Overall policy direction for the TC program is set by IAEA’s policy-making bodies—the General Conference and the Board of Governors. The United States is a permanent member of the Board of Governors, which typically meets 5 times per year. IAEA’s Secretariat—led by a Director General and structured into six functional departments—is responsible for implementing policies established by the Board of Governors and the General Conference. The Department of Technical Cooperation, which is headed by a Deputy Director General, is structured primarily around four regional divisions: Africa, Asia and the Pacific, Europe, and Latin America and the Caribbean. The department also includes a Division of Programme Support and Coordination, which is responsible for developing TC program strategies, communications, and partnerships, and managing relevant information systems and TC financial resources. In addition, an external auditor and IAEA’s Office of Internal Oversight Services conduct annual audits and reviews of the TC program. Several individuals are involved in the TC project team responsible for developing and overseeing the project. The team includes (1) a project officer within the TC Department; (2) a technical officer from each relevant IAEA department (such as the Department of Nuclear Sciences and Applications); and (3) a national liaison officer at the country level who represents the member state, serves as coordinator for TC projects in the host country, and acts as liaison with host country governments and institutes. Typically, the TC program develops and approves new projects on a 2-year cycle. The most recent set of new proposals were approved in fall 2008. Member states begin submitting project proposal concepts to IAEA in September of the year prior to approval. IAEA officials screen concepts through the fall, and member states develop and refine their proposals through March of the approval year. By July, IAEA’s Secretariat comes to a final agreement on TC project proposals that it will back for approval by the Technical Assistance and Cooperation Committee and the Board of Governors. The TC project proposals are discussed with member states in bilateral and regional group meetings during IAEA’s General Conference, which is held in September; in November, the Technical Assistance and Cooperation Committee and the Board of Governors give final approval to the proposed TC projects. Neither the United States nor IAEA seeks to systematically limit or deny TC assistance to countries designated as state sponsors of terrorism, even though under U.S. law these countries are subject to sanctions. In addition, TC assistance has been provided to countries that are not party to the NPT, and neither the United States nor IAEA has sought to exclude these nations from TC assistance. Finally, while the United States has encouraged IAEA to condition TC assistance to countries according to their safeguards status, IAEA does not take this factor into account when allocating program funds. Appendix II provides more detailed information on the states and territories that received TC assistance in 2007. Countries deemed by State as state sponsors of terrorism—meaning the Secretary of State has determined that the countries’ governments have repeatedly provided support for acts of international terrorism—have been provided nuclear equipment and other assistance through the TC program. The United States has designated four countries—Cuba, Iran, Sudan, and Syria—as state sponsors of terrorism, pursuant to several U.S. laws. According to our review of IAEA data and financial records, 111 TC projects were approved for these four countries from 1997 through 2007, and they received approximately $55.7 million in TC assistance over that period. These projects ranged across a number of areas, from applying nuclear technologies to treat diseases and improve crop productivity to assisting nuclear power development. Table 1 shows the dollar amount of TC assistance each U.S.-designated state sponsor of terrorism received from 1997 through 2007. According to State, the United States has applied several types of sanctions to these four countries, including restrictions on U.S. foreign assistance, a ban on defense exports and sales, certain controls over exports of dual-use items, and miscellaneous financial and other restrictions. These sanctions notwithstanding, direct U.S. nuclear trade with these countries involving the types of technologies provided by the TC program might not be permitted under U.S. adherence to other international nonproliferation controls. For instance, in a 2007 report to Congress, State concluded that three TC projects involving technology transfer for the operation and maintenance of the Iranian nuclear power plant at Bushehr could be subject to multilateral export controls if Iran were to procure such technology directly from suppliers. The State report noted, “nder the Nonproliferation Principle of the NSG [Nuclear Suppliers Group] Guidelines the United States and other responsible members of the NSG would deny such direct transfers.” The United States has not sought to systematically exclude or limit the four U.S.