CHEMICAL WEAPONS CONVENTION (CWC): WRAP-UP FOR

1. (U) In part due to the lack of documents and the slimmed
down agenda, the EC-33 Session ended a day earlier than
scheduled and left a number of important issues requiring
attention at the September EC. Along with the U.S., many
delegations highlighted the Technical Secretariat (TS)
problem of late submission of documents. The
Director-General noted this problem in his opening statement
and informed States Parties that he was tasking Deputy
Director-General Brian Hawtin specifically to deal with it.
A number of documents that merited substantive discussion,
and should receive attention at the next session, were only
"received" by the Council vice "noted".



2. (U) The most concrete results came out of discussions
with the Russian Federation concerning conversion requests,
facility agreements and combined plans that were the main
focus of the week (Ref A). Four of Russia's combined plans
for conversion (Lewisite, Sarin, Soman, and Phase II) were
approved as well as the U.S. detailed plan and facility
agreement for Umatilla and the U.S. combined plan for
destruction at Newport. End Summary.



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Annotated Agenda Item Three:
Statement by the Director General


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3. (U) The Director General (DG) highlighted what he sees
as the three most important developments since he took
office: re re-establishing working relations with the States
Parties, resolving the staff tenure issue, and making the
budget process more open and transparent. He briefly touched
on the first two, indicating that progress had been made
toward reforming the bonds of trust between the TS and States
Parties and that the TS was already implementing the recent
EC decision on tenure (staff notifications on one-seventh
turnover for 2003 are nearly complete). The remainder of his
statement focused on budget issues. The TS is taking steps
to put in place a "results based budgeting process."
However, given the lack of technical expertise relating to
this process the 2004 budget was put together using the
previous process. He argued that he had directed his staff
to attempt to achieve zero nominal growth, but that 6.1
percent of the 8.3 percent budget increase the TS is
requesting for 2004 are statutory or fixed increases that are
unavoidable. There were five budget items that he felt it
important to defend (ICA, Travel, Consultants, Training,
Re-activating Posts). In particular, he defended the utility
of the six consultants he is currently using on issues such
as optimization of verification assets, Latin American
Implementation, and Korean Peninsula Implementation. On
Article IV/V payments, he noted 2 ways to resolve this issue:
either the States Parties allow the TS to use budget
surpluses to cover Article IV/V shortfalls or set up an
advance payment system by possessor states. He closed by
stating that he had directed the Office of Internal Oversight
to investigate the reasons behind the delays in TS issuance
of documents and gave a brief description of program delivery
for the past quarter.



4. (U) During the general debate following the DG's
statement the Russian Federation noted that the US had
released $160 million for construction of a destruction
facility a Schuch'ye and stated its intention to destroy the
nerve agent filled munitions from Schuch'ye and Kizner at the
that site. Because of cost and safety considerations, they
intend to neutralize the nerve agent munitions at Pochep,
Leonidovka, and Maradovsky on site which would in Russia's
estimation equal destruction. Finally, Russia indicated that
contrary to a TS report released the prior week Russia had in
fact completed conversion of 15 of the 16 facilities approved
for conversion and they were awaiting certification.
(Subsequent sidebar conversations indicated Russian belief
that rendering facilities incapable of further producing
chemical weapons in fact constitutes conversion.)



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Annotated Agenda Item Four:
Status of Implementation of the
Convention and Related Issues


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National Implementation Measures

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5. (U) The Executive Council (EC) did not task the
Counter-Terrorism Working Group, under its mandate from
EC-XXVII/Dec.5, to develop the Article VII Action Plan per
the instructions of the First Review Conference. Iran,
France and others opposed that proposal. Instead,
delegations accepted report language under "Any Other
Business" that reads:

"The Council noted with satisfaction the outcome of the first
Review Conference and also noted the need for a number of
follow-up actions. The Council decided to include these
various issues in its work program."



6. (U) This leaves the Chairman free to appoint Mark
Matthews of the UK del as facilitator, reporting directly to
the Chairman, for the Article VII Action Plan.



