Every year brings new challenges and opportunities, and the past twelve months at the IAEA have been no exception. The outlook for nuclear power is evolving, with increasing attention to its benefits as an environmentally clean source of electricity, but with concerns remaining related to waste disposal, safety and security. Nuclear applications in human health, agriculture and other fields are increasingly contributing to global sustainable development initiatives, and the Agency has redoubled its efforts to support these initiatives by improving the efficiency and extending the reach of its technical cooperation programme. Global cooperation in matters of safety and security has resulted in sustained improvements overall, but there is still much to be done. In the area of verification, the Agency's activities remain at the centre of efforts to curb nuclear proliferation, and we have continued to prove our ability to conduct objective and credible safeguards - but the international community still faces a number of difficult challenges, and has intensified its focus on how to strengthen the nuclear non-proliferation regime.
Today I welcome this opportunity to review with you some of the Agency´s work in each of these areas.
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Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran
The IAEA has continued to devote considerable attention to the implementation of safeguards in the Islamic Republic of Iran, and the IAEA Board of Governors has adopted several resolutions relevant to Iran´s past undeclared nuclear programme and its failure over an extended period of time to meet many of its obligations under its safeguards agreement. The Board has urged Iran, inter alia, to cooperate fully with the Agency in the verification process.
Since February 2003, when the IAEA started its verification of IranÂ´s undeclared programme, the Agency has made steady progress in understanding its nature and extent. Last December, Iran signed an additional protocol and has been acting as if the protocol were in force, pending its ratification. Iran´s earlier interactions with the Agency were regrettably marked by the provision of information that was at times changing, contradictory, and slow in coming, a situation that led to repeated expressions of concern by the Board. Iran´s cooperation since that time, however, has improved appreciably. IAEA inspectors have been provided access to requested locations, and Iran has provided information requested by the Agency - although in some cases Iran´s response has continued to be slow.
As a result of the Agency´s investigations, some issues have reached the point where any further follow-up needed will be carried out as part of routine safeguards implementation. One issue remains central to understanding Iran´s nuclear programme: namely, the extent and nature of Iran´s uranium enrichment activities. Additional investigation is still ongoing, and I expect to be able to provide a comprehensive report on progress to our Board of Governors later this month.
As of November of last year, the IAEA Board of Governors has also asked the Agency to monitor Iran´s voluntary suspension of enrichment related and reprocessing activities. However, Iran has reversed some of the suspension measures initially undertaken in November 2003, and the Board has called on Iran again to suspend all enrichment-related and reprocessing activities as a confidence building measure. I have continued to stress to Iran that, in light of serious international concerns surrounding its nuclear programme, it should do its utmost to build confidence through these voluntary measures. I have also asked Iran to pursue a policy of maximum transparency, so that we can bring the outstanding issues to resolution and, over time, provide the required assurance to the international community. This is clearly in the interest of both Iran and the international community and should, in my view, lead to a dialogue among all interested parties with a view to reaching a comprehensive settlement of all the underlying issues.
Implementation of United Nations Security Council Resolutions Relating to Iraq
The IAEA's mandate in Iraq under various Security Council resolutions still remains in effect. As I reported to you last year, at the time the Agency was asked to cease its Security Council verification activities in Iraq in March 2003, we had found no evidence of the revival of nuclear activities prohibited under relevant Security Council resolutions. Naturally, the international community is reassured that these findings have since been validated.
Security Council resolution 1546, inter alia, reaffirmed the intention of the Council to revisit the mandate of the Agency in Iraq. I hope that the Council will soon provide guidance on the future of this mandate. It is clearly important to bring the whole question of weapons of mass destruction in Iraq to closure as early as possible, and for the Agency to resume the necessary verification and monitoring activities in Iraq as soon as the security situation permits - particularly in view of the dual-use items that have been under IAEA custody in Iraq that would be susceptible to misuse.
