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Mr. Chairman and members of the Committee, I appreciate the opportunity to testify before you on the subject of U.S.-Chinese nuclear trade.
The Clinton administration clearly hopes to implement the 1985 agreement for peaceful nuclear cooperation with China, possibly announcing its intention to make the necessary certifications during the state visit of President Jiang Zemin this month. The question for Congress is whether President Clinton can make the certifications that are required under U.S. law to implement the agreement.
Briefly, these certifications are:
- That the visits and exchanges to be negotiated under Article 8 of the agreement are "designed to be effective" in ensuring that U.S. exports will be used strictly for peaceful purposes;
- That based on all information available to the U.S. government, including current assurances from Chinese leaders, China is not assisting any non-nuclear weapon state to develop nuclear weapons; and
- That the obligation in Article 5 of the agreement to consider Chinese requests to alter U.S.-origin materials "favorably" will not prejudice U.S. decisions.
These certifications are required under P.L. 99-183, which Congress approved in December 1985. Because of China's past nonproliferation record, no administration to date has been able to make these certifications.
After the Tiananmen Square demonstrations in 1989, Congress passed additional legislation which suspended nuclear trade with China under the agreement for cooperation until the President certifies that China is not assisting and will not assist non-nuclear weapon states in acquiring nuclear explosive devices or materials.
As recently as mid-September, administration officials acknowledged that China had not met all of these requirements. It is an open question whether China will do so by the time of the summit, and the situation will probably not be resolved until President Jiang's visit. I would like to suggest some guiding principles for addressing this issue, followed by specific recommendations.
As guiding principles, I offer the following:
- First, China is key to U.S. nuclear nonproliferation policy in many ways: as a nuclear weapon state, as a permanent member of the U.N. Security Council, as an important supplier country, and as a major regional power in Asia. It makes sense for the United States to engage with China on this issue, and to offer positive incentives -- such as peaceful nuclear trade -- for China to improve its policies.
- Second, nonproliferation should be the main criterion for deciding whether to implement the agreement. There are other significant issues involved, including jobs and revenue from nuclear exports, and the need to reduce China's greenhouse gas emissions (which reflect its dependence on coal). But security should come first. The United States spends many tens of billions of dollars every year to promote its security interests in Asia. Preventing further spread of nuclear weapons in this region is more urgent than exporting nuclear reactors.
- Third, many U.S. officials have worked hard for years to improve China's nuclear nonproliferation behavior, and they have made important progress. The decision of whether and when to certify China for nuclear trade involves a delicate balancing act. On the one hand, there are some key issues on which the United States should not accept less than 100 percent cooperation from China. On the other hand, if the United States adds new conditions for certification at this point which China is unlikely to accept, we risk losing tangible commitments from China, and may jeopardize opportunities for further progress. It is important to avoid making the perfect the enemy of the good.
- China must terminate its supply relationships with unsafeguarded facilities in Pakistan and with Iran, and adhere to its May 1996 pledge not to make exports to any unsafeguarded nuclear facilities. China's sales to Pakistan and Iran are its most blatant problem areas in the nuclear field, and the United States should not accept any murkiness here. China must end all direct and indirect assistance -- including both equipment and personnel -- to unsafeguarded facilities in Pakistan, particularly the nearly complete plutonium production reactor at Khusab. The administration is pushing China to terminate all of its supply relationships with Iran, even to safeguarded facilities, because the U.S. government believes that Iran is seeking to develop nuclear weapons. Therefore, any Chinese nuclear exports to Iran -- even to facilities subject to inspection by the International Atomic Energy Agency (IAEA) -- would contribute to Iran's weapons program, thus violating the Clinton administration's criteria for certification.
- The United States should obtain tangible evidence that China's new export control system is complete enough and effective enough to work in practice. The new Chinese export control regulations that were announced last month focus on specialized nuclear technologies; they do not extend to "dual-use" goods, that is, items that have both commercial and military applications. The Chinese government issued a directive on dual-use exports earlier this year, but it is still developing regulations to control them. Iraq's clandestine nuclear weapons program showed the need for effective controls on dual-use technologies that can be used to produce nuclear bombs. The administration should not certify China for nuclear trade without strong evidence that China has the intent and the capability to control both specialized and dual-use technologies that have nuclear weapons applications. When the United States assesses whether to support countries for membership in the Australia Group and the Missile Technology Control Regime, we look for patterns of behavior over time which indicate whether there have been major deviations from a country's legal controls on chemical, biological, and missile-related exports. There is no reason to ask less from China in the nuclear area.
- Congress should require a clear statement from the administration of China's intentions about requiring full-scope safeguards as a condition for export, and of what the administration plans to do to move China in this direction. China is the only major nuclear supplier country that does not currently require full-scope safeguards as a condition of supply. This step, which Chinese leaders have resisted, is not legally required for certification. However, China recently announced its intent to join the Zangger Committee, which regulates exports of nuclear fuel and equipment, and which is expected to adopt such a policy within three years. Conceivably, China could block the Zangger Committee's move to require full-scope safeguards, since that organization makes decisions by consensus. It is also possible that once China joins the Zangger Committee, it will come under strong international pressure to adhere to the same standards as all of the other members; indeed, some countries have already raised this issue with China. Congress should press the administration to develop and pursue a clear strategy on this issue, including enlisting major supplier countries that are Zangger Committee members to help convince China that it should require full-scope safeguards.
