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95–191 PDF 2004

S. Hrg. 108–589

INTERNATIONAL SMUGGLING NETWORKS:

WEAPONS OF MASS DESTRUCTION

COUNTERPROLIFERATION INITIATIVES

HEARING

BEFORE THE

FINANCIAL MANAGEMENT, THE BUDGET, AND 

INTERNATIONAL SECURITY SUBCOMMITTEE

OF THE

COMMITTEE ON 

GOVERNMENTAL AFFAIRS 

UNITED STATES SENATE

ONE HUNDRED EIGHTH CONGRESS

SECOND SESSION

JUNE 23, 2004

Printed for the use of the Committee on Governmental Affairs

(

(II)

COMMITTEE ON GOVERNMENTAL AFFAIRS 

SUSAN M. COLLINS, Maine, Chairman 

TED STEVENS, Alaska 

GEORGE V. VOINOVICH, Ohio 

NORM COLEMAN, Minnesota 

ARLEN SPECTER, Pennsylvania 

ROBERT F. BENNETT, Utah 

PETER G. FITZGERALD, Illinois 

JOHN E. SUNUNU, New Hampshire 

RICHARD C. SHELBY, Alabama 

JOSEPH I. LIEBERMAN, Connecticut 

CARL LEVIN, Michigan 

DANIEL K. AKAKA, Hawaii 

RICHARD J. DURBIN, Illinois 

THOMAS R. CARPER, Delaware 

MARK DAYTON, Minnesota 

FRANK LAUTENBERG, New Jersey 

MARK PRYOR, Arkansas

MICHAEL D. BOPP, Staff Director and Chief Counsel 

JOYCE A. RECHTSCHAFFEN, Minority Staff Director and Counsel 

AMY B. NEWHOUSE, Chief Clerk

FINANCIAL MANAGEMENT, THE BUDGET, AND INTERNATIONAL 

SECURITY SUBCOMMITTEE 

PETER G. FITZGERALD, Illinois, Chairman 

TED STEVENS, Alaska 

GEORGE V. VOINOVICH, Ohio 

ARLEN SPECTER, Pennsylvania 

ROBERT F. BENNETT, Utah 

JOHN E. SUNUNU, New Hampshire 

RICHARD C. SHELBY, Alabama 

DANIEL K. AKAKA, Hawaii 

CARL LEVIN, Michigan 

THOMAS R. CARPER, Delaware 

MARK DAYTON, Minnesota 

FRANK LAUTENBERG, New Jersey 

MARK PRYOR, Arkansas

MICHAEL J. RUSSELL, Staff Director 

RICHARD J. KESSLER, Minority Staff Director 

NANCI E. LANGLEY, Minority Deputy Staff Director 

TARA E. BAIRD, Chief Clerk 

(III)

C O N T E N T S 

Opening statements: Page 

Senator Fitzgerald ............................................................................................ 1

Senator Akaka .................................................................................................. 4

Senator Lautenberg .......................................................................................... 10

WITNESSES 

WEDNESDAY, JUNE 23, 2004

Mark T. Fitzpatrick, Acting Deputy Assistant Secretary for Nonproliferation 

Controls, U.S. Department of State .................................................................... 6

Hon. Peter Lichtenbaum, Assistant Secretary of Commerce for Export Administration, U.S. Department of Commerce ........................................................... 8

David Albright, President and Founder, Institute for Science and International Security .................................................................................................. 19

Michael Moodie, President, Chemical and Biological Arms Control Institute ... 22

Leonard S. Spector, Deputy Director, Center for Nonproliferation Studies, 

Monterey Institute of International Studies ...................................................... 24

Baker Spring, F.M. Kirby Research Fellow in National Security Policy, The 

Heritage Foundation ............................................................................................ 26

ALPHABETICAL LIST OF WITNESSES

Albright, David: 

Testimony .......................................................................................................... 19

Prepared statement .......................................................................................... 45

Fitzpatrick, Mark T.: 

Testimony .......................................................................................................... 6

Prepared statement .......................................................................................... 31

Lichtenbaum, Hon. Peter: 

Testimony .......................................................................................................... 8

Prepared statement .......................................................................................... 36

Moodie, Michael: 

Testimony .......................................................................................................... 22

Prepared statement .......................................................................................... 52

Spector, Leonard S.: 

Testimony .......................................................................................................... 24

Prepared statement with an attachment ....................................................... 62

Spring, Baker: 

Testimony .......................................................................................................... 26

Prepared statement with an attachment ....................................................... 86

APPENDIX 

Chart submitted by Senator Akaka ....................................................................... 107

Questions and Responses for the Record from: 

Mr. Fitzpatrick .................................................................................................. 108

Mr. Lichtenbaum .............................................................................................. 136

Mr. Albright ...................................................................................................... 145

Mr. Spector ........................................................................................................ 151

Mr. Spring with an attachment ...................................................................... 158

(1)

INTERNATIONAL SMUGGLING NETWORKS: 

WEAPONS OF MASS DESTRUCTION 

COUNTERPROLIFERATION INITIATIVES 

WEDNESDAY, JUNE 23, 2004

U.S. SENATE,

SUBCOMMITTEE ON FINANCIAL MANAGEMENT,

THE BUDGET, AND INTERNATIONAL SECURITY,

OF THE COMMITTEE ON GOVERNMENTAL AFFAIRS, 

Washington, DC. 

The Subcommittee met, pursuant to notice, at 4:24 p.m., in room 

SD–342 Dirksen Senate Office Building, Hon. Peter G. Fitzgerald, 

Chairman of the Subcommittee, presiding. 

Present: Senators Fitzgerald, Akaka, and Lautenberg. 

OPENING STATEMENT OF SENATOR FITZGERALD 

Senator FITZGERALD. This meeting will come to order. I apologize 

for the delay in today’s hearing. I think it was supposed to start 

at 2:30 p.m., and now it is almost 4:30 p.m. We got interrupted by 

a series of votes, and I appreciate our witnesses’ patience. I was 

glad to see you were still here when I arrived. 

I would like to welcome the Subcommittee’s Ranking Member, 

Senator Akaka, who is one of the leaders in the Senate on nonproliferation issues. I also would like to welcome our distinguished 

witnesses from whom we will hear shortly. 

Today we are conducting an oversight hearing to examine the 

clandestine trade of weapons of mass destruction and the U.S. programs and initiatives to counter this dangerous international security threat. 

Beginning late last year, we have seen a series of alarming discoveries regarding how weapons of mass destruction—nuclear, 

chemical, biologica,l and radiological—may be spread around the 

world. 

An editorial in the Chicago Tribune of February 1, 2004, entitled 

‘‘A Nuclear Weapons Wal-Mart,’’ described the situation this way, 

‘‘For those who track nuclear weapons across the globe, developments over the last weeks have heads spinning like the special centrifuges that enrich uranium for nuclear bombs. That is, very fast.’’

What is particularly alarming about these discoveries is the apparent ease with which nations or terrorists wishing to do us harm 

may obtain these lethal materials. The editorial described the nuclear smuggling network that was established and directed by Pakistani nuclear scientist, Abdul Qadeer Khan, to transport nuclear 

weapons components and related materials around the globe. As 

2

the editorial mentions, upon learning of Khan’s dealings, the head 

of the International Atomic Energy Agency, Mohamed ElBaradei, 

proclaimed that a ‘‘Wal-Mart of private sector proliferation’’ has existed for over a decade. The editorial concluded with this call on 

government leaders in the U.S. and abroad: ‘‘It’s not likely that any 

single initiative will completely shut down the nuclear Wal-Mart. 

But by cooperating on a global scale, law enforcement agents can 

make it a lot harder for nuclear black marketeers to do business.’’

This hearing builds on a hearing we conducted last year to examine North Korea’s role in drug trafficking, counterfeiting, and 

weapons proliferation. During the hearing we heard disturbing testimony from our witnesses, including two North Korean defectors, 

about that country’s weapons program and its export of dangerous 

weapons. This past February, Abdul Qadeer Khan, who is considered to be the father of Pakistan’s nuclear weapons program, 

signed a detailed confession admitting to the sale and transfer of 

materials, designs, and technologies to produce fuel for nuclear 

weapons. The Khan trade network may be one of the most complex 

and successful efforts to evade international controls to prevent the 

spread of nuclear weapons. 

Abdul Qadeer Khan directed the trade network in conjunction 

with a small group of business associates. Together they coordinated the manufacture and shipment of nuclear components from 

a number of countries to Libya, North Korea, Iran, and possibly 

others. While the majority of the shipments were components for 

gas centrifuges that are used to enrich uranium for use in a nuclear weapon, the network also supplied uranium and nuclear 

weapons designs to Libya. 

The Khan network is disturbing for many reasons, most importantly for the opportunity it may have afforded rogue nations or 

terrorists to circumvent international controls to acquire not only 

materials, but also the technology, designs, and expertise necessary 

to build a weapon of mass destruction. The Khan network may already have helped terrorists in this regard. For example, Osama 

bin Laden has purportedly called it a ‘‘duty’’ for al Qaeda to develop a nuclear bomb. 

The Associated Press reported in March 2004 that al Qaeda leadership claims to have bought ‘‘ready-made nuclear weapons on the 

black market in Central Asia.’’ While much progress has been 

made in detecting the extent of the Khan network’s operations, 

many questions remain unanswered. The Washington Post reported 

on May 29, 2004 that investigators had been unable to account for 

some sensitive parts Libya ordered for use in the construction of 

a uranium enrichment plant. The failure of these parts to arrive 

in Libya raises the possibility that the shipments may have been 

diverted, or that they were being manufactured by unknown suppliers that have not yet been revealed. 

According to the same news reports, investigators believe that 

not only have some suppliers of the network not been identified, 

but perhaps some customers as well. 

I look forward to hearing from our witnesses regarding the 

progress in dismantling the Khan network, as well as the implications this network has for U.S. and international efforts to stop 

black market proliferation. The threats posed by the proliferation 

3

of weapons of mass destruction and their delivery systems is increasingly acknowledged around the world to be a growing threat. 

In response, on May 31, 2002, President Bush announced the Proliferation Security Initiative (PSI), which seeks to combine the use 

of existing national and international legal authorities with enhanced intelligence sharing and multilateral coordination to improve the interdiction of WMD and WMD-related materials transported around the world. The goal of the PSI is to stop weapons 

shipments and deter state or non-state actors from engaging in the 

weapons trade. 

