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C O N F I D E N T I A L SECTION 01 OF 10 TOKYO 005492 
 
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DEPT FOR ISN THY NGYUEN 
DEPT FOR EAP/J JESSICA WEBSTER 
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E.O. 12958: DECL: 12/05/2017 TAGS: ENRG KNNP MNUC PARM PINS PTER TRGY KGIC IAEA

1.(C) Summary: Acting Under Secretary of State for Arms Control and International Security, John C. Rood, led the U.S. delegation to the tenth U.S.-Japan Commission on Arms Control, Disarmament, Non-Proliferation and Verification on November 8 in Tokyo. The Commission meeting made clear that Japan shares a common view on important areas in nonproliferation and will continue to be a strong ally. The meeting covered a wide range of issues, including North Korea and Iran; the Proliferation Security Initiative (PSI) and proliferation finance; disarmament and non-proliferation issues; U.S.-India Civil Nuclear Cooperation; the Global Initiative to Combat Nuclear Terrorism (GI); and the Global Nuclear Energy Partnership (GNEP). End Summary.

Opening Remarks ---------------

2.(C) Following brief introductions by Acting U/S Rood and head of the Japanese delegation MOFA Director-General for Disarmament, Non-Proliferation and Science Ambassador Takeshi Nakane, Acting U/S Rood began by highlighting the broad range of important issues on the Commission's agenda and pointing out the last scheduled Commission meeting one year ago was cancelled due to the press of business following the October North Korean nuclear test. Representing the U.S. at the Commission meeting for the first time, Acting U/S Rood noted the close cooperation with Japanese counterparts he had enjoyed while working missile defense issues in his earlier work at DOD. Nakane noted Japan,s position on arms control and non-proliferation often very closely tracked with that of the U.S., and added while the Japanese people have a strong aspiration for nuclear disarmament that occasionally leads to some difference of views, these differences should not undermine our close bilateral security. Stressing this latter point, Nakane stated the U.S. and Japan must strive to contain discussion of such divergent issues at the UN General Assembly lest they disturb the U.S.-Japan relationship.

North Korea -----------

3.(C) Nakane stated that the Six-Party process would enter an important phase toward the end of 2007, with North Korea implementing its commitment to disable its nuclear facilities and to make a complete and correct declaration of its nuclear programs. Noting with approval President Bush's public references on October 3 and October 17 to the need for North Korea to dismantle its nuclear programs and declare its nuclear activities, Nakane pointed out the importance Japan attaches to ending North Korea's uranium enrichment program. Although the current focus is on three critical facilities at Yongbyon, the DPRK must disable all nuclear facilities. Nakane added the GOJ is working on the schedule for Japanese nuclear experts to join the U.S. team in Yongbyon toward the middle of November, and that Japan is coordinating the details with U.S. counterparts. Nakane hopes disablement would happen in the context of the Six-Party Talks and ROK, China, and Russia would also participate in the disablement process. However, Nakane added the GOJ had learned Russia and China were not interested in participating in disablement at this time. Nevertheless, the GOJ intends for Japanese and ROK experts to join the U.S. team, Nakane stated.

¶4. (C) Nakane continued conveying Japan's concern about a possible Syrian-DPRK proliferation link, calling it a very serious issue for peace and stability, as well as for the global non-proliferation regime. If reports of DPRK nuclear proliferation to Syria were true, Nakane asserted, then the Six-Party framework must deal with the issue. However, TOKYO 00005492 002.2 OF 010 Nakane added Japan had little information on this topic and he asked the U.S. to provide information on the Syria connection in particular and on DPRK proliferation activities in general.

¶5. (C) Turning to IAEA involvement in the DPRK disablement, declaration, and verification process, Nakane stated Japan's understanding that North Korea has not been negative toward ongoing IAEA inspection activities, and stated continued IAEA involvement is very important. According to the Japanese delegation to the IAEA, the Agency is frustrated because the role the agency should play in disablement is unclear. Nakane highlighted the urgent need for the Six-Party Talks to establish links between the denuclearization process and the IAEA role, underscoring Japan's position that the IAEA is indispensable in the process and the six parties should issue clear guidance on IAEA participation.