-designated state sponsors of terrorism from TC assistance. State officials told us that the department would not recommend withholding U.S. funding to the TC program because of the support that IAEA provides to these four countries. They said that it is a long-standing department policy to pay the full share of U.S. support to the TC program because doing so helps maintain international political support for and participation in IAEA, including international support for safeguards. In addition, because TCF resources are fungible, State officials asserted that withholding U.S. contributions to the TCF to punish state sponsors of terrorism would have no practical impact on the TC funding these nations receive. A U.S. Mission official told us that once the United States provides its contribution to the TCF, it cedes control over how the funds are disbursed by IAEA. Several laws govern U.S. support to the TC program. One restriction under these laws prohibits U.S. funds contributed to IAEA from being used for projects in Cuba, except in certain circumstances. Accordingly, State withholds a portion of its voluntary contribution to the TCF equal to the U.S. proportionate share of the TC program’s expenditures in Cuba. In the past, the United States also withheld a proportionate share of its TCF contribution for Iran, Libya, and Territories Under the Jurisdiction of the Palestinian Authority. State also must report annually to Congress on all IAEA programs or projects in certain countries, including Burma (Myanmar), Cuba, Iran, North Korea, and Syria. IAEA officials told us that the TC program does not attempt to exclude countries on the basis of their status as U.S.-designated state sponsors of terrorism or other political considerations. Under the TC program’s guiding principles, for example, the provision of TC assistance is not subject to any political, economic, military, or other conditions that are inconsistent with IAEA’s statute. Moreover, according to the Deputy Director General for the TC program, requests for TC assistance are evaluated strictly on technical merits and the contributions of proposed projects to a nation’s development priorities, subject to the conditions of the IAEA statute, IAEA guiding principles and operating rules pertaining to technical assistance, and any relevant decisions by the Board of Governors and the UN Security Council. This official added that the program seeks to include as many countries as possible and that “there are no good countries and there are no bad countries” participating in the program. In her view, denying or limiting participation of member states in the TC program was a matter for the Board of Governors to consider. Other IAEA officials told us that under the agency’s statute, IAEA’s Secretariat is powerless to limit or condition TC assistance to specific countries, even in cases where countries have been deemed by the Board of Governors to be violating their IAEA obligations or in cases where recipient countries were suspected of being engaged in undeclared, clandestine nuclear activities. For instance, the Board of Governors determined in September 2005 that Iran had breached its safeguards obligations and was not complying with IAEA’s statute. However, TC projects in Iran were not restricted until February 2007 following a UN Security Council resolution on Iran’s nuclear activities. In addition, in 2008, IAEA’s Director General stated it would be inappropriate to block approval of a TC project in Syria for a nuclear power plant feasibility study before IAEA verified claims concerning Syria’s alleged construction of an undeclared nuclear reactor. According to State officials, several countries, including the United States, asserted that the approval of this project would be “wholly inappropriate” when Syria had not provided all of the cooperation required by IAEA to investigate these allegations. IAEA’s Board of Governors ultimately approved the project in November 2008. The United States did not attempt to block approval of the project after receiving assurances that IAEA would monitor the project closely, report as appropriate, and ensure that any equipment provided under the project would be used only for the intended purposes. Finally, in addition to providing assistance to the four countries the United States has designated as state sponsors of terrorism, the TC program has also provided nuclear technology and expertise to other countries that the United States has sanctioned or taken other punitive actions against. Examples of such countries and the total amounts of TC assistance provided to them from 1997 through 2007 include the following: Approximately $7.3 million for Burma, which is subject to targeted U.S. trade, financial, and other sanctions. The Secretaries of State and of Energy have declared jointly that the development of nuclear infrastructure of any kind in Burma would be inappropriate. TC projects have been approved for Burma to improve nuclear instrument repair and maintenance services, enhance pest control, and apply nondestructive testing techniques in construction projects. Approximately $9.7 million for Belarus, which the United States has characterized as “a regime of repression in the heart of Europe” and against which the United States has imposed targeted financial sanctions and travel restrictions.