Thus far, 14 nations including Australia, France, Japan, Russia, 

the United Kingdom, Germany, Italy, and Singapore, among others, have joined the United States as core members of the Initiative, and over 60 nations have signaled their willingness to cooperate with the PSI in its interdiction activities. 

Additionally, Panama and Liberia, the world’s first and second 

largest shipping registries, have signed boarding agreements indicating their willingness to permit ships carrying their flags to be 

stopped for inspection. The cooperation of these two nations in conjunction with the core member states will allow approximately 50 

percent of the world’s commercial shipping fleet to be subject to 

boarding, search, and seizure. 

As we will hear from our witnesses, the PSI is described as an 

activity rather than an organization. As I understand it, the administration believes that this approach, similar to a coalition of 

the willing, will prove more responsive and adaptable to changing 

threats than the alternative which would be the creation of a formal multilateral structure. It is believed that a formal organization 

could become bogged down in competing priorities and the time 

consuming nature of a bureaucracy. 

The PSI recently celebrated its one-year anniversary and was 

high on the agenda at the recent G–8 Summit in Sea Island, Georgia. Some outside experts, however, have raised concerns with the 

approach of the PSI, specifically the time-consuming nature of its 

activities and its overall effectiveness. We look forward to hearing 

the views of our witnesses on these issues. 

We are privileged today to have senior officials from the Departments of Commerce and State who will address the role of export 

controls and nonproliferation policy, and the work of the PSI and 

its future plans, respectively. I look forward to hearing from them 

on how these aspects of U.S. policy help prevent the spread of 

WMD and WMD-related materials throughout the world. 

We also have with us today a distinguished panel of independent 

experts in proliferation policy. I look forward to hearing their evaluations of current counterproliferation initiatives. I especially look 

forward to hearing their thoughts regarding the threat posed by 

WMD smuggling networks, as well as how efforts like the PSI may 

help detect and deter future networks from forming. 

Before I introduce our witnesses, I would like to recognize the 

Subcommittee’s Ranking Member, Senator Akaka, who may wish 

to make an opening statement. Senator Akaka. 

4

1The chart referred to submitted by Senator Akaka appears in the Appendix on page 108. 

OPENING STATEMENT OF SENATOR AKAKA 

Senator AKAKA. Chairman Fitzgerald, thank you very much for 

holding this hearing. It is a great tradition of this Subcommittee 

and the full Committee to focus on international security issues. 

This hearing is a very worthwhile contribution to the Subcommittee’s continued efforts to improve the government’s ability to address threats to our Nation. 

It was more than a year ago that President Bush announced the 

Proliferation Security Initiative, or PSI. Since then, there have 

been major developments in counterproliferation, most notably the 

decision by Libya to end its weapons of mass destruction programs. 

The Libya case brought into the open what was once only whispered about in the corridors of the intelligence community. That is 

the black market in WMD materials. 

Although much has been written about the A.Q. Khan network 

operating out of Pakistan, with tentacles in many countries, we 

still have not fully unraveled this network, and there are other people directing similar operations. Arresting Khan did not destroy 

this ‘‘network.’’ His was only one of many now facilitating the 

transfer of WMD-related materials. Never before has there been so 

much demand by so many for WMD materials. As an illustration 

of these extensive networks for nuclear, chemical, and biological 

weapons, I wish to point out a chart on either side of this room, 

prepared by my staff, based on published reports.1

What these charts illustrate is that there is a web of relationships, some private, some governmental, that tie illicit activities by 

either rogue states or terrorist groups to legitimate companies and 

countries. To focus on stopping activities between rogue countries 

and terrorist groups would be to place a barrier only partway 

across the flood of destructive weapons. We need to broaden and 

intensify our efforts because it is only a matter of time before hundreds of thousands of people are killed in an attack by a weapon 

of mass destruction, nuclear, biological, or chemical. Yet, rather 

than aggressively doing all we can to prevent this, the United 

States, sends at best, mixed messages. 

For example, even though the Central Intelligence Agency has 

identified a bomb exploded by terrorists as a more likely threat 

than a missile launched by a rogue state, we are spending billions 

of dollars to develop a national missile defense system that may 

not work, and against a threat that does not yet exist. 

For example, even though countless reports have identified radioactive material in the former Soviet Union as providing the most 

ready source of material to terrorists, funding requests for programs to secure Russian nuclear materials and eliminate weapons 

grade plutonium production have decreased. 

Even as we decry the development of nuclear weapons by other 

states, this administration is investing millions in developing a 

new earth-penetrating nuclear weapon and millions in making new 

nuclear weapons easier to test. 

What we need to do is clear. A simple six-step program would 

have a tremendous impact: (1) Accelerate efforts of control at radioactive materials worldwide; (2) Accelerate negotiations with the 

5

Russians to reduce the number of nuclear warheads and the number of weapons on alert status; (3) Set an example by eliminating 

spending on new nuclear weapons; (4) Ratify the Comprehensive 

Nuclear Test Ban Treaty; (5) Negotiate a verifiable fissile material 

cut-off treaty; and (6) Develop and strengthen existing export control systems. 

These are only a few steps of a broader agenda, but they are critical components. What is so disappointing is how few of these obvious measures have been adopted. 

I am pleased that we have with us today such distinguished witnesses from the administration and the public to discuss these important issues, and I welcome them to the Subcommittee. Thank 

you, Mr. Chairman. 

Senator FITZGERALD. Thank you, Senator Akaka. 

Our first witness is the Hon. Peter Lichtenbaum, Assistant Secretary of Commerce for Export Administration at the U.S. Department of Commerce. In his role at the Department of Commerce, 

Mr. Lichtenbaum is responsible for policies regarding controls on 

the export of dual-use items for reasons including national security, 

nonproliferation, and foreign policy. He also manages the Bureau 

of Industry and Security’s participation in multilateral export control regimes and chairs the Inter-Agency Advisory Committee on 

Export Policy. Prior to his work at the Commerce Department, Mr. 

Lichtenbaum was with the law firm of Steptoe and Johnson, where 

he practiced in the firm’s international group. He also served in the 

Treasury Department, where he worked on international law and 

economic policy issues. 

Our second witness is Mark Fitzpatrick, who is Acting Deputy 

Assistant Secretary for Nonproliferation Controls at the U.S. Department of State. As Acting Deputy Assistant Secretary, Mr. 

Fitzpatrick oversees programs regarding countries potentially involved in proliferation, interdiction and sanctions cases, cooperative 

efforts on export controls and border monitoring, as well as other 

nonproliferation assistance programs. Prior to serving in his current position, Mr. Fitzpatrick served as Director of the Office of Regional Affairs in the Nonproliferation Bureau. The Nonproliferation 

Bureau compiles and coordinates policy on regional issues involving 

weapons of mass destruction in specific areas such as Iran, North 

Korea, and Libya. 

Again, I would like to thank you both for being here. I would like 

to especially thank you for your patience, given our votes this afternoon. In the interest of time, we will include your full statements 

in the record, and we would ask that you limit your opening remarks to 5 minutes if possible. I will let either of you begin as you 

choose, whoever wants to go first. 

Mr. LICHTENBAUM. Thank you, Mr. Chairman. 

Mr. Chairman, Senator Akaka, and Members of the Subcommittee, we appreciate the opportunity to testify here today. Mr. 

Chairman, as you said, we are here to discuss a very important 

topic, the U.S. efforts to address the threat posed by international 

networks who are seeking weapons of mass destruction. 

With your permission, Mr. Chairman, I would like to defer to Mr. 

Fitzpatrick from the State Department to begin our discussion of 

the administration’s counterproliferation initiatives and I will then 

6

1The prepared statement of Mr. Fitzpatrick appears in the Appendix on page 31. 

discuss the role of export controls in promoting a nonproliferation 

policy. 

Senator FITZGERALD. That is fine. Mr. Fitzpatrick. 

TESTIMONY OF MARK T. FITZPATRICK,1 ACTING DEPUTY ASSISTANT SECRETARY OF STATE, BUREAU OF NONPROLIFERATION 

Mr. FITZPATRICK. Thank you, Peter. 

Mr. Chairman, Senator Akaka, thank you for the opportunity to 

speak to you today about the status of efforts to prevent the proliferation of weapons of mass destruction, and in particular, the 

Proliferation Security Initiative. As you said, I have a prepared 

statement that has been submitted for the record, so I will confine 

my oral remarks just to some of the main points in that statement. 

The proliferation of weapons of mass destruction remains a serious challenge to our national security. The next steps in the administration’s nonproliferation agenda were clearly established by 

President Bush’s February 11 speech at the National Defense University, which also highlighted the reality that the path to proliferation does not always lie in a straight line between supplier 

and recipient. 

We continue to learn about black market operatives who deal in 

equipment and expertise related to weapons of mass destruction. 

The extensive network operated by Pakistani nuclear scientist, 

A.Q. Khan, and now being shut down by U.S. and UK led diplomatic and intelligence efforts is the starkest example of the problem—a shadowy black arms market in which the most dangerous 

of weapons technology, parts, and materials moved across four continents. Its existence alerts us to the dangers of whether there 

could be other networks still in operation. Moreover, the threat of 

onward proliferation is not limited to non-state actors such as A.Q. 

Khan, but extends to proliferant states cooperating between themselves. This compounds the danger. 

Against this backdrop the United States has taken a number of 

efforts to enhance our ability to detect and prevent illicit procurement or shipment of WMD missiles or related technologies. These 

efforts include strengthening multilateral regimes and treaties, enhancing export controls and enforcement measures, preventing nuclear smuggling, and taking decisive action against WMD missile 

and advanced conventional weapon procurements. In the interest of 

time I will not elaborate on these efforts orally, but note that I address them in detail in my prepared remarks. 

I would like to focus though on the Proliferation Security Initiative, PSI, which was announced by President Bush a year ago. The 

PSI, as you said, Mr. Chairman, is a set of activities, not an organization, activities that provides opportunities for groups of states to 

work together to address operational and information requirements 

for effective action against proliferators. Its emergence reflects the 

reality that even as we continue to support and strengthen existing 

nonproliferation treaties and regimes, proliferators, and those who 

facilitate procurement of deadly capabilities, are circumventing existing laws, treaties, and controls. 

7

The PSI was envisioned as a flexible instrument. Its statement 

of interdiction principles published last September serves as the 

blueprint for PSI activities. These principles make clear that all 

PSI activities are consistent with national legal authorities and relevant international law and frameworks. 

