U.S. Renews Effort to Bring China into Missile Control Regime

March 1998

By Howard Diamond

The Clinton administration dispatched two officials to Beijing in late March to measure Chinese interest in joining the Missile Technology Control Regime (MTCR), an informal suppliers arrangement designed to stem the proliferation of ballistic missiles and their associated technologies. Acting Undersecretary of State John Holum and Deputy Assistant Secretary of State Robert Einhorn held talks with Chinese officials March 23-24 and 25-26 respectively, to determine if Beijing would be willing to expand its 1994 pledge to not sell complete ground-to-ground missile systems to include transfers of cruise missiles and materials and technologies listed in the MTCR's technical annex. China has traditionally shown little interest in informal arrangements like the MTCR.

The 29-member MTCR limits sales of missiles and missile technology for systems capable of delivering a 500-kilogram payload 300 kilometers or more, and plays a key role in controlling participation in the international space industry. MTCR members, who dominate the space market, limit their space cooperation with states that are not members or have not promised to abide by the regime's rules. Members base their missile export policies on the regime's guidelines, which call for a presumption to deny transfers of whole missiles and missile sub-systems (Category I), and the exercise of restraint in sales of missile-related materials and technologies (Category II) that are specified in the annex. The regime forbids transfers of complete missile production facilities. Washington is hoping to persuade Beijing to join the MTCR by emphasizing the benefits of increased access to U.S. satellite payloads for Chinese boosters. Each satellite launch can be worth between $40 million and $100 million.

According to a National Security Council memo leaked and reprinted in The Washington Times on March 23, the Clinton administration wants Beijing to establish effective export controls for missiles and missile technology, including so-called "catch-all" restrictions; end MTCR-controlled exports to all non-member states; and cut off all cooperation with Iran's ground-to-ground missile programs, including systems not covered by the MTCR's limits.

In exchange, Washington would support Chinese admission into the regime; conclude a peaceful and scientific space cooperation agreement with Beijing; issue a blanket waiver of Tiananmen Square sanctions relating to satellite launches; and increase the number of U.S. satellites that could be launched on Chinese rockets.

In January, Beijing promised to end its sales of anti-ship cruise missiles to Tehran. However, Washington is still concerned about allegations that China is providing assistance to Iran's 1,300-kilometer Shahab-3 and 2,000-kilometer Shahab-4 missile programs. The Clinton administration imposed missile-related sanctions on China in Augut 1993 for selling M-11 missiles to Islamabad, but lifted them in October 1994 after Beijing agreed to abide by the MTCR guidelines and not sell Category I items.

Beijing's subsequent compliance with the MTCR's rules has been questionable. In April 1997, Einhorn testified before a Senate panel that "the Chinese do not appear to interpret their responsibilities under the guidelines as restrictively as we do, or as other MTCR members do." 

Nuclear Sale to Iran Blocked

Washington's interest in bargaining over missile proliferation was previewed last fall when President Bill Clinton declared that he would put the long-dormant 1985 Sino-U.S. nuclear cooperation agreement into effect. Clinton based his decision on improved Chinese non-proliferation practices and a written pledge offered during his October summit meeting with Chinese President Jiang Zemin that Beijing would end its nuclear cooperation with Iran. On March 18, 30 legislative days after the administration submitted the necessary reports and certifications to Congress, the nuclear deal went into effect.

Near the end of the congressional review period though, the Senate Foreign Relations Committee held a closed hearing on March 12 to review intelligence revealing Iranian efforts to purchase anhydrous hydrogen fluoride (AHF) from China's state-owned nuclear technology firm. According to intelligence leaked to The Washington Post, the National Security Agency intercepted two telephone calls in mid-January between a senior Iranian official at the Isfahan Nuclear Research Center and a mid-level official at the China Nuclear Energy Industry Corporation. The two reportedly negotiated the price and quantity of the purchase as well as discussing preparation of a cover story and falsified "end-user" documents. AHF, also known as hydrofluoric acid, has many common industrial uses, but is a key ingredient in the conversion of uranium ore (known as "yellow cake") into a gaseous form (uranium hexaflouride) suitable for enrichment.

Clinton administration officials intervened in early February, sending a demarche from national security advisor Samuel Berger to his Chinese counterpart, Liu Huaqiu, and calling Beijing's ambassador in for a meeting with National Security Council official Gary Samore and Einhorn.

Beijing reportedly protested that AHF does not appear on the control lists of either the Nuclear Suppliers Group or the Zangger Committee, but did assure Washington that the sale would not take place, reflecting the importance China associates with the nuclear cooperation agreement.

According to a State Department official, the AHF incident is only the latest event in Iran's continuing effort to acquire Chinese materials and technology for its clandestine nuclear weapons program. The official said formal contacts to block such sales are common, but he added, "[W]e have reason to know that the Chinese government has taken some actions to generically stop these transactions."

A majority staffer on the Senate Foreign Relations Committee is less convinced. Pointing to the AHF case and the 1995 ring magnet episode, the staffer complained that the administration "has a pattern of avoiding sanctions by saying 'these are renegades, the government didn't know about it, and they acted when we told them.'"

Unable to block the nuclear cooperation agreement from taking effect, some congressional Republicans are attempting to draft newrules for nuclear technology exports in order to keep a closer watch on China's proliferation practices. Hoping to imitate the Arms Export Control Act that provides members of congress with a formal process for reviewing weapons exports, Senator Jesse Helms (R-NC) and Representative Benjamin Gilman (R-NY) the chairmen of the two foreign affairs committees attempted on March 12 to include new nuclear export rules in the conference report for the State Department authorization bill. Faced with uniform Democratic opposition and a request from the majority leadership, Gilman and Helms pulled the measure but promised to bring the issue up again later this year.