Application of Agency Safeguards in the Middle East
Pursuant to the mandate given to me by the IAEA General Conference, I have continued my consultations with the States of the Middle East region on the application of full scope safeguards to all nuclear activities in the Middle East, and on the development of model agreements. Once again, I regret to report that I have not been in a position to make progress on these fronts.
The General Conference has also asked me to organize a forum on the relevance of the experience of other regions with existing nuclear-weapon-free zones - including confidence building and verification measures - for establishing such a zone in the region of the Middle East. Based on my consultations with States of the region, including during my recent visit to Israel, I intend to organize such a forum early next year, and further consultations are in progress towards that end. I earnestly hope for this forum to be the beginning of a much needed dialogue among States of the region on a security structure that would undergird efforts to reach a comprehensive settlement in the region.
Strengthening Nuclear Non-Proliferation
The recent experience of the IAEA in verifying undeclared nuclear programmes has yielded a number of important lessons, which are worth noting in this context. Perhaps the most important lesson is that verification and diplomacy, used in conjunction, can be effective. When inspections are accompanied by adequate authority, aided by all available information, backed by a credible compliance mechanism, and supported by international consensus, the system works. The Iraq experience demonstrated that inspections - while requiring time and patience - can be effective even when the country under inspection is providing less than active cooperation.
Perhaps the most disturbing lesson to emerge from our work in Iran and Libya is the existence of an extensive illicit market for the supply of nuclear items, which clearly thrived on demand. The relative ease with which a multinational illicit network could be set up and operated demonstrates clearly the inadequacy of the present export control system, which relies on informal arrangements that are not only non-binding, but also do not include many countries with growing industrial capacity, and do not provide for any systematic sharing of information with the IAEA.
A related lesson involves the accessibility of nuclear technology. The technical barriers to mastering the essential steps of uranium enrichment - and to designing weapons - have eroded over time, which inevitably leads to the conclusion that the control of technology, in and of itself, is not a sufficient barrier against further proliferation. This also leads to the important conclusion that ways and means should be found to better control the sensitive parts of the fuel cycle - namely, the production of enriched uranium and the reprocessing of plutonium.
The concept of multilateral control or oversight over proliferation sensitive parts of the nuclear fuel cycle has been the subject of many studies and initiatives over the years. Recent non-proliferation and security challenges make it important and appropriate that we revisit this subject. Several months ago, I appointed a group of senior experts to look into various options for multilateral control. The group plans to submit a report next March on the results of its study.
In addition to the various components of the nuclear non-proliferation regime that, as I mentioned, need strengthening - including better control over sensitive aspects of the nuclear fuel cycle, increased efforts to secure and protect nuclear material and facilities, a more inclusive and integrated export control system, and the need for all States to conclude additional protocols - I should stress the importance of working collectively to address the sense of insecurity and instability that persists in many countries and regions. It is instructive that nearly all nuclear proliferation concerns are in areas of longstanding conflict and instability.
As we proceed, it is important, in my view, to recognize both the value and the limitations of the IAEA´s verification role. While the Agency can work effectively to bring to closure questions of compliance with legal and technical requirements, the long term value of these efforts can only be realized to the extent that they are supported and reinforced by other components of the non-proliferation regime, such as export controls and compliance mechanisms. Equally and perhaps more importantly, these efforts should be followed by the necessary political dialogue among concerned States, to address underlying issues of insecurity, and to build confidence and trust.
This overview of the past year highlights achievements and challenges in all areas of Agency activity - and reflects the dynamic nature of our programme in anticipating and responding to change. Whether a specific activity contributes to strengthening the nuclear non-proliferation regime, enhancing the transfer and application of nuclear technologies, or ensuring safety and security in their use, our commitment is always to respond to the needs and priorities of our Member States.
I would like to conclude by expressing my continuing gratitude to the Government of Austria, which has now served for over four decades as a most gracious and welcoming host to the IAEA.