- Congress should ask the administration for detailed information on what verification arrangements the United States will require on nuclear exports to China. The agreement for cooperation contains only vague language about what the United States will do to make sure that nuclear exports to China are used solely for peaceful purposes. What has the administration agreed on with China in terms of end-use checks, inspections, or other processes for verifying that this is the case? As the committee knows, China has recently diverted other U.S. exports -- namely, advanced machine tools and a supercomputer -- from their authorized users to military facilities. It has also resisted U.S. end-use checks on missile-related exports. How does the Clinton administration propose to avoid similar problems in monitoring nuclear exports?
- Congress should look critically at the likely trade benefits from U.S. nuclear sales to China. China will make big investments to meet its energy needs in the coming decades. However, Beijing clearly wants Chinese companies to produce a growing percentage of the power plants that it plans to build. In addition, China faces difficult choices between expanding its nuclear capacity and investing in other options, such as coal, natural gas, renewables, and increased energy efficiency. It is unclear how rapidly China can safely expand nuclear power generation -- especially since safety depends not only on the technology that China uses to produce power, but on training competent people to operate it. In sum, there are major export opportunities for the United States in China's energy sector, but the action is not limited to nuclear power, and U.S. energy exports to China do not hinge solely on the fate of this agreement. Many organizations are studying China's energy future, including the World Bank, the National Academy of Sciences, and Lawrence Berkeley Laboratory. I urge the committee to hold further hearings with input from these experts to examine all of the commercial, environmental, and other implications of China's energy choices.
I believe that progress on nonproliferation is the right answer -- but I also think there are limits on what the United States is likely to achieve in the context of this certification decision. Some experts have argued that the United States should require the Chinese to take additional steps before the President certifies China for nuclear trade. Many of these goals are important and worth pursuing, such as persuading China to require full-scope IAEA safeguards as a condition for nuclear exports; to allow the IAEA to safeguard U.S. exports to China; and to refrain from developing a civil plutonium stockpile. These are valuable goals, but if the United States makes them conditions for certification now -- when they have not been part of the last twelve years' negotiations -- it may lose the chance to nail down real progress with China on issues that U.S. leaders have been pursuing with Beijing for the past decade.
This tradeoff is especially complex with respect to getting China to require full-scope safeguards as a condition for exports, which should be a high-level U.S. goal in the near term. Congress can play an important part by keeping pressure on the administration to pursue it. China's commitment to join the Zangger Committee has effectively committed Beijing to make a decision on this issue within three years. Based on my discussions with administration officials and scholars who are watching this issue closely, it appears likely that China will refuse to adopt a full-scope safeguards policy now, but may agree to terminate all of its support for unsafeguarded facilities in Pakistan and its nuclear trade with Iran, as the Clinton administration is urging. If the President makes a certification under these conditions, one option for Congress would be to accept that certification (providing it meets all legal criteria), but to require that no new contracts could be approved after the year 2000 unless China adopts a full-scope safeguards export policy by that date along with the rest of the Zangger Committee. This approach would recognize China's steps to date, while putting Beijing on notice that the United States will be looking for further progress. It also would give ammunition to the agencies within the Chinese government that support tightening China's trade controls.
Beyond the full-scope safeguards issue, if the United States moves the goalposts for certification now, we could lose some valuable opportunities to work with China on other key arms control issues. For example, China needs assistance and training to build an effective export control system. U.S. experts have held a technical working session with Chinese counterparts on this issue, and negotiations are in process on a government-to-government agreement for the United States to assist China in building up its export controls (as we are doing in Russia and the former Soviet republics). If the administration plays its cards well, it can use certification to gain information and access to China's export control system. This will help U.S. experts to assess how well those controls will work and to anticipate the most likely problem areas.
The Department of Energy and U.S. national laboratories also want to work with China on other problems, such as fissile material security and accounting, and reducing the use of highly enriched uranium in civilian reactors. Chinese officials are interested in working on these issues, but their overriding priority is to implement the nuclear trade agreement. This does not mean that we should cut corners on certification, but it does suggest that implementing the nuclear trade agreement under appropriate conditions will open the door to further bilateral cooperation that is in our national security interest. Senior experts at the DOE weapons laboratories want to pursue these opportunities because they believe it is important to help create a safeguards culture in China now, while the country is opening up to outside influences but before the totalitarian control system over nuclear materials comes undone. We are trying to do this job after the fact in the former Soviet republics -- a much harder challenge.
Conclusion
In conclusion, I recommend that the Committee work closely with the administration over the next several weeks to reach agreement on the areas that are essential for certification:
- cessation of Chinese support for unsafeguarded nuclear facilities in Pakistan, and of all nuclear cooperation with Iran;
- concrete evidence that China has established working nuclear export controls, including controls on dual-use goods;
- effective measures to ensure that U.S. exports to China are used solely for peaceful purposes; and
- the other reports and certification that are legally required to implement the 1985 agreement.
I also urge the Committee to keep the big picture in mind. China has come a long way from the days when it openly supported nuclear proliferation, but it has farther to go. Beijing will need U.S. assistance to make further progress, and it is in our interest to provide that help, without minimizing our differences. It took the United States many years to persuade close allies, such as Germany and France, to take some of the same steps that we now want China to take. U.S. persistence paid off in those cases, and we should be willing to make the same investment in working with China.
Thank you, and I look forward to your questions.
This
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