¶6. (C) Concluding his remarks on North Korea, Nakane noted Japan's contribution of 500,000 USD to support the special activities of the IAEA in North Korea, and he explained the GOJ is now examining ways to make further contributions to the denuclearization process. Nakane noted that the DPRK missile issue remains a serious matter for the world and it is imperative to deal with the issue within the Six-Party process in the future.

¶7. (C) In response, Acting U/S Rood noted the time would soon come to test DPRK intentions. Pointing out that the DPRK had in the past reversed steps to freeze nuclear facilities, Acting U/S Rood stated in the next phase, North Korea's willingness and commitment would be put to the test. The U.S. hopes for the disablement of core facilities at Yongbyon by the end of 2007, Acting U/S Rood said, and the U.S. also believes the DPRK declaration should include uranium enrichment. However, North Korea continues to deny the existence of a uranium enrichment program.

¶8. (C) Acting U/S Rood briefly summarized the September visit of nuclear experts to North Korea, the negotiation of disablement steps, and the subsequent positive movement, with the U.S. nuclear team now on the ground in North Korea reporting good cooperation.

¶9. (C) Acting U/S Rood pointed out the U.S. had set aside about USD 20 million from the Non-Proliferation and Disarmament Fund to finance disablement in North Korea, adding the U.S. would like to talk to other Six-Party countries to assist in additional financing. In response to DG Nakane's comments on IAEA involvement, Acting U/S Rood stated the U.S. view is similar to the GOJ,s and too regards the IAEA as indispensable. Acting U/S Rood affirmed that North Korea has not been as negative toward the Agency, and that U.S. anticipates it will be the primary mechanism by which to monitor the shut-down of DPRK nuclear facilities. Acting U/S Rood called attention to the one caveat that, in the area of nuclear weapons themselves, there are restrictions on IAEA access to nuclear-weapons design information. South Africa, he noted, is a successful instance of nuclear weapons disposal under IAEA supervision with involvement from P5 states.

¶10. (C) Bringing the exchange on North Korea to a close, Acting U/S Rood said there is no news on the delisting of the DPRK as a state-sponsor of terrorism. The Acting U/S clarified the President can begin rescission of a country's designation by notifying the Congress of his intent to do so. If within 45 days no action is taken by Congress, the President has the authority to take such action, though the country is not automatically removed from the list. A country is de-listed only when the Secretary of State TOKYO 00005492 003.2 OF 010 formally executes such action at the President's direction.

Iran ----

¶11. (C) Turning to Iran, Acting U/S Rood stated the U.S. is increasingly concerned about steps Iran has taken to boost its nuclear capabilities, stressing profound concern over the possibility of a nuclear-armed Iran. He noted it is a bad assumption to think Iran would behave similarly to the other states that have acquired nuclear weapons thus far. Acting U/S Rood stressed the magnitude of this security challenge and explained Iran achieving a capability to produce fissile material would place it on a glide path to a nuclear weapon. He stated the U.S. wants to avoid having to choose between two terrible outcomes, namely Iran with a nuclear weapon or military options. The U.S. is concerned Iran is using the IAEA to shield itself from UN action, and that IAEA DG ElBaradei does not share our apprehensions regarding Iran. At the same time, Acting U/S Rood pointed out, the U.S. is open to face-saving measures should Iran undertake a full suspension of its nuclear activities.

¶12. (C) Acting U/S Rood stated it is difficult to know the status of Iran,s centrifuge operation, as the GOI has tried to create "facts on the ground" for political reasons. However, while Iran is no doubt exaggerating its progress, Iran is making progress, which is of concern to the U.S. Acting U/S Rood outlined the several approaches the U.S. is pursuing. First, within the Nuclear Suppliers Group, the U.S. is discouraging other supplier countries from conducting any nuclear business whatsoever with Iran and a U.S. effort is underway to sensitize other countries to the dual-use nature of many petroleum-sector goods. Second, on the Security Council track, if the next ElBaradei report does not show clear suspension, then the U.S. will push for a third UNSC resolution. (Acting U/S Rood noted the Political Directors meeting the previous week did not go well, as Russian and Chinese views have hardened and the two countries are opposing further steps.) Third, the U.S. recently took further steps on the financial front, designating the IRGC, the Quds force, three major Iranian banks, and a number of IRGC-owned companies for involvement in terrorism or proliferation-related activity. In concluding his remarks on Iran, Acting U/S Rood stressed the U.S. is encouraging all countries to reduce export credits to Iran, and he noted current levels of pressure on Iran are not sufficient to compel the GOI to come to the negotiating table.

