The IAEA Board of Governors has approved the Technical Cooperation Program for 2007-2008 with one exception: Iran's request for assistance in building a heavy water reactor at Arak.

The Arak project was not deferred.

It was not put on hold.

It was removed entirely from the IAEA program.

The removal of Arak -- an action taken by consensus -- reflects the Board's continued concern about the nature of Iran's nuclear program and the intentions of its leadership.

Heavy water reactors are well suited to producing significant quantities of plutonium -- a key ingredient in building nuclear weapons.

If Iran's leaders are serious about peaceful uses, they should take up the offer from Europe to help build a light-water reactor, the industry standard used across the world to produce medical isotopes and conduct peaceful research.

Iran is suffering from what Mr. ElBaradei has called a confidence deficit.

Yesterday a colleague from a developing country told me that he had never seen Iran so isolated in the Non-Aligned Movement.

Today's decision to remove Arak from the Technical Cooperation Program reinforces the Board's repeated calls on Iran to reconsider this troubling project.

The United States strongly supports IAEA efforts to help member states make peaceful use of nuclear technologies.

But neither we nor the Board are prepared to help countries build nuclear bombs.

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Later today, the Board will consider the Director General's latest report on the many outstanding questions and concerns about Iran's nuclear program.

The report is brief: brief because Iran is failing to cooperate with the IAEA; brief because Iran is failing to address the Board's continuing concerns about its nuclear program.

Last April Iran promised a timetable for cooperation.

It has delivered neither a timetable nor cooperation.

Instead, as the Director General reports, Iran repeatedly fails to meet specific requests for information, sampling, and access to individuals and facilities.

Iran is not only stonewalling IAEA inspectors.

The Director General's report tells us that Iran's leaders are also pressing forward defiantly on uranium enrichment and plutonium production - the two paths to a nuclear bomb.

Our goal is to achieve a diplomatic solution, one in which the leaders of Iran give up their pursuit of nuclear weapons and take credible steps to gain international trust.

In June 2006, the EU3, United States, Russia and China made generous offer, one with significant technological, economic, and security benefits for Iran. Much to our regret, Iran's leaders have yet to comply with Security Council Resolution 1696 and demonstrate a serious willingness to take advantage of this offer.

In Resolution 1696, the Security Council stated its intention to pursue measures under Article 41 if Iran failed to comply with that resolution.

The time has now come to back international diplomacy with international sanctions.

Meaningful measures are needed to convince Iran's leaders make the right choice

- a choice for constructive engagement over continued confrontation;

- a choice for serious negotiation over repeated noncompliance;

- a choice for peaceful nuclear benefit over the two paths to a bomb.