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Optimization of verification activities

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7. (U) The DG made it evident at the margins of and during
the EC that the desire to further optimize resources was a TS
priority, and must be for States Parties too. The DG
acknowledged that States Parties needed to be closely
consulted in moving this initiative forward. A surprise was
the DG's statement suggesting there would be a U.S. visit by
BG Diamantidis, a TS French Consultant for development of a
cost-saving verification concept. BG Diamantidis briefed the
EC on the status of developing a general concept for lowering
costs at CW destruction facilities (CWDF). On the margins of
the EC, Amb. Javits chaired an informal discussion with BG
Diamantidis and Dr. Reeps (Director of Verification) with del
representatives present to discuss our approach and to assist
the TS in its optimization efforts. The Del expressed the
view that, before the U.S. is able to entertain a visit by BG
Diamantidis, it is necessary to determine within the
interagency what the U.S. believes is absolutely required for
verific
ation. Only then could a determination be made with the TS
and other States Parties as to what constitutes an acceptable
level of verification. Del agreed that a visit by BG
Diamantidis may be possible once such steps were taken. Del
also stated that whatever BG Diamantidis recommends in terms
of use of additional monitoring equipment/technologies would
be just that, a recommendation.



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Status of implementation of Articles X and XI

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8. (U) The EC noted the Report by the Director-General on
the status of implementation of Articles X and XI of the
Chemical Weapons Convention as at 31 December 2002. Prior to
this decision, the US and UK both voiced concern at the small
number of States Parties that have complied with their
Article X declaration requirements. Iran and India commented
that the lack of agreed declaration formats has prevented
them from submitting the relevant Article X declarations.



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2002 Verification Implementation Report

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9. (U) The Council noted the 2002 Verification
Implementation Report (EC-33/HP/DG.1, dated 14 March 2003)
and three associated documents: (A) the Draft Corrigendum
(EC-33/HP/DG.1/Corr. 1, dated 14 June 2003), (B) the Director
General's Note on the Comments and Views Received on the 2002
Verification Implementation Report (EC-33/GD.13, dated 24
June 2003), and (C) the Chairman's summary of the informal
consultations on the 2002 VIR (EC-33/2, dated 23 June 2003
and Corr. 1, dated 25 June 2003). The Russian Federation
reiterated one of its written 'corrections' from the initial
compilation (item (B)) concerning their destruction of
leaking munitions at CWSFs, repeating the assertion that
their use of mobile destruction units was within the
definition of normal CWSF operation. They also expressed
concern over the potential for this issue to prevent the
future closure of inspection files. Concerns were raised by
other States Parties with the VIR corrigenda being
unclassified. The TS responded that the corrigenda did not

SIPDIS
contain any confidential information as such, but in the
future VIR corrigenda could be produced as Highly Protected
documents, if so desired by the States Parties.



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Article VI related obligations

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10. (U) Del underlined that this important document had been
received without sufficient time for delegations to present
substantive comments, which is essential, given the saliency
of the issue. This document was received by the Council with
the understanding that it could be returned to at a later
date if necessary. (Action Recommendation: Delegation
requests guidance and suggests we request to have this item
on the agenda for the next EC in September.)



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Annotated Agenda Item Five:
Deadlines for Destruction of Category 1
Chemical Weapons Stockpiles


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11. (U) Russia reiterated its success in meeting its 1
percent CW destruction milestone and stated that its
destruction line at Gorniy will be ready to begin destroying
lewisite in the third quarter of FY03. Moreover, all its
stocks at the Gorniy facility would be destroyed by 2005.
The Council noted the DG Report on the progress made by
Russia in destroying CW at Gorniy (EC-33/DG.9, 20 June 2003).
In his report, the DG stated that optimization of
verification measures at Gorniy continue to be discussed
between the TS and Russia, and that the Facility Agreement
for Gorniy would be distributed during the session. In
coordination with the U.S. Del, the UK Del raised the issue
of conducting the first of the EC Chairman's annual visits to
the Russian CWDF under construction at Kambarka, as called
for in the Decision document C-7/Dec.19, 11 October 2002,
adopted during CSP-7. However, the UK Del was unsuccessful
in negotiating with the Russian delegation suitable language
for inclusion in the Council report
on this subject. (Note: C-7/Dec.19 calls for the EC
Chairman to report the results of such annual visits to the
Council. What's more, based on the recommendation of the
Council, it calls for the Conference to take a decision
during CSP-8 establishing a substitute deadline for the
twenty percent deadline established in the Convention, as
requested by the Russian Federation. If CSP-8 is to take
such a decision, the Kambarka trip will have to occur prior
to the September EC session, so that the Council can receive
the Chairman's report and render a recommendation to the
Conference. Otherwise a special session of the Council will
have to be convened to receive the report and make a
recommendation. Delegation recommends approaching the EC
Chairman with a view to energizing the process of organizing
and conducting this trip sometime in August or early
September. End note).



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Annotated Agenda Item Six:
Detailed Plans for the Destruction
of Chemical Weapons


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12. (U) Russia stated they could not join consensus on the
ABCDF plan due to the precedent it establishes regarding the
declaration of the post destruction facility. (Note: Though
not stated by Russia on the floor of the Council, this
position relates to the issue of Russia's "end-point
destruction" concerns and the status of the 14 March CTR
Memorandum of Understanding regarding the U.S.-funded
Schuch'ye facility (Ref A).