¶13. (C) Nakane responded Japan is also pessimistic about Iran and hopes to avoid the two extreme outcomes described by Acting U/S Rood. Nakane stated Iran's implementation of the Additional Protocol would be desirable, that it is important for the international community to be united in increasing pressure on Iran, the GOJ believes it is important to adopt another UNSC resolution, and that Japan hopes Iran will return to the EU 3 3 negotiation. Nakane added Japan maintains good contacts, even at the ministerial level, with Tehran and at every opportunity encourages Iran to suspend its nuclear activities. Iran, however, has not been receptive.

¶14. (C) Noting Japan has faithfully and completely implemented UNSC resolutions 1737 and 1747, Nakane pointed out China in 2006 overtook Japan and is now Iran,s number one trading partner. Nakane, adding Japanese banks refrain from new transactions with Bank Sepah and Bank Saderat, stated "Japan will not sacrifice its non-proliferation policy for economic interest." Promising Japan will continue to exert pressure on Iran to engage in dialogue, Nakane added if Japan suspends transactions with the Iranian Central Bank, it TOKYO 00005492 004.2 OF 010 could have a serious effect on imports of crude oil -- serious not only for Japan but also for more vulnerable Asian countries. Acting U/S Rood clarified that the U.S. is not encouraging Japan to take action against the CBI. Rather, the U.S. is cautioning we must protect the international financial system against Iranian abuses. Acting U/S Rood stressed while China had been able to replace Japan as Iran's number one trading partner in trade volume, on the financial side, Japan is one of very few countries that are major players. Japan therefore can play an important role in exerting financial pressure on Iran.

¶15. (C) Participants briefly discussed proposals for international enrichment centers. Acting U/S Rood noted the U.S. saw merit in the proposal for a Russian enrichment center, with Kazakh participation and an Iranian managerial and financial stake, but barring Iran access to enrichment technology. Iran, however, was not interested in the proposal. In response to a Japanese query, U.S. Senior Advisor Timbie noted the Saudi enrichment center plan was troubling, and not supported by, the U.S., as we do not want to see the spread of this technology to states which do not currently possess it.

Proliferation Finance ---------------------

¶16. (C) Acting U/S Rood reported the U.S. is pleased with the work of the Financial Action Task Force. Nakane asserted Japan will continue to cooperate with the U.S. and other partners on financial enforcement, both from a money-laundering and non-proliferation standpoint. Regarding implementation of FATF recommendations, when queried whether the GOJ had issued an advisory to banks, MOFA Non-Proliferation, Science and Nuclear Energy Division Director Ichikawa replied the relevant authorities were informing banks of the outcome of discussions. Acting U/S Rood responded the USG urges Japan to take steps to financially isolate itself from those entities recently designated by the U.S.

PSI and Outreach Activities ---------------------------

¶17. (C) Nakane thanked the U.S. for sending assets and personnel to the recent PSI exercise hosted by Japan. He said the exercise was a success, having drawn the participation of 40 countries, up from 21 in Japan's previous 2004 exercise. Japan was pleased India, Pakistan, Vietnam, Malaysia, and many Middle Eastern countries sent observers to the exercise. Although Japan repeatedly invited China and South Korea, neither country sent observers. After the exercise, Japan gave a detailed briefing to both, to emphasize that the exercise did not target any particular country. China appreciated these briefings, Nakane said, and he stressed the importance of continuing to reassure China. (Note: During the coffee break of the Commission meeting, MOFA showed a brief video, still in production, on the mid-October PSI exercise. End note.)

¶18. (C) In response, Acting U/S Rood commended Japan for hosting such a large and successful exercise, noting it was particularly gratifying to see India participating as an observer. Acting U/S Rood pointed out 2008 marks the 5th anniversary of the start of PSI, and the U.S. is planning a large celebration in Washington, with the aim of taking the group to a higher level of effectiveness. Nakane, stressing bi-partisan domestic support in Japan for PSI, stated it was necessary to show good examples of PSI results and other success stories beyond the BBC China. Nakane asked the U.S. to supply one or two additional concrete success stories TOKYO 00005492 005.2 OF 010 which would contribute to Japanese support; the U.S. delegation promised to look into the matter and respond.