As the number of states participating in and supporting the PSI 

grows, we are focusing on concrete, practical activities to establish 

states’ understanding of and capabilities for what will be involved 

in interdicting cargoes. States are becoming involved in PSI activities in a variety of ways. Some are participating in informational 

meetings. Others are participating in interdiction training exercises, and still others are stepping forward with new ideas to advance the Proliferation Security Initiative. 

For example, in August, Denmark will host a container security 

workshop, bringing governments and industry experts together to 

discuss how we can make water-based cargo shipping more secure 

against proliferation. 

Mr. Chairman, you asked about future plans. The United States 

is pursuing boarding agreements with key flag states to facilitate 

maritime interdiction cooperation. We have signed two agreements 

to date, with Liberia and Panama, and have many more under active discussion and consultation. Additionally, we are considering 

what mechanisms might facilitate cooperation in air and ground 

interdiction arenas. 

In part, because of the sobering lessons learned from A.Q. Khan’s 

activities, the President in February called for the work of PSI to 

be expanded to focus on shutting down proliferation networks and 

bringing those involved to full justice. 

A year after its creation, the PSI is today a successful initiative 

that resonates with countries worldwide. Its simple tenets make 

good nonproliferation sense. States understand that, by working together, we will have a greater impact than by acting alone. Our 

partners are responding by establishing practical cooperative partnerships to defeat proliferation. As a result, the PSI is poised, 

through either actual interdiction or the deterrent of threatened 

interdiction, to impact significantly the international proliferation 

networks and supplier-recipient relationships among proliferators. 

In conclusion, let me emphasize that the proliferation of weapons 

of mass destruction, missiles, and related materials remains a challenge to international security. I hope my testimony has shown the 

resolve and commitment of the Federal nonproliferation community 

to develop solid creative responses to the danger of proliferation, 

and in particular, responses to illicit procurement of WMD and 

missiles. 

Thank you again for the opportunity to testify here today. I look 

forward to hearing more about your concerns and to addressing 

your questions. 

Senator FITZGERALD. Thank you. Mr. Lichtenbaum. 

8

1The prepared statement of Mr. Lichtenbaum appears in the Appendix on page 36. 

TESTIMONY OF PETER LICHTENBAUM,1 ASSISTANT SECRETARY OF COMMERCE FOR EXPORT ADMINISTRATION, U.S. 

DEPARTMENT OF COMMERCE 

Mr. LICHTENBAUM. Thank you, Mr. Chairman. 

The mission of the Commerce Department’s Bureau of Industry 

and Security, or BIS, is to safeguard U.S. national security, foreign 

policy, and economic interests through implementing U.S. export 

control policy on dual-use commodities, software, and technology. 

In addition, BIS is charged with enhancing compliance with those 

controls and enforcing them worldwide. We also promote the development of effective export and transit control systems in key countries and transshipment hubs, i.e., controls relating to foreign origin products in addition to U.S.-origin products. In that regard, 

clearly our work relates to what Senator Akaka mentioned about 

developing and strengthening existing export control systems. 

BIS’s principal objective is to ensure that direct exports from the 

United States and re-exports of U.S.-origin items from third countries are consistent with national security and foreign policy interests, without imposing unnecessary regulatory burdens on U.S. exporters or impeding the flow of legitimate trade. 

When dealing with the international WMD networks which are 

our subject here today, it is critical to promote compliance abroad 

with our controls, and to that end Commerce has been very active. 

We conducted four international export control outreach seminars 

in 2003 with the goal of providing key export control related information to companies that use U.S. original parts for manufacturing, companies that use U.S.-origin system software technology 

to develop foreign-made products, and companies that re-export 

U.S. items. 

Over 1,000 people attended the BIS conferences which were held 

in Japan, South Korean, Singapore, and China, and came away 

with a better understanding of our rules. 

However, clearly, controlling the use of U.S. technologies alone is 

not sufficient to hinder procurement by international WMD networks, as many of the most sensitive items are available in countries throughout the world, and that is a critical challenge for our 

export control work. 

It is imperative, in my view, that the U.S. Government work 

with international suppliers in order to effectively control the export of these sensitive items. To that end, the United States is 

leading the efforts to strengthen the four multilateral regimes 

which are the traditional mechanism for international cooperation 

in this area. In particular, we are working to improve the control 

lists, for example, by ensuring that we control any item that is of 

particular interest to terrorists, and controlling the export of any 

item intended for use in a WMD program or delivery system 

through catch-all controls. We think we are making excellent 

progress working with the State Department toward those ends. 

But it is not enough to just work in the traditional export control 

regimes because only a small portion of countries in the world are 

members of these regimes, and therefore, BIS participates in U.S. 

Government efforts to build a more effective international system 

9

of export controls beyond these regimes and by assisting other 

countries to develop and enforce effective export controls. The importance of those activities is shown by the A.Q. Khan case, which 

involved technology and components exported from countries who 

were not members of the regimes. 

As part of the State Department’s Export Control and Related 

Border Security Assistance Program, or EXBS, BIS conducts technical exchanges with more than 30 countries that need assistance 

in this area. Working with other U.S. agencies we design specific 

programs toward the needs of each country, and then give them 

training that is customized to their needs. 

During the last fiscal year, for example, we conducted 74 bilateral technical exchange workshops and one multilateral conference, 

as part of the EXBS Program. We helped countries draft legislation 

and helped companies in those countries adopt effective compliance 

programs because, as Senator Akaka mentioned, it is not just a 

question of working at the governmental level, but also doing outreach to the private sector, who may be legitimate countries. There 

is a long list of countries that we have worked with, many of them 

in the former Soviet Union. We have developed software that is 

specifically designed to help companies comply with their national 

export control rules. We also developed software that helps Customs officials in these countries identify the products that are of 

most concern to us, because it is often the question of having the 

training to know when a product that is at the border is an item 

of concern. 

Russia, for example, has begun deploying this product identification tool that we developed in its regional Customs centers in preparation for deployment to more than 150 Customs posts. 

We also have another major initiative outside of the EXBS Program to strengthen controls in other countries. In 2002 we 

launched a Transshipment Country Export Control Initiative, or 

TECI, and that initiative focuses on transshipment hubs: Cyprus, 

Hong Kong, Malaysia, Malta, Panama, Singapore, Taiwan, Thailand, and the United Arab Emirates. 

Some of these countries do have export control systems in place, 

but none of them participate in all four of the multilateral regimes 

that I mentioned. All are major hubs for high tech products and 

they all operate near countries of concern. Some of them, as you 

mentioned, have been implicated in some of the recent developments of concern. 

Under TECI, BIS has already made significant progress. We 

have developed a public/private partnership on best practices for 

export controls. We have placed attaches in Hong Kong and Abu 

Dhabi, and we visited many of the TECI countries at senior levels, 

including Hong Kong (where I was a month ago), Malta, Panama, 

Thailand, and the United Arab Emirates, in order to emphasize the 

importance of strengthening export control systems. 

I think all of these efforts provide countries with the knowledge 

and the ability to fulfill their commitments to the United Nations. 

As you know, the United Nations recently passed, at the President’s suggestion, UN Security Council Resolution 1540, which 

calls on countries to adopt effective export control systems. 

10

Finally, with respect to the PSI, which Mr. Fitzpatrick discussed, 

although the State Department and the Defense Department are 

properly providing most of the policy and operational leadership, 

we have participated actively in the development of the Statement 

of Interdiction Principles, the strategies for outreach to other governments, and particularly are focused on the outreach to industry 

because we think industry can really play a very important role in 

leveraging the resources of government in order to make the PSI 

effective. 

So that gives you an overview of our important initiatives, working with other agencies to counter proliferation of WMD technologies. We are strengthening export controls here at home and 

abroad, and I would be happy to answer any questions that Members of the Subcommittee may have. 

Senator FITZGERALD. Thank you very much. Senator Lautenberg. 

OPENING STATEMENT OF SENATOR LAUTENBERG 

Senator LAUTENBERG. I will try to be brief, but I commend you 

for holding this hearing. I think it is a particularly important hearing and I commend the Chairman for holding it. 

In these days of lots of concerns about the capacity of rogue organizations, rogue countries, to be able to buy materials that are ultimately available to make weapons of mass destruction out of them, 

we know that delivery systems have been perfected in lots of 

places. We saw them used, as a matter of fact, in the first Gulf War 

when missile were fired from Iraq to Israel and Saudi Arabia as 

well. So we are concerned about the finding of the recent Harvard 

University report. The authors there found that not nearly enough 

is being done to keep nuclear fissile materials away from terrorists 

and rogue states, Iran, Libya, North Korea, to name just the most 

obvious. The principal conclusion of the authors is that fewer fissile 

materials were secured in the 2 years after the September 11 attacks then in the 2 years leading up to that horrific day. According 

to the authors, it will be well over a decade before nuclear fissile 

materials located in over 140 countries worldwide are adequately 

secured. Until then such materials are vulnerable to acquisition by 

terrorists and nations that support them. 

In the post-September 11 world the prospect of terrorists acquiring nuclear weapons of mass destruction is particularly alarming. 

Counterproliferation efforts are urgently needed, and I am pleased 

that our G–8 partners pledged at the meeting in Sea Island earlier 

this month to address and curb the spread of nuclear fissile materials. 

And as we have learned from revelations about the A.Q. Khan 

network operating in Pakistan, once fissile and other dangerous 

materials are out on the world market, it is darn hard to track 

them down. 

I would like to raise several critical questions that our witnesses 

and we need to address with regard to counterproliferation efforts. 

First, how well we secured nuclear fissile materials outside of the 

former Soviet Union. At one point we appropriately focused on our 

nonproliferation efforts on that region with programs like the 

Nunn-Lugar Initiative. We cannot do that any longer. Our 

11

counterproliferation efforts cannot be limited to Russia or its neighbors any more, as we heard from——

Senator FITZGERALD. Mr. Lichtenbaum and Mr. Fitzpatrick. 

Senator LAUTENBERG. Our counterproliferation efforts cannot be 

limited to Russia, or its neighbors any more. They must be extended to places like Malaysia and Sudan. 

And second, how well have we closed loopholes that let nations 

develop nuclear weapons programs under the cover of nuclear energy programs? Recently the International Atomic Energy Administration has been having problems getting Iran to cooperate with its 

inspections because Iranian officials claim they have the right to 

develop nuclear energy as they see fit. 

Third, how well are we developing a global network for border 

security? I am particularly concerned about export control at our 

seaports, where over 95 percent of all containers being shipped 

worldwide are not being inspected. 

