the Holocaust, one which threatens death to whole nations, to gain access to the most deadly of weapons.

Our goal remains a diplomatic solution, one in which Iran's leaders set aside their ambitions for nuclear weapons capabilities and grasp the diplomatic opportunities offered by Europe and Russia with U.S. support. But inducing the current leadership to make this choice will clearly require tough and sustained diplomacy, including action by the Security Council.

By bringing to bear the weight of the Security Council, our aim is: to reinforce the authority of the IAEA; and to demonstrate to Iran's leaders, that by failing to heed international concern, they are isolating their country and risking international sanction.

For diplomacy to succeed, we must be prepared to use the full range of diplomatic tools available to the Security Council.

For diplomacy to succeed, individual countries, and the European Union as a whole, must apply leverage.

And for diplomacy to succeed, Europe and the United States must work together, with unity and resolve, in tackling this common challenge.