¶19. (C) Nakane recapped the 4th Asian Senior Level Talk on Non-proliferation (ASTOP) meetings held in January 2007, which included a mock table-top PSI exercise. He stated Japan's intention to host the next ASTOP meetings in April or May 2008. Nakane noted Japan's desire to include an element to deepen Asian countries, understanding of PSI. He said Russia is interested in being invited to the ASTOP meetings, but added his personal concern regarding the Russian attitude toward the export control regime. Pointing to their disruptive behavior when they first joined PSI, Acting U/S Rood noted the U.S. shared Japan's concerns about Russian intentions as well.

Conference on Disarmament -------------------------

¶20. (C) Taking the lead on CD discussions, Acting U/S Rood stated the last year has been the most active in the past decade. Acting U/S Rood said the U.S. supports the L-1 proposal, and the highest priority is to break the deadlock. Pakistan remains a problem, as do China and Iran, Acting U/S Rood explained. Furthermore, Israel does not support the FMCT, but will not openly object at the CD at this time. Acting U/S Rood asserted there needs to be a two pronged approach: 1) a greater focus on China to drop their opposition, by increasing their discomfort especially in the run up to the Olympics; and 2) an attempt to not create further linkages. Acting U/S Rood stressed the U.S. had made compromises, to set the FMCT negotiations in motion. Adding France, UK, and Germany are of like minds, the Acting U/S exhorted coordinated action to highlight Chinese opposition.

¶21. (C) In response, Nakane pointed to Diet references to former Secretary of State Kissinger's WSJ op-ed on disarmament and to the Japanese public,s enthusiasm for eliminating nuclear weapons. While Japan is encouraged by recent signs, Nakane added, the country remains realistic about the security situation. Nakane conveyed Japanese appreciation for U.S. efforts to be forthcoming in the CD and for progress on FMCT discussions. Stressing the FMCT is a top priority of Japan in the CD, Nakane stated the GOJ will continue to push Pakistan, although little change can be expected prior to the election there. Regarding PAROS, Nakane relayed Japanese concern with China's ASAT test and stated Japan believed Russia was not eager to start negotiations on prohibition of space weapons.

¶22. (C) Acting U/S Rood replied the U.S. agreed that the FMCT should be the CD's priority. Regarding Russia's stance on space arms control, Acting U/S Rood suggested the U.S. had a slightly different perspective on Russian interest in this area, as Chinese or Russian interest in such arms control seemed a likely "back-door" approach to limiting U.S. capabilities. Finally, Acting U/S Rood expressed the U.S. concern with the extensive and long-lasting debris cloud caused by the Chinese ASAT test.

2010 NPT Review Process -----------------------

¶23. (C) Touching only briefly on the ongoing preparations for the 2010 Review Conference, Nakane conveyed Japan's appreciation for U.S. cooperation to bring about a successful Revcon. He noted U.S. efforts to explore disarmament measures contributed to a positive outcome to the recent first session of the PrepCom, and noted a time and venue for the 3rd session of the PrepCom must still be decided. On the latter point, Acting U/S Rood replied the U.S. has little TOKYO 00005492 006.2 OF 010 interest in finding a new and more costly venue away from New York, and he dismissed Iranian complaints that restrictions placed on them in New York hampered the discharge of their duties.

NPT Article VI Issues ---------------------

¶24. (C) Turning to NPT Article VI, Nakane opened by expressing Japan's interest in the current state of U.S.-Russian negotiations on strategic-force reduction and by saying Japan had received a demarche from Russia to support INF treaty negotiations. Nakane also conveyed Japanese appreciation of U.S. support in developing the international monitoring system for the CTBT. He added, however, Japan remains concerned that the U.S. contribution be spent in the same areas as in the past. On the UNGA de-alerting resolution sponsored by New Zealand and others, Nakane emphasized Japan continues to rely on U.S. nuclear deterrence, especially given the current unsettled security situation, and noted the U.S. deterrent plays an important role in maintaining peace and stability. He explained Japan,s press closely watches GOJ actions on disarmament and asked for U.S. understanding that Japan's intention is not to undermine the U.S.-Japan security arrangement. Acting U/S Rood subsequently responded while the U.S. understands Japan's position, we would have preferred a GOJ abstention or rejection of the de-alerting resolution. Acting U/S Rood also stressed the U.S. posture has been markedly reduced in recent years.