Fourth, what are we doing diplomatically not only to reduce regional tensions but to send a stern message that smuggling nuclear 

fissile materials and weapons, or engaging in related trade, is totally unacceptable? I am afraid that the alienation of so many of 

our allies in other matters might come back to haunt us in this regard. I worry that we are going to have less cooperation in nonproliferation efforts as a result of our diminished credibility worldwide. 

Finally, I would like an update on Libya. I have had an active 

interest there since the downing of PanAm 103, and I have been 

suspicious from the start by Muammar Qadhafi’s sudden desire to 

reform and to rehabilitate Libya’s international standing. Libya’s 

murderers, who went out and killed 38 of my constituents in 1988, 

along with 140 other Americans, nearly 100 British citizens in the 

PanAm 103 attack—and I am cautious that Libya has destroyed 

some of its weapons programs—but I would like to hear from our 

witnesses about Libya’s previous role in global smuggling networks 

and its ties to Khan and his nefarious deals. 

It is a useful hearing, Mr. Chairman, and if we can get answers 

to some questions, we will have made a good deal of progress. 

I thank you and I thank our witnesses for their testimony. 

Senator FITZGERALD. Thank you very much, Senator Lautenberg. 

I would like to direct this question to either of you. I am curious 

about the Proliferation Security Initiative. You both described it, or 

it has been described in many printed materials, particularly in 

this brochure that they put out, that the PSI is an activity, not an 

organization. Does that mean there is no organization to this activity? Do we not have to have somewhere an organization, a bureaucracy there? How do we get things done? Little League Baseball is 

an activity, but there is an organization. There are people organizing the activities that are part of it. So I am curious about that. 

Mr. FITZPATRICK. Mr. Chairman, in one sense you are looking at 

the organization. My colleagues in the State Department are part 

of what might be described as a loose organization among participating governments, the 14 core group countries, and the additional dozens of countries that have expressed an interest in working together in some part of PSI. 

12

We do not believe that it is necessary always to establish a 

formal bureaucracy, a secretariat in a foreign capital, where the 

focus can sometimes become more on the apparatus of the bureaucracy than on the actual functions involved. So we find that in 

bringing the core countries together, the experts together, the intelligence, the defense operational experts together in various settings, that we can create the wherewithal to be able to effectively 

interdict. 

We want to be able to create rapid response mechanisms, to 

know the points of contacts in the intelligence, law enforcement, 

and diplomatic communities, so that when we spy an activity, or 

one of the partners spies an activity, we can immediately coordinate resources of those countries that can bring resources to bear 

and take effective action. 

We did that in the case of the BBC China that you noted in October, and partly to address Senator Lautenberg’s question about 

Libya. 

Senator FITZGERALD. Was this set up by an Executive Order or 

what created the PSI? 

Mr. FITZPATRICK. It was initiated by the President in a speech 

in Poland over a year ago. It has not required a great deal of additional financial resources because we have been putting together 

the structure through existing diplomatic resources. 

The State Department is the lead on the policy, but the Defense 

Department is the lead on many of the operational activities. 

Senator FITZGERALD. You only have 14 nations involved. That 

leaves a whole lot of nations that are not involved, and there are 

no formal treaty obligations behind this, so it is all voluntary. It 

almost seems like we are not taking this seriously enough. Do we 

not have to try and get as many nations as possible locked in under 

formal obligations if we are not going to let trafficking go on? 

Mr. FITZPATRICK. One of the areas of formal obligations that we 

are trying to lock nations into are the boarding agreements that we 

have been undertaking with the countries that are the largest flag 

state-nations—Liberia and Panama—as I mentioned, and a dozen 

or so other countries with whom we are now actively pursuing such 

formal legal arrangements. As a reult, if there is a vessel flying the 

Liberian flag that is known to be carrying, or thought to be carrying lethal weapons of mass destruction, we now have a legal 

basis for interdicting that ship. So I do not think there is any lack 

of organizational structure to this. 

The 14 countries are the ones who inaugurated it, but beyond 

these there is a spreading tier of other countries that we want to 

bring into it. The coastal states, the flag states, the transshipment 

states and the transit states, these are all the countries to whom 

we’re reaching out. And as I noted, there were more than 60 countries that have expressed an interest. Over 60 countries attended 

the one-year anniversary meeting in Krakow last month. 

Senator FITZGERALD. How can we be assured that the PSI activities are receiving adequate resources, or that they are not diverting 

personnel and funds away from other important activities, if we 

have no organization that we can look at, see an organization 

chart, and fund through the annual budgetary process? 

13

I imagine you have many duties in the Department of State and 

this is just one of your duties. If there is no formal structure to the 

PSI, how do we know either that you are putting enough time into 

the PSI or that you are not shirking your other duties? I would 

imagine there would just be lots and lots of people involved. How 

many people in the administration through the Departments of Defense, Commerce, and State, would be involved in the PSI? 

Mr. FITZPATRICK. My colleague tells me it is probably three dozen 

or more, who on a daily basis are involved in this. I mean, obviously we have to shift priorities, and this is one of our greatest priorities, so the time that I personally used to spend on worrying 

about weapons of mass destruction in Iraq, I now spend on PSI, for 

example. 

Senator FITZGERALD. We do not have any PSI offices inside the 

government? 

Mr. FITZPATRICK. Under Secretary Bolton is the head of the effort 

of the State Department that overlooks PSI, and underneath him, 

Assistant Secretary John Wolf and my staff. 

Senator FITZGERALD. But there would be one person in charge at 

DOD and one person at Commerce? Is there any one person who 

is in charge overall? 

Mr. FITZPATRICK. Sir, the National Security Council-led Policy 

Coordination Committee for Proliferation Strategy is the mechanism that coordinates inter-agency, and I think we could point to 

one individual in each of the agencies that are responsible for this. 

I hesitate to do so outside the State Department though. 

Senator FITZGERALD. OK. I understand that you may have had 

some successes that you are reluctant to publicize, at least I hope 

you have had some cases where you have been successful in interdicting weapons of mass destruction, but I am wondering if you 

might be able to discuss any reasons for the reluctance to inform 

the public of any interdiction successes? 

Mr. FITZPATRICK. Sir, the reason for not publicizing some of the 

activities of the PSI is that intelligence sources are often the reason 

we know about activities, and so as not to jeopardize those intelligence sources and methods, this activity really cannot be discussed in this kind of a hearing. 

Senator FITZGERALD. OK. Senator Akaka. 

Senator AKAKA. Thank you very much, Mr. Chairman. 

Mr. Lichtenbaum, the other day the Director General of the 

International Atomic Energy Agency stated, ‘‘The present system of 

nuclear export controls is clearly deficient. The system relies on informal arrangements that are not only non-binding, but also limited in membership, and many countries with growing industrial 

capacity are not included. Moreover, at present there is no linkage 

between the export control system and the verification system.’’ 

A system that is deficient when it comes to nuclear material and 

weapons controls puts all humanity at risk. My question to you is 

what is the administration proposing to correct these deficiencies? 

Either one of you may answer that. 

Mr. LICHTENBAUM. I think we may both answer, because it is an 

excellent question, Senator. 

With respect to the comment about the Nuclear Suppliers Group, 

which is the existing multilateral export control regime in the nuVerDate 0ct 09 2002 15:00 Dec 06, 2004 Jkt 095191 PO 00000 Frm 00017 Fmt 6633 Sfmt 6633 C:\DOCS\95191.TXT SAFFAIRS PsN: PHOGAN
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clear area, it is correct that theNSG has a limited membership. 

The goal is not to have a universal membership, but to have a 

membership among the countries who are significant nuclear suppliers. In part that is because that group operates by consensus, so 

that it is important to only have countries at the table who are significant nuclear suppliers, rather than having a global coverage in 

membership, and thus having every country in the world be able 

to have a veto over actions of the NSG. 

I might add that consensus rule has on occasion been very important to the United States, so we have historically been a strong 

supporter of a consensus rule that applies not only in the NSG, but 

also in the other multilateral regimes. 

I think the NSG and the other regimes have shown themselves 

able to adjust to changing world circumstances and the growth of 

countries and suppliers where necessary. They have established 

criteria for membership, and in the case of the NSG, I might draw 

to your attention the recent accession of China to the NSG, which 

obviously recognizes the reality of China’s status as a nuclear 

power, its increasing acceptance of responsibility in the export control area, and therefore, properly includes them in the organization 

that deals with nuclear export controls. 

I think where necessary the NSG has shown itself able to include 

countries who are nuclear suppliers. 

With respect to the linkage between the NSG and the IAEA, I 

might defer to Mr. Fitzpatrick on that if he would care to comment, 

because I know he has a background with the IAEA, having served 

in Vienna, and it is a particular responsibility of the State Department. 

Mr. FITZPATRICK. Thank you, Senator Akaka. I think Secretary 

Lichtenbaum answered the question well. I might only add that in 

addition to the formal membership of regimes, many countries outside the regime conform their controls to regime standards, and 

this is often one of our bilateral diplomatic goals, to encourage a 

country—for example, India—to conform their regimes. They cannot be part of the nuclear suppliers group because they do not accept full scope safeguards, but they can conform their export controls to that of the regime, and we are encouraging them to do so. 

Regarding the linkage, I have to read more about what the Director General ElBaradei proposed. It is helpful that the Nuclear Supplier Group membership is centered in Vienna, in the same capital 

that the IAEA has its headquarters so that there are informal linkages. But it would probably be impossible to have too formal of a 

linkage. If all 100 plus countries that are part of the IAEA were 

in a suppliers group that operates by consensus, nothing would 

ever get done. 

What we are trying to do in the Nuclear Suppliers Group is plug 

the loopholes that have allowed some states to acquire nuclear 

weapons or to come near to acquiring nuclear weapons capabilities 

under a facade of pursuing peaceful programs. One of the initiatives that President Bush announced in his February 11 speech 

was to preclude states that do not now have enrichment and reprocessing capabilities from acquiring those capabilities. Draw a 

line beyond those that have it and no more, would prevent the likes 

of Iran, for example, from acquiring enrichment technology. And at 

15

the G–8 Summit last week in Sea Island, the G–8 countries, all of 

them, agreed that it would be prudent to, for at least 1 year, to 

suspend any expansion of technology to states that do not already 

have it in enrichment and reprocessing. We would like to make this 

1 year become a permanent moratorium. 