¶25. (C) On Nakane's queries, Acting U/S Rood reported the U.S. and GOR agreed at the 2 2 in Moscow to support a legally binding START follow-up. While neither party wished to continue with START, the objective is to take the best elements of START, with the goals of stability, confidence, and transparency. Acting U/S Rood cautioned that although the U.S. believes the INF Treaty has been a success, the USG will not launch a global campaign for a global treaty. In conclusion, he thanked Japan for feedback on the U.S. disarmament record, and added a personal comment from his direct experience at the Department of Defense to underscore the deep but often-overlooked cuts in the U.S. strategic arsenal. The United States has not made fissile materials for weapons for decades, and has reduced its nuclear forces to levels not seen since the Eisenhower administration.

Nuclear Suppliers Group (NSG) -----------------------------

¶26. (C) Touching on NSG-related topics, the U.S. delegation argued a ban on the spread of enrichment technologies would make the most sense, even if it would be difficult to persuade all NSG members to join in to such an approach. Timbie underscored the U.S. is not just interested in blocking Iran and North Korea, but in preventing any spread of enrichment and reprocessing technologies to states that do not already possess such facilities. In response, Nakane stated there was no chance to achieve a total ban on transfer of these technologies to other states. Nakane indicated the GOJ had heard of a recent high-level communication from the Canadian government expressing displeasure with this U.S. stance. Nakane added it would be difficult for Japan to continue this approach, and he urged the consideration of alternate strategies. Acting U/S Rood countered that settling for weak criteria would in fact set our efforts back. Ichikawa chimed in that a source of Japanese concern is the current moratorium is non-binding beyond the G-8.

U.S.-India Civilian Nuclear Cooperation TOKYO 00005492 007.2 OF 010 ---------------------------------------

¶27. (C) Acting U/S Rood reviewed the status of the agreement, citing the two key criteria set by the Congress, namely a bilateral agreement between the U.S. and India and a Safeguards Agreement to be concluded between the IAEA and India. In addition the NSG would need to change its rules. Acting U/S Rood pointed to the fluid internal political situation in India, of which the Japanese were well aware, explaining the BJP opposes the agreement on the basis of pure political opportunism, while several Communist parties were against the deal because it would bring India closer to the West and the U.S.

¶28. (C) Nakane responded by conceding there was strong criticism in Japan of nuclear cooperation with India, and noted Japan will closely watch the talks on the IAEA-India Safeguards Agreement. Nakane further suggested a reference to weapons testing might be necessary in the agreement. Although likely premature, Nakane stated Japan also hopes to carry out constructive discussions within the NSG as well.

Preventing WMD Terrorism ------------------------

¶29. (C) Leading off on chemical terrorism, Acting U/S Rood raised U.S. concerns about improvised chlorine gas devices used for terrorist attacks in Iraq. Turning next to bioterrorism, he mentioned U.S. monitoring has shown growing interest in bioterrorism methods among terrorist groups. He added the growth of the biotech industry in Southeast Asia, particularly Indonesia, brings many benefits, but it also makes potential biological weapons more available to Al-Qaida and other terrorist groups. He mentioned that Al-Qaida bioterrorism plans found in Afghanistan revealed greater advances than was previously known. Acting U/S Rood highlighted U.S. efforts on pathogen security, noting the G8 Bioterrorism Experts Group (BTEX) and APEC are promising fora for this initiative. He also mentioned DOS participation in the U.S. Biosecurity Engagement Group, along with HHS, DOA, EPA, and other agencies. Acting U/S Rood noted Japan,s considerable expertise and practical history in the area of chemical and biological terrorism and welcomed Japan,s advanced capabilities in global efforts to prevent terrorist attacks.

Nuclear Terrorism ----------------

¶30. (C) Acting U/S Rood outlined progress expanding the Global Initiative to Combat Nuclear Terrorism (GI), which comprises 62 countries, including all G8 members and 24 of the 27 EU members, as well as the IAEA and EU. He noted Asia is well represented in GI, notably in Central Asia where both Afghanistan and Pakistan are participating. Acting U/S Rood conceded some priority countries, including India, Brazil, Argentina, and South Africa, have not yet joined, but is optimistic they will do so. The U.S. is also encouraging China to contribute more to GI.