Senator AKAKA. My time has expired. I have further questions, 

and I will have questions on China, too. Thank you, Mr. Chairman. 

Senator FITZGERALD. Senator Lautenberg. 

Senator LAUTENBERG. Thanks, Mr. Chairman. 

Mr. Lichtenbaum, are there amounts of dual-use technology and 

materials that we are aware of that U.S. companies are exporting 

throughout the world, and obviously if these things were to get into 

the wrong hands, they could be used to develop terrible weaponry. 

Do we have any ideas about how much of this dual-use material 

or technology is being exported by U.S. companies? 

Mr. LICHTENBAUM. I guess there would be various ways to measure the volume of dual-use technology or items that are being exported. 

Senator LAUTENBERG. Even if we got it down to the incidents of 

this happening. 

Mr. LICHTENBAUM. One way to answer it, and the only way that 

I can provide to you here, although I would be happy to provide 

more ways for the record, Senator, would be in terms of the overall 

U.S. GDP. My recollection is that the amount of licensed trade—

that is, items that we require an export license for at the Commerce Department—is somewhere around 1 percent of U.S. GDP, 

so it is very small as a matter of the overall U.S. economy. 

Senator LAUTENBERG. Yes, but the U.S. economy being the size 

that it is, if it is 1 percent, I mean we are talking about a substantial sum of——

Mr. LICHTENBAUM. That is certainly true. 

Senator LAUTENBERG. What do we do about that? I mean the biggest cover for these surreptitious activities is dual use, right? They 

say, ‘‘We just want to use it for nuclear energy.’’ And what the 

steps that follow are, I guess, traceable but not obvious. What do 

we learn if we do find out that material has been shipped in the 

belief that it is going to be used primarily on the energy side? 

Mr. LICHTENBAUM. The dual-use items that you are talking about 

would be our items that are controlled for nuclear nonproliferation 

reasons, and those we would have subjected, when we issue a license, to license conditions. We license them not just in general for 

export, but for export to a particular end user for a particular end 

use. That is inherently part of the obligation of the exporter, to 

make sure that they comply. There may also be additional conditions that they are required to follow. Frequently we impose license 

conditions that talk about access to the item or disclosure of technology being limited to certain individuals within the foreign end 

user, etc. So we have, we think, a well crafted set of commitments 

that U.S. exporters have to comply with as a condition of exporting 

a nuclear item to another country. 

Certainly, we cannot, under any reasonable scenario, be monitoring every license all the time to make sure that those rules are 

followed. We do post-shipment verifications. Where we think there 

is especially sensitive items or end users that are particularly—we 

16

think they are worthy or we would not grant the license, but where 

we think there is a question perhaps, we would then go and do a 

post shipment verification, make sure the item is where it is supposed to be. 

Senator LAUTENBERG. I do not know how big the opening is there 

for skullduggery, but the fact is that, as you say, you cannot really 

monitor it once it is shipped and arrives someplace else. What 

about re-exportation, how can you verify, or can you verify that the 

listed recipient of the final destination for export is an accurate assessment of the shipment’s ultimate use? It really is kind of the 

same question, and I guess I do not know what tools you have to 

do that, but it is something. 

When you describe, Mr. Fitzpatrick, the organization that is 

there to keep an eye on these things, it is a relatively small thing, 

but problems that might ensure are enormous. 

Let me go on to a different area. When Mr. Khan confessed that 

his network was engaged in smuggling weapons into Libya, North 

Korea, among other rogue nations, was the administration aware 

of these deals with these states considered to be sponsors of terrorism before Mr. Khan’s confession, do we know? 

Mr. FITZPATRICK. Senator, I regret that the question inevitably 

strays into the area what we knew through intelligence information, and I am just not able to answer that question in this sort 

of a structured hearing. 

Senator LAUTENBERG. I see. The disclosures about weapons programs in Libya, are they accounted for in transactions that were 

made through A.Q. Khan network, the materials that were sent to 

Libya, was there an accounting of that material that we have an 

awareness of? 

Mr. FITZPATRICK. Sir, that is a question that we are intently focusing on right now. We want to be sure with as much confidence 

as we can, that Libya has accounted for all the materials that came 

into its possession. Considering all of the information that we have 

through intelligence, and through what the IAEA has reported 

about its own investigations, we need to be able to determine with 

a good deal of certainty that Libya has completely come clean on 

all of it. 

As you know, we have taken out of Libya the most dangerous 

materials, a planeload in February and a shipload in March. I am 

not able to tell you now, because we have not finished our consultations with Libya and with the IAEA, but I hope that in the coming 

months we will be able to give you an affirmative answer to that 

question, but it is very much the question that is on our minds. 

Senator LAUTENBERG. We would be very interested. I am suspicious, as are many of the families of PanAm 103 who lost loved 

ones, that there is a full intent to become a member of the family 

of nations that are on this side. So we thank you. We would ask 

that you inform us if you do get anything. 

Mr. Chairman, that concludes it for me, and I thank you very 

much. Thank the witnesses. 

Senator AKAKA [presiding]. Thank you, Senator Lautenberg. 

Mr. Lichtenbaum, I said that I would return to China. 

China and the United States, after years of negotiations, recently 

concluded a new agreement on improved end use verification proceVerDate 0ct 09 2002 15:00 Dec 06, 2004 Jkt 095191 PO 00000 Frm 00020 Fmt 6633 Sfmt 6633 C:\DOCS\95191.TXT SAFFAIRS PsN: PHOGAN
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dures to monitor the ultimate use of dual-use exports to China. The 

concern is this could allow for increased U.S. high technology exports to China. As you know, Chinese assistance is essential to restricting North Korean WMD-related exports, both because many of 

those exports may transit Chinese air or sea corridors. However, 

China has not yet become a member of PSI. 

I wonder what your view would be to conditioning U.S. high technology exports on a state’s participation in the PSI? If our goal is 

universal adherence to the program, is this not one way to get it? 

Mr. LICHTENBAUM. Thank you, Senator, for a very thoughtful 

question. 

The question of U.S. high technology exports to China is a very 

important one, as it has both significant economic implications for 

our country, given the size of the Chinese market, as well as national security implications in light of any potential that high technology items could be diverted, and therefore it is a question that 

the administration focuses on very intently, as I can testify from 

my personal experience since coming into office. 

I think the balance to be struck in the high technology area has 

to be developed on a case-by-case basis, so it is difficult to say that 

if you join PSI, therefore we will open the floodgates and allow you 

access to our high technology goods. From my own experience 

working the export control cases, case-by-case through the interagency process, it is critical that we make those judgments in order 

to protect U.S. national security on a case-by-case basis, and so I 

would be reluctant to see export controls used as the carrot to entice China to join the PSI. 

I would think that it would also be perhaps ineffective in terms 

of achieving the goal that we all want to achieve, which is China’s 

strong participation in the PSI, and I would welcome Mr. Fitzpatrick’s thoughts on this, but I would think that countries’ participation in PSI would be most effective if they themselves believe in 

the program, and believe strongly that it makes sense in terms of 

their own security interests and the world’s security interests for 

them to participate. Therefore, if they were to join in order to obtain some other benefit, but without fully being on board for the 

program, it might not be the most effective way to have them participate. So my view would be that it is important for the United 

States to continue its work with China to persuade them of the 

benefits of the PSI. 

Senator AKAKA. Mr. Fitzpatrick. 

Mr. FITZPATRICK. Thank you. Once more I have to say that Secretary Lichtenbaum has put the point very well. 

China does support the goals and objectives of PSI, but the proof 

is in the pudding, and we can point to a factual basis for this. 

China has been willing to cooperate on a case-by-case basis in stopping proliferation, and in fact, cooperated on a particular case involving chemicals that were destined to North Korea’s nuclear 

weapons program. This was a very high priority, to stop such material going to the North Korea program, and China cooperated in 

stopping this. 

Secretary Powell referred to this case in a recent speech in 

Texas. I wish I had the exact date, but this is, I think, something 

we can point to. 

18

That does not mean China’s cooperation has been fulsome, but 

on a case-by-case basis they have been cooperative, and we are 

strongly encouraging them to do more. 

Senator AKAKA. I really appreciate your responses, and I have 

further questions that we will submit for the record, and I will 

keep it open for another day for other questions from Members of 

the Subcommittee. 

But I want to thank you very much, Mr. Lichtenbaum and Mr. 

Fitzpatrick for your presence here. Thank you for being patient, 

and thank you for being helpful. This will help us determine what 

we need to do to help our country in PSI and in WMD matters. So 

thank you very much. 

Mr. FITZPATRICK. Thank you, Senator. 

Senator AKAKA. Thank you very much. 

I would like to call forward the next panel. David Albright, Michael Moodie, Leonard Spector, and Baker Spring. 

May I ask the panelists to contain your testimony, and to keep 

it to 5 minutes. 

Our first witness on this panel is David Albright, President and 

Founder of the Institute for Science and International Security. 

The institute is a nonpartisan organization dedicated to informing 

the public of policy issues affecting international security. The Institute’s work focuses in part on efforts to stop the spread of nuclear weapons and to enhance the transparency of nuclear arsenals 

throughout the globe. Dr. Albright has published numerous assessments of secret nuclear weapons programs around the world. From 

1992 through 1997, he actively collaborated with the International 

Atomic Energy Agency to analyze Iraqi documents and past procurement activities. In 1996 he was the first non-governmental inspector of the Iraqi nuclear program. 

Next is Michael Moodie, who is President and Co-Founder of the 

Chemical and Biological Arms Control Institute, a research organization that addresses the challenges to global security and stability. The Institute’s work focuses on the elimination of chemical 

and biological weapons and responses to emerging national security 

threats. Mr. Moodie has almost 30 years of experience working on 

international security issues in government, the policy research 

community and academia. For example, from 1990 through 1993 he 

served as Assistant Director of the Multilateral Affairs of the U.S. 

Arms Control and Disarmament Agency, where he advocated U.S. 

policy relating to arms control in the Geneva-based conference on 

Disarmament and the United Nations first committee. 

Our third witness is Leonard Spector. Good to have you back 

here. You were with Senator Glenn. Mr. Spector is Deputy Director 

at the Center for Nonproliferation Studies at the Monterey Institute of International Studies. Mr. Spector leads the Center’s Washington office, and also serves as editor in chief of the Center’s publications. Prior to joining the Center for Nonproliferation Studies, 

Mr. Spector served as Assistant Deputy Administrator for Arms 

Control and Nonproliferation at the National Nuclear Security Administration in the Department of Energy. While serving at the 

Energy Department Mr. Spector was responsible for the development and implementation of arms control and nonproliferation policy, domestic and multilateral export controls, civilian nuclear proVerDate 0ct 09 2002 15:00 Dec 06, 2004 Jkt 095191 PO 00000 Frm 00022 Fmt 6633 Sfmt 6633 C:\DOCS\95191.TXT SAFFAIRS PsN: PHOGAN
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1The prepared statement of Mr. Albright appears in the Appendix on page 45. 

grams in the United States and abroad, as well as initiatives in regions of the world with proliferation activities. 

Our fourth and final witness is Baker Spring, who is the F.M. 

Kirby Research Fellow in National Security Policy at the Heritage 

Foundation. Mr. Spring’s research focuses on U.S. national security 

issues, including arms control, nonproliferation policy and missile 

defense. Mr. Spring has written extensively on these topics and 

others, including nuclear proliferation in North Korea, transforming the U.S. military, and the future of the United Nations. 

Prior to joining the Heritage Foundation, Mr. Spring served as a 

defense and foreign policy expert in the offices of former Senator 

Paula Hawkins of Florida and Senator David Karnes of Nebraska. 

Again, I would like to thank our witnesses for taking time out 

from a busy schedule to be here today to testify. I did ask you to 

keep it to 5 minutes, and we will include your statements in the 

record. Let me call on Dr. Albright to begin. 

TESTIMONY OF DAVID ALBRIGHT,1 PRESIDENT AND FOUNDER, INSTITUTE FOR SCIENCE AND INTERNATIONAL SECURITY 

Mr. ALBRIGHT. Thank you for having this hearing and inviting 

me to speak. 

One of the biggest surprises about the Khan network was its 

sheer audacity and scale. It intended to provide Libya a turnkey 

gas centrifuge facility, something typically reserved for states or 

large corporations in industrialized nations with full government 

support and knowledge. The plan called for the network to provide 

thousands of gas centrifuges, detailed project designs for the centrifuge plant, down to where the toilet paper would go in a bathroom, centrifuge designs, manufacturing equipment and technology 

to make more centrifuges indigenously, and ongoing technical assistance to help Libya overcome any obstacles in assembling and 

operating the centrifuges in the plant. 

If Libya had continued with its nuclear ambitions and the network had not been exposed, Libya could have succeeded in about 

4 or 5 years in assembling its centrifuge plant and operating it to 

produce significant amounts of highly enriched uranium. 

Armed with this HEU, Libya would have known how to turn that 

HEU into nuclear weapons. The reason is simple. The network provided Libya with information to build a workable nuclear weapon. 

Libya received almost all of the detailed nuclear weapon component 

designs, component fabrication information, and assembly instructions for a workable nuclear device. 

Much remains to be discovered about this network before its operations are fully understood or its complete demise can be celebrated. It is necessary for governments and the International 

Atomic Energy Agency to be persevering in investigating this case. 

If these investigations are not done thoroughly, the risk will be 

greater that a similar network could rise again from the remnants 

of the disbanded Khan network. 

The first unfinished task is identifying all the network’s key 

players and their activities. Many legal investigations of members 

20

of the network have started. Momentum may in fact be increasing 

around the world to prosecute the key players in this network. But 

a critical task remains, determining all the players and their activities. The ultimate goal should be prosecuting them as fully as possible under both export control laws and laws involving exports to 

terrorist states as Libya was labeled, and this process will likely 

take years. 

It is also critical to determine the network’s customers, and this 

effort again will take considerable time. Although Khan has admitted that he provided centrifuge items to Libya, North Korea, and 

Iran, little has been reported about other recipients of centrifuge 

and nuclear weapons assistance. In addition, many details of this 

assistance remain unknown, particularly in regards to North 

Korea. A key question is whether Iran or North Korea also received 

nuclear weapons design information like Libya did. Questions remain whether Syria was a customer for centrifuge or nuclear weapons assistance, although Khan has denied selling anything to 

Syria. Finally, did terrorists receive any information or other assistance from the Khan network? 

Another unfinished task is understanding the entire supply 

chain of the network. In the case of Libya the network focused on 

making what are called P2 centrifuge components outside Pakistan. The Libyans have stated they placed an order for 10,000 P2 

machines, which translates into a total of about one million separate components, a staggering number of parts, given the sophistication of gas centrifuge components. The network was assembling 

a significant cast of experts, companies, suppliers, and workshops 

to make all these components. The organization of this project was 

quite impressive. 

But investigations of the supply chain of the network are unfinished. It is not known if all the key workshops and companies have 

been identified. Components may have been made but not delivered 

to Libya, and components may also have been made for customers 

other than Libya. 

The final task I would like to mention is the retrieving of centrifuge designs and manufacturing instructions from the network. 

The key to the success of this network was its virtual library of 

centrifuge designs and details manufacturing manuals and other 

types of instructions. A key task is to track down the members of 

this network who have this kind of a sensitive centrifuge information, prosecute them and try to retrieve as much of this information as possible. 

However, retrieving all the centrifuge information may not be 

possible since copies can be made and hidden for years if desired. 

Thus, even if the retrieval effort is reasonably successful, the centrifuge information may form the core of a future network aimed 

at secretly producing or selling gas centrifuges. 

A priority and a major point of discussion today is preventing 

other illicit networks similar to the Khan network and nuclear 

smuggling through less elaborate methods. In addition, steps are 

needed to increase the probability of more quickly discovering such 

efforts, and certainly the first priority is fully investigating and dismantling the Khan network. Investigations need to continue and 

intensify in a range of states including Malaysia, Switzerland, BritVerDate 0ct 09 2002 15:00 Dec 06, 2004 Jkt 095191 PO 00000 Frm 00024 Fmt 6633 Sfmt 6633 C:\DOCS\95191.TXT SAFFAIRS PsN: PHOGAN
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ain, France, Italy, Spain, United Arab Emiates, Germany, and Turkey, to just name a few. 

More information is needed from states that benefited from this 

network, particularly Libya, Iran, and eventually North Korea. In 

addition, Pakistan’s cooperation is critical. The Pakistani Government has provided useful information to the IAEA and other 

states, and it appears committed to providing more information. 

However, the Pakistani Government should permit the International Atomic Energy Agency and perhaps other governments direct access to A.Q. Khan and his associates involved in this network in Pakistan. 

The successes of the Khan network should shatter any complacency about the effectiveness of national and international nuclear 

related export controls to stop or sound an alarm about illegal of 

nuclear-related exports. Although the Proliferation Security Initiative is useful and important, it cannot fix the fundamental weaknesses of the current export control regime. The Khan network was 

masterful in identifying countries that had weak national export 

control laws, yet adequate industrial capability for the network’s 

purposes. These countries were both inside and outside the Nuclear 

Suppliers Group. 

Although many suppliers to the network did not know the actual 

purposes of the materials they provided or the parts they were contracted to make, they were often in countries where the authorities 

were unlikely to carefully scrutinize exports or encourage curiosity 

about the actual end use of an item. The network also knew how 

to obtain for its illicit endeavors necessary subcomponents, materials, machine tools and other manufacturing equipment from countries in Europe with stringent export control systems. 

Certainly improvements can be made in the traditional export 

control system, including expanding the membership of the Nuclear 

Suppliers Group and sharing more information about actual procurements among NSG members and with the IAEA, but these 

steps are by themselves insufficient. The new UN Security Council 

Resolution 1504 is also an important step, but it does not go far 

enough to significantly reduce the risk posed by nuclear smuggling. 

The current system lacks an aggressive intrusive verification investigation organization that can provide greater confidence that 

states are implementing effective export controls and can devote its 

resources to detecting illicit nuclear and nuclear-related procurements. 

What is needed is a universal treaty-based system controlling nuclear export activities that is binding on states and includes a 

means to verify their compliance. Under such a treaty or agreement, countries would implement a set of nuclear and nuclear-related export control laws and regulations and criminalization procedures similar in nature to those required by UN Security Council 

Resolution 1540. The agreement, however, would also mandate the 

International Atomic Energy Agency to verify compliance, ensure 

the adequacy of those laws, and investigate illicit procurement activities. Signatories would inform the IAEA of all sensitive nuclear 

or nuclear-related exports, and the IAEA would have the mandate 

and legal rights to verify that the transactions are indeed legal. It 

22

1The prepared statement of Mr. Moodie appears in the Appendix on page 52. 

would verify that a country’s declarations about its nuclear or nuclear-related exports or imports is accurate and complete. 

Senator AKAKA. Mr. Albright, will you try to wind this up? 

Mr. ALBRIGHT. All right. The IAEA is a logical choice to undertake this role. It is already pursuing investigations of illicit procurement activities by Iran and Libya as part of its safeguards responsibilities under the Nonproliferation Treaty. 

By linking its safeguard system with export control verification 

and monitoring, the IAEA would be in a far better position to assure the absence of undeclared nuclear activities and detect cheating in a timely manner. By performing a task that governments 

have been unable to do, the IAEA, under such a treaty-based system, would significantly increase U.S. and international security. 

Thank you. 

Senator AKAKA. Thank you very much. Mr. Moodie. 

TESTIMONY OF MICHAEL MOODIE,1 PRESIDENT, CHEMICAL 

AND BIOLOGICAL ARMS CONTROL INSTITUTE 

Mr. MOODIE. Thank you, Mr. Chairman, for the opportunity to 

appear before the Subcommittee. 

I would like to begin by suggesting that perhaps I am something 

of an outlier on this panel. That is not because I think that the 

problem of the illegal transfer of materials and equipment related 

to chemical, biological, and nuclear weapons is not important, it is. 

But the chemical and biological dimension of this issue is a special 

challenge. Little information is publicly available on trafficking of 

chemical or biological agents of equipment, especially compared to 

trafficking of nuclear materials. 

More to the point, in my view it is not helpful to try to apply approaches used for dealing with a problem of nuclear trafficking to 

the issue as it relates to chemical and biological challenges. A 

chemical or biological equivalent of A.Q. Khan may exist, but he or 

she would be extremely difficult to identify. In my view three reasons argue for the need for a different approach to the chemical 

and biological problem. 

First, the inherently dual-use nature of chemical and biological 

materials and equipment. The requisite materials and technologies 

for making chemical and biological weapons are widely available. 