¶31. (C) On the future of GI, Acting U/S Rood mentioned the need to deepen the substance of the work, build more capacity among member countries, and expand participation. He noted ideas to put together an experts group for planning GI exercises, and to expand the use of the GI Internet portal, used regularly by around 40 countries, to serve as a platform for collaborative planning.

¶32. (C) Nakane thanked Acting U/S Rood for U.S. efforts to prevent WMD terrorism and highlighted Japanese work with Asian countries on chemical and biological terrorism TOKYO 00005492 008.2 OF 010 prevention. He noted Japan,s support for the upcoming Asia Export Control Seminar that aims to strengthen the capacity of the region,s law enforcement agencies. Nakane also stressed the importance of enhancing the BWC and CWC in the fight against terrorism and voiced support for Iraq joining the CWC.

¶33. (C) Regarding G8 initiatives, Nakane said the GOJ was not in a position to host a BTEX workshop, but will continue to send high-level experts to U.S.-organized BTEX events. Nakane stressed the importance the GOJ places on supporting the GI, noting Japan has hosted seminars on physical protection of nuclear materials and sent vice minister-level officials to recent GI meetings. He underscored the role Japan plays in Asia and the former Soviet Union by providing bilateral assistance to improve physical protection capabilities and encouraging countries to join international conventions. He noted specific GOJ support for IAEA programs in Belarus and Ukraine to improve systems for accounting for nuclear material, and added that Russia, with its strong economy, should step up cooperation with its neighbors.

¶34. (C) Turning to the Radiation Emergency Response Workshop, Nakane announced Japan will send experts to the workshop, noting coordination among GOJ ministries had taken three months. Nakane asked the U.S. to agree not to disclose the existence of the workshop and welcomed U.S. proposals for dealing with sensitivities around the issue. Acting U/S Rood praised Nakane,s announcement of Japanese participation as &very good news,8 adding coordinating among multiple agencies is often challenging. He underscored the value of participation in the workshop and that DOE has particular equipment and procedures to demonstrate. He added the U.S. will give proper sensitivity to the workshop, but the workshop can also send a positive signal to the public that governments are working actively to deter and prepare for a radiation emergency.

Nuclear Energy Cooperation --------------------------

¶35. (C) Nakane began the discussion on nuclear energy cooperation by stressing the importance of a clear G8 message on nuclear safeguards, safety, and security (the 3Ss) to countries that aspire to civil nuclear power. He mentioned Japanese assistance to several countries, including Kazakhstan, where the GOJ is negotiating an agreement for civil nuclear cooperation. He recounted the GOJ,s successful efforts to encourage Kazakhstan to ratify the Additional Protocol as a condition to concluding a bilateral agreement, noting that such an incentive could be useful in dealing with other countries. Nakane also mentioned recent GOJ civil nuclear efforts with Vietnam, which recently announced intention to sign the Additional Protocol. As for civil nuclear cooperation with Indonesia, Nakane said Japan is proceeding carefully, taking into account the political situation and risks of terrorism. Responding to the U.S. position on South Africa,s choice of new reactor design, Nakane said the GOJ must remain agnostic on the reactor design type, as Japanese firms other than Toshiba-Westinghouse are making offers.

¶36. (C) Acting U/S Rood responded the U.S. has no proliferation concerns with regard to South Africa and noted the interest in nuclear cooperation expressed by Indonesia and Vietnam, as well as Egypt and Jordan. Nakane added Bangladesh has ratified relevant treaties and has expressed interest in civil nuclear power, but Japanese companies are less interested in prospects there. Acting U/S Rood expressed skepticism Bangladesh possesses the physical infrastructure and skilled labor necessary to support a TOKYO 00005492 009.2 OF 010 standard-sized nuclear power plant.