In the case of biological agents many can be found in nature. For 

both chemical and biological weapons key elements are readily 

found in legitimate biotechnology and chemical industries around 

the world where they are used for perfectly legitimate commercial 

and scientific purposes. This combination of availability and legitimate use makes it more difficult to identify potential CBW programs and track related illicit activities, including transfers. In the 

life sciences this problem is exacerbated by the very small quantities that may be needed to be transferred to bolster a weapon’s 

capability. When snippets of protein are all that you need, the notion of controlling transfers of such material becomes a less than 

useful option. 

Second, the global diffusion of the capability to exploit such elements means the technology development and application no longer 

23

conform to natural patterns of the past. There are a number of key 

dimensions of the global technology diffusion phenomenon with potentially important security implications for the United States that 

I note in my statement. These developments have created new economic and commercial realities which in turn produce opportunities 

to overcome some of the traditional barriers to acquiring chemical 

and biological weapons and open new pathways to successful proliferation. But perhaps the most challenging problem related to 

technology diffusion is the latency of weapons development capabilities inherent in that diffusion with little or no safety margin for 

timely and effective responses to a decision by a potential 

proliferator to pursue breakout. 

Third, this latency highlights a third reality, that the problem is 

more and more about knowledge. This is again especially true with 

respect to the life sciences. Although it is still an exaggeration to 

claim that yesterday’s Nobel prize winning research is today’s 

standard bench practice and tomorrow’s high school science fair 

project. It is becoming less and less of a stretch. If the necessary 

materials can be isolated from nature or gained for legitimate scientific and commercial purposes, and they can, and if the critical 

equipment is available to support business and other economic activity, and it is, then the crucial factor is what people decide to do 

with those capabilities. The challenge is shaping decisions about 

how science and technology will be used. The task is to manage the 

risks associated with the use of that science and technology in such 

a way that the potential for misuse is minimized. 

In this context it is still important to learn what we can from the 

historical experience we have available, and in my written testimony I discuss a number of historical examples. I also focus on 

some international initiatives to combat the illicit transfer or smuggling of weapons of mass destruction, including PSI, UN Security 

Council Resolution 1540 and the G–8 Global Partnership. I do not 

have time to review these discussions in detail, so in conclusion let 

me summarize my observations based on looking at these two sets 

of issues. 

First, they further highlight the differences between the application of this approach and the nuclear field on one hand and in the 

chemical and biological arenas on the other. The fact of the matter 

is that controlling materials and equipment is more possible in the 

nuclear arena because they are significant in size and signature. 

One could also argue that it matters more in the nuclear arena because gaining access to nuclear materials remains a key hurdle to 

overcome in developing a nuclear weapons capability. This is not 

the case with respect to chemical and biological weapons for which 

access to the materials and equipment is not the problem, so much 

as a range of other technical and engineering challenges. 

Second, these cases often underline the difficulty of stopping illicit chemical and biological trafficking. The details of the illicit 

transfer in the three historical cases I looked at largely came to 

light only after the fact, suggesting how hard it is to be successful 

in stopping chemical and especially biological trafficking on a 

proactive basis, and it will only become more difficult as trends 

such as global technology diffusion continue. 

24

1The prepared statement of Mr. Spector with an attachment appears in the Appendix on page 

62. 

Third, these difficulties reflect a point made earlier, that in dealing with chemical and particularly biological weapons proliferation, 

the key factor is not material or equipment, but knowledge. With 

respect to both the life sciences and chemistry, it is a very different 

world from that which existed even a decade ago, and our knowledge in these fields and what we will be able to do with that 

knowledge will only accelerate in the period ahead. The resulting 

science and technology, however, is neutral, and the issue will be 

the uses to which that science and technology will be put. Because 

chemistry and biology will not disappear, we live in a world in 

which the potential misuse of these vital sciences is a permanent 

risk. The challenge to governments and the broader community is 

to find ways to manage those risks successfully. Efforts to control 

or eliminate the illicit trafficking of chemical or biological materials 

and equipment will make a contribution to risk management efforts, but they are unlikely to be decisive in and of themselves. To 

the extent they will matter, it will be to the degree that they reinforce other risk management efforts. Thank you. 

Senator AKAKA. Thank you, Mr. Moodie. Mr. Spector. 

TESTIMONY OF LEONARD S. SPECTOR,1 DEPUTY DIRECTOR, 

CENTER FOR NONPROLIFERATION STUDIES, MONTEREY INSTITUTE OF INTERNATIONAL STUDIES 

Mr. SPECTOR. Thank you, Senator, for the opportunity to testify 

this afternoon. 

Last week the Monterey Institute Center for Nonproliferation 

Studies released an important new book which is directly relevant 

to the hearings today, entitled ‘‘The Four Faces of Nuclear Terrorism.’’ A core conclusion of that study is that today the nuclear 

threat posed by other nuclear armed states is being eclipsed by a 

new type of threat, that of nuclear instruments in the hands of 

non-state terrorist organizations. This reality requires a profound 

change in the way the United States thinks about national security 

policy. 

It is fair to conclude that at this point in history terrorist organizations are the only entities that are seeking to rain nuclear destruction on the United States without regard to the potential consequences to themselves or to the innumerable innocent victims of 

such action. Moreover, even in those instances where nuclear assets in the hands of states cause U.S. policy makers deep concerns, 

in virtually all of these cases the foremost source of their apprehension is the possibility not that the states themselves will use these 

assets against us, but that these assets will come into the hands 

of terrorist groups, who are all too eager to do so. 

For this reason, as the Subcommittee analyzes the dangers posed 

by clandestine nuclear smuggling networks, it is crucial to focus, 

not only on the suppliers, but also on the customers for their dangerous wares. 

It appears that A.Q. Khan brought his network to his customers—Iran, Libya, and North Korea. There has been no evidence 

made public as yet to indicate that the Khan network, itself, proVerDate 0ct 09 2002 15:00 Dec 06, 2004 Jkt 095191 PO 00000 Frm 00028 Fmt 6633 Sfmt 6633 C:\DOCS\95191.TXT SAFFAIRS PsN: PHOGAN
25

vided nuclear wherewithal to al Qaeda or other terrorist groups, although it is known that certain individual scientists in Pakistan 

were working with al Qaeda. 

The U.S. and international response to A.Q. Khan’s activities, 

which include pressing Pakistan and other states to close down his 

network, intensifying interdiction efforts through the Proliferation 

Security Initiative, and pursuing a series of diplomatic efforts to 

constrain Libya, Iran, and North Korea, are all to the good. But 

these efforts are not tailored to addressing the most crucial threat, 

which is nuclear terrorism. 

Here the customer is not really susceptible to diplomatic carrots 

and sticks, and the network that connects terrorists and nuclear 

materiel is as likely to be comprised of interlinked terrorist cells 

that reach into poorly secured nuclear centers, as it is to be comprised of unscrupulous nuclear companies, technicians, and middle 

men that offer their commodities on the international marketplace 

as Dr. Khan did. 

Moreover, terrorists are highly unlikely to seek to manufacture 

nuclear material. They are much more likely to try to find the material ready made at a poorly secured site, let us say in Russia or 

perhaps Pakistan, and to use that to fabricate and improvised nuclear device, or they may seek to acquire nuclear weapons themselves. 

For these reasons it is essential, even as we attempt to rollback 

networks, as David Albright and others have urged, that we also 

focus on securing these materials at the source. This means accelerating programs to secure, consolidate and eliminate weapons usable nuclear materials, and also intensifying efforts to consolidate 

nuclear weapons, and where possible, in line with existing arms 

control undertakings, such as the Presidential Nuclear Initiatives 

of 1991–92, to eliminate these weapons. 

In managing nuclear weapons material, moreover, it is crucial to 

recognize and to act upon the fact that terrorists will be most interested in highly enriched uranium, which they could fabricate far 

more easily into a nuclear weapon than they could fabricate plutonium. So we need to put HEU first when we try to go about securing these materials. 

We, in our study, thus urge the United States to dramatically revise its efforts to protect fissile materials abroad so as to make securing, consolidating and eliminating highly enriched uranium the 

leading and most urgent task, taking clear precedence over addressing the dangers posed by plutonium which nonetheless must 

remain an important priority. Our motto should be, put HEU, high 

enriched uranium, ‘‘at the head of the queue’’ I have also attached 

a chapter of the conclusions of our book to my testimony, which I 

hope you will be able to include in the record of this hearing. 

I would also add that UN Security Council Resolution 1540, 

adopted earlier this year, and which is binding on all UN member 

states, is an extremely valuable step forward because it addresses 

not only the export control dimension, but also the security of nuclear materials, and requires states to adopt strong measures in 

both of these areas. It remains to be seen, however, whether the 

resolution will be effectively implemented, and a particular concern 

26

1The prepared statement of Mr. Spring appears in the Appendix on page 86. 

is the lack of specific standards in the resolution that states would 

have to meet. 

Just to make one final point as I close, the U.S. Government now 

has a very wide range of initiatives aimed at trying to constrain 

the dangers that are the subject of this hearing. They are very effective or can be very effective when they all work together and 

form a web of initiatives, a multi-layered defense, to protect this 

country from the ultimate nuclear danger. But we need our congressional oversight process to monitor these various and very diverse initiatives. This Subcommittee, being a part of the Governmental Affairs Committee, is uniquely placed to monitor how all of 

these different elements are interacting together, to identify the 

areas of success, and to probe for gaps and urge that they be addressed. 

Thank you, Senator Akaka. 

Senator AKAKA. Thank you. Mr. Spring. 

TESTIMONY OF BAKER SPRING,1 F.M. KIRBY RESEARCH FELLOW IN NATIONAL SECURITY POLICY, THE HERITAGE FOUNDATION 

Mr. SPRING. Thank you, Mr. Chairman. I, too, appreciate the opportunity to testify, and I will try and be very brief, given the hour. 

Mr. Chairman, the policy of the United States for combating the 

proliferation of weapons of mass destruction has used four tools. 

These tools are deterring attacks on the United States and its 

friends and allies with weapons of mass destruction, maintaining 

the ability to defend against such attacks, preemptive attacks 

against those that would threaten the United States and its friends 

and allies with weapons of mass destruction against whatever capabilities they may possess and arms control. 

The trick is to fashion these four essential tools into a coherent 

policy for combating proliferation that is properly suited to countering the capabilities that either now or in the future could be in 

the hands of rogue states and terrorist groups. 