¶37. (C) Regarding Russia, Nakane mentioned upcoming meetings with his Russian counterpart, Mr. Kuchinov, on November 9 and 12, to continue the third round of negotiations on a bilateral civil nuclear agreement. He said Russia is showing new flexibility on GOJ demands safeguards apply to a broader range of nuclear activities. Nevertheless, he thinks concluding a final agreement will be a slow process. MOFA International Nuclear Cooperation Division Director Yasuyoshi Komizo added Russia has agreed to apply safeguards to enriched uranium storage facilities, though not to centrifuges. Komizo said Russia could provide 120 tons of nuclear fuel for a reserve at an international fuel center at Angarsk, but the IAEA will insist Russia apply safeguards. Nakane added that as nearly all Japanese nuclear fuel has some U.S. involvement, the GOJ sees a U.S.)Russia agreement as important. Acting U/S Rood said the U.S. has concerns that Russia is not being constructive in work on a UNSC Resolution on Iran and does not plan to move forward to finalize our bilateral nuclear cooperation agreement at this time. However, Russian desires to become a mainstream nuclear supplier, rather than a supplier of &last resort,8 may give the U.S. leverage with Russia on Iran. Komizo agreed Russia has strong aspirations to be a &major league8 nuclear player and needs both U.S. backing and new technology in order to get out of the minor leagues. He added Japan has a unique opportunity to obtain maximum concessions from Russia at this moment, as they are eager to make progress on substantive portions of the agreement before Putin leaves office.

¶38. (C) Turning to the Global Nuclear Energy Partnership (GNEP), Nakane congratulated the U.S. on success at the second GNEP Ministerial. He looks forward to discussions within GNEP on expanding the partnership and assured fuel supply. However, he raised concerns about cooperation on fast breeder reactor (FBR) technology with Russia and China, adding such cooperation should be limited to the U.S., Japan, and France. Komizo said FBR cooperation has been omitted from the scope of civil nuclear agreements with Russia and China. Timbie noted the GNEP Statement of Principles has been drafted to address this concern.

¶39. (C) Acting U/S Rood acknowledged GNEP,s strong momentum and emphasized the need for further discussion on financing for nuclear power in developing countries, particularly through multilateral lending institutions which do not currently finance nuclear power projects.

¶40. (C) Ichikawa raised the issue of assured fuel supply, underscoring both the importance of nonproliferation and the risk of alienating aspirant countries. She suggested a Russia-IAEA agreement for use of the Angarsk fuel center could serve as a model agreement and the U.S. and Japan should have input. Timbie responded the Angarsk concept is a good opportunity to make progress on an assured fuel supply framework and noted the IAEA is unlikely to insist on the Additional Protocol or safeguards as conditions for access. However, he noted suppliers could put more stringent conditions on their contributions, and this could be the beginning of a fuel supply assurance framework.

G8 Issues ---------

¶41. (C) Turning to the G8 agenda under Japan,s presidency in 2008, Nakane highlighted that G8 political discussions would likely include nonproliferation items, particularly relating to DPRK and Iran. He suggested civil nuclear power cooperation be raised in the discussion on environment and TOKYO 00005492 010.2 OF 010 climate change. On the G8 Global Partnership (GP), Nakane said it is premature to try to agree on an extension, but added a consensus is emerging. Arms Control and Disarmament Division Director Yasunari Morino, who participated in the most recent GP working group meeting, added Russia has been more forthcoming on the expanding the GP, but there remains disagreement on how to do so. Russia, Morino continued, prefers a formal procedure, while others prefer a more flexible approach, and is interested primarily in extending the GP to Kazakhstan and other CIS states. Morino said, as G8 Chair, Japan will take a &careful8 approach and will circulate a questionnaire to G8 members to learn more about bilateral efforts and reach consensus.

¶42. (C) Acting U/S Rood voiced support for expanding the GP, but asserted the need to maintain the present structure as the best vehicle for expanding the geographic scope. He encouraged Japan to use its G8 presidency to expand the GP along these lines. Timbie noted the difficulties involved in creating a new entity for the GP, adding that without obtaining additional resources, a new structure would not be productive. Nakane thanked the U.S side for their comments, suggesting the ASTOP meeting would be a good forum to explain the GP and pointing out Japan has several financing schemes for funding cooperation on prevention of nuclear terrorism.

Conventional Weapons --------------------

¶43. (C) Turning to conventional weapons, Nakane said CCW states must come to consensus on the cluster munitions issue. He said an agreement need not be a complete ban and he recognized the need for a transition period. Acting U/S Rood responded the U.S. is willing to work constructively in CCW, but there needs to be real work done. Responding to Nakane,s suggestion Russia be persuaded to join the consensus, Acting U/S Rood said he had sent Moscow,s Defense Foreign Minister Kislyak a letter urging Russia to be supportive at the CCW in lieu of a Norwegian forum.

¶44. (U) This message was delayed in order to obtain Acting Under Secretary Rood,s clearance. 
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