The Bush Administration is pursuing a number of specific initiatives to attack the proliferation threat posed by international networks that traffic in weapons of mass destruction and weapons 

technology by limiting access to sensitive materials and interdicting relevant shipments in transit. These include the Proliferation Security Initiative, the Global Threat Reduction Initiative, the 

Container Security Initiative, the Customs Trade Partnership 

Against Terrorism Program, and the initiative under the International Shipment Port Security Programs. Obviously, it is a wide 

variety. 

I categorize several of these initiatives, and the PSI in particular, 

more as arms control activities because they are designed to keep 

weapons out of the hands of hostile actors, as opposed to direct defense activities. 

As we look at these kinds of programs, I think that we should 

have several guidelines that help us make judgments on what will 

be effective and how best to pursue these kinds of initiatives. The 

first of these is to make sure that we use the initiatives to foster 

27

a healthy competition with the institutions of the treaty-based nonproliferation regime. In other words, that they can go hand in 

hand, but we hope that we would spur strong actions on both sides. 

The second guideline is to resist the temptation to build these 

particular initiatives into cumbersome international bureaucracies. 

We have those international bureaucracies. They have strengths, 

but they also have important weaknesses, and having a diversity 

of institutions, some more bureaucratic than others, I think, is appropriate. 

The third guideline is to design the initiatives to harness the 

power of sovereign states. Former Secretary of State Schultz has 

spoken to this issue. I think that it is important that the statebased system be used to the fullest extent possible in terms of combating proliferation. 

The fourth guideline is to avoid what I call quid pro quo deals, 

particularly in these kinds of informal initiatives. They may be necessary in the context of the Atoms for Peace Program, for example, 

but in narrowly-pursued initiatives, I hope that we do not end up 

watering down what is the objective or purpose of these initiatives. 

Specifically, I have several recommendations, and most of these 

are particularly appropriate for the Proliferation Security Initiative 

among those that are being undertaken by the Bush Administration. The first is to focus on cracking down on the domestic sources 

of proliferation, inside cooperating states uncovered in the investigation of the A.Q. Khan network. Unfortunately, as it has been 

revealed in the press at least—and I do not know how accurate 

they may be ultimately, but that PSI countries, for example, have 

been sources of technology that have gone to that network and then 

on to other suspect actors. 

The second is that with these initiatives I hope that we would 

forswear international employees and rely on the government employees to perform the bureaucratic functions of these initiatives. 

I know that the Chairman of the Subcommittee expressed concern 

about this, but I think it is actually a source of strength. 

The third recommendation is to establish new initiatives. The 

ones that I would be focused on are on international organizations 

or initiatives that would use individual member states to focus on 

dismantling weapons programs in countries that agree to that, like 

Libya, hopefully in the future like North Korea, instead of relying 

exclusively on the international bureaucracies in the Organization 

for the Prohibition of Chemical Weapons or the International 

Atomic Energy Agency. In other words, I would like to see some 

tiger teams go in and accompany the international bureaucracies 

in terms of dismantlement. 

The same would extend to another initiative that I envision on 

verification. That is, if the dismantlement process proceeds and 

other transparency measure are undertaken, that verification is 

not left up solely to the international bureaucracies. 

The final recommendation that I have is something that has 

been pursued in the PSI in terms of outreach to other states that 

are not core participants, but are cooperative in terms of their attitudes, and that is by pursuing it on a regional basis. I think the 

Japanese, in particular, did this very effectively with regard to the 

28

PSI in terms of fostering support from those countries in Asia that 

have agreed to at least cooperate with the overall initiative. 

My bottom line message, I think, Mr. Chairman, is that the 

international structure is still based largely on the nation state 

system, and to the extent that we can reinforce the nation state 

system in order to pursue these goals, as well as benefit from it, 

I think that the counterproliferation initiatives that the Bush Administration is undertaking will serve as a very useful, indeed, I 

think, indispensable element of a comprehensive policy for countering proliferation in all of the important categories that we have 

talked about here today. 

Senator AKAKA. Thank you very much for your statements. 

I have questions for you, Mr. Albright. On June 24, 2003, the European Union issued a document entitled ‘‘Basic Principles for an 

EU Strategy Against Proliferation of Weapons of Mass Destruction.’’ I am certain you are familiar with this resolution. The EU 

detailed a plan of action that called for promoting universal adherence to multilateral agreements relating to weapons of mass destruction and their means of delivery, strengthening the biological 

and chemical weapons conventions, criminalizing the export or 

brokering of WMD related material, and strengthening export regimes, and there are others. 

I would appreciate any thoughts you might have, or any of the 

others might have on the EU plan, either now or for the record. 

Was there, for example, any recommendations you disagreed with? 

The Director General of the International Atomic Energy Agency 

has called for far-reaching changes to the nuclear nonproliferation 

regime, and one particular proposal is to make export controls 

which are now voluntary and legally binding. Again, what are your 

views on this idea, and do you see any drawbacks to adopting it? 

Let me stop with those two, and start with you, Dr. Albright. 

Mr. ALBRIGHT. Thanks. I probably know less about the EU deal 

than you may think. I would say though that I think the EU is trying to put down a marker and a commitment to multilateral solutions, which in general I agree with. I think the idea that is prevalent here of a coalition of the willing driving our foreign policy just 

does not work. I think that has been our experience historically. 

You do need binding commitments that are legally enforceable to 

make progress in these areas, and I think the EU has the right 

idea. 

In terms of export controls, I think I do support trying to create 

a treaty-based system of export controls. I have been evaluating illicit procurement for 20 years, and it is just so difficult to stop it 

with the existing system. People like A.Q. Khan make fun of the 

existing system. You can look in his statements and find how he 

basically says, ‘‘Whatever you do, I will get around it.’’

So I think we need a fundamental restructuring. I think what 

ElBaradei has proposed of a treaty-based system is very sound. In 

my testimony I have tried to convey support for that idea and 

begin to talk about it, particularly where the International Atomic 

Energy Agency is used as the verification and monitoring agency. 

The IAEA exists. It is actively working in this area now, working 

in Libya, Iran, and on the A.Q. Khan network. It probably has 

more expertise about the Khan network than any other body, inVerDate 0ct 09 2002 15:00 Dec 06, 2004 Jkt 095191 PO 00000 Frm 00032 Fmt 6633 Sfmt 6633 C:\DOCS\95191.TXT SAFFAIRS PsN: PHOGAN
29

cluding any government, about what that network was doing. I 

think those kind of activities at the IAEA should be generalized 

and the IAEA given a mandate to actually work in this area of export controls and monitoring. 

Senator AKAKA. Mr. Moodie. 

Mr. MOODIE. Thank you, Mr. Chairman. I think any step that reflects a commitment on the part of states to strengthen our ability 

to deal with proliferation is to be welcome. But I think that we 

have to be cautious in that because it is easy to talk a good game 

and harder to play it. I think that historically we have consistently 

had a problem with the response of the international community, 

including some of our friends in Europe, to problems of noncompliance. I think we have to be sure that the actions of our allies are 

matching their rhetoric when it comes to dealing with some of 

these issues. 

In that regard I think the question of how the Europeans will respond to what we are seeing in Iran is a very interesting case 

study, and how they will play this now that the IAEA has in a 

sense expressed its displeasure at the Iranian experience. What the 

Group of Three will do, what their colleagues in the European 

Union will do, I think is going to be a very interesting measure of 

how seriously they take their nonproliferation responsibilities. 

With respect to export controls, I think they continue to play an 

enormously helpful role in the overall structure of the nonproliferation efforts, but I think particularly in the chemical area and especially in the biological area, I think export controls over time will 

be of diminishing utility. They were created in a world with respect 

to the life sciences and how those sciences are applied commercially 

on a global basis. That is a world that does not exist any more, and 

that world is going to change even further, and therefore, the tools 

we have like export controls that were designed for that different 

world, I think we have to go back and do a very serious examination as to the nature of their utility in this new world. 

Senator AKAKA. Thank you. Mr. Spector. 

Mr. SPECTOR. I guess I would say we have a treaty that requires 

export controls in the nuclear field as well as in the chemical area, 

but let me just talk about nuclear. The Nonproliferation Treaty requires all member states to make any exports of nuclear goods 

under International Atomic Energy Agency safeguards. Thus, there 

is a requirement already that these goods be controlled and that 

certain restrictions apply. The actual list of items that is to be controlled is developed by the nuclear suppliers countries, but it is also 

applied by the Nonproliferation Treaty Exporters Group, and I 

would think that all parties to the Treaty are bound by this de 

facto, if not de jure. There is also now the Resolution 1540, which 

places a mandatory requirement for states to have effective export 

controls on weapons of mass destruction related materials and 

equipment. 

I think if you combine the two of these you have a treaty-based 

system for virtually all states, with the handful of exceptions of the 

countries that are not in the Nonproliferation Treaty. But even 

they are now required, under Resolution 1540 to be mindful of 

their exports. So I do not know that we want to take this that 

much further. I think the IAEA has an awful lot to do right now 

30

just trying to manage its safeguards mandate and get this extended with the Additional Protocol and some of the other measures. So I would be hesitant to propose that it take on a major new 

initiative that would involve a new treaty. I think we would be better off working with the tools that are now in hand, including the 

treaty-based tools that I mentioned. 

Senator AKAKA. Mr. Spring. 

Mr. SPRING. I pretty much agree with what has been said here 

so far, both with regard to the European initiative and with regard 

to some sort of new treaty-based regime on export controls. 

I just have one comment or observation as it relates to the latter 

issues on export controls, and that is, that if we go down this road, 

we have to recognize that there are weaknesses in what I call the 

‘‘least common denominator’’ decisionmaking process, especially 

with broad-based multilateral institutions. And to the extent that 

we fail to recognize that within these institutions—Iran, for example—is still for all intents and purposes a member in good standing 

of the IAEA, that we will lose sight of some of the other effective 

measures, I think that we can take, that would be among those 

narrower coalitions that are the subject of the administration initiatives, including the PSI. 

Senator AKAKA. I have other questions for you, and I know the 

time is late, and I know we have delayed you here tonight. I would 

ask that we place these questions in the record for you, and you 

can respond to us. At this time I would want to keep the record 

open for additional materials until close of business next Wednesday, June 30. 

I want to thank you for your knowledge in these areas, and for 

your responses that will be helpful to us. 

So I would like to conclude with this panel. I want to thank you 

very much for your participation here, and look forward to being 

in contact with you again. 

If there is no further business, then on behalf of the Chairman, 

Senator Fitzgerald, the hearing is adjourned. 

[Whereupon, at 6:16 p.m., the Subcommittee was adjourned.] 

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