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Annotated Agenda Item Seven:
Combined Plans for the Destruction or
Conversion and Verification of Chemical
Weapons Production Facilities


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Bosnia and Herzegovina Combined Plan

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13. (U) The Council approved the plan put forward by Bosnia
and Herzegovina (EC-32/DG.3, dated 14 Feb 03) with
corrigendum including U.S. comments.



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Russian Combined Plans

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14. (U) The Council deferred the combined plan for conversion
and verification of the CWPF (production of a VX-type
substance and filling it into munitions) at Open Joint Stock
Company "Khimprom", in Novocheboksarsk the Russian Federation.



15. (U) The Council approved the 4 remaining Russian combined
plans for conversion and verification. A corrigendum
containing U.S. requested language was approved for the Open
Joint Stock Company "Sibur-Neftekhim", "Kaprolaktam" plant,
Dzerzhinsk, the Russian Federation.



16. (U) The Council approved the combined plan for
destruction and verification of the CWPF at Newport Chemical
Depot, the United States, with the German-requested
corrigendum.



17. (U) The Council received a report from the DG on the
status of the conversion of former chemical weapons
facilities. At the request of the U.S. a note was added to
the Council report which included the need for transparency
measures, in accordance with instructions in Ref B.



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Text of Council Report Language on Transparency

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18. (U) "It is the view of the Council that during its last
regular session of each year, it should be fully informed by
relevant States Parties about the status of conversion at
those Chemical Weapons Production Facilities (CWPFs) located
on their territory where conversion is still in progress.

In addition, it is the view of the Council that the Director
General should inform the Council at its first regular
session following the conduct of a usual annual inspection by
the Technical Secretariat at those CWPFs where conversion is
still in progress, of the progress made at such facilities.

The Council understands that if a change in the schedule of
conversion activities at a CWPF occurs, an appropriate
amendment to the Combined Plan for the conversion and
verification for that facility will be submitted to the
Technical Secretariat as soon as possible."



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Annotated Agenda Item Eight:
Facility Agreements


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Belgian Facility Agreement

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19. (U) Per Belgium's request, consideration of the decision
regarding Belgium's Schedule 1 protective purposes facility
draft facility agreement (DFA) (EC-31/DEC/CRP.1, dated 11 Nov
2002) was deferred.



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Aberdeen and Umatilla Facility Agreements

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20. (U) The Council approved the Umatilla Chemical Agent
Disposal facility FA (EC-32/DEC/CRP.5, dated 10 Mar 2003)



21. (U) At Russia's request, consideration of the Aberdeen
Chemical Agent Disposal facility FA (EC-32/DEC/CRP.5, dated
10 Mar 2003) was deferred.



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ROK Facility Agreement

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22. (U) The ROK delegation asked that this item be deferred
to the next session of the Executive Council.



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Annotated Agenda Item Nine:
Chemical Industry Issues


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23. (U) The facilitator for intersessional consultations on
Captive Use had intended to circulate a formal draft decision
for EC consideration, but held off because there was no
consensus on the proposed text. Instead, the facilitator
issued a formal document labeled "Facilitator's Proposal" of
a draft decision (EC-33/DEC/CRP.4 dated 26 June). Technical
Secretariat staff confused the versions of the text, and

SIPDIS
erroneously used an older version without the facilitator's
most recent changes. A revised document will be issued
shortly.



24. (U) Until this week, the sole opponent to consensus was
the Russian Federation, which takes the position that
Schedule 3 intermediates (e.g., chemicals not isolated for
use or sale off the plant site) are not declarable. However,
during sidebar discussions this week, the German delegation
indicated they also do not support a decision on Captive Use
(draft German paper faxed to Washington). The draft paper
raises many objections, but from informal discussions it
appears the German del opposes a Captive Use decision because
they do not support declarations based purely on
"theoretical" calculations. Germany argues that there is no
firm basis for inspectors to verify such a declaration. DEL
NOTE: Declarations based on calculation are clearly required
by the already-approved Boundaries of Production decision
text and are not specific to Captive Use situations. As
written, the Captive Use decision text only clarifies that
there are no downstream physical handling activities that
negate or mitigate a State Party's obligation to declare
production if both concentration and quantity thresholds are
exceeded.



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Annotated Agenda Item Ten:
List of Validated Data for Inclusion
in the OPCW Central Analytical Database


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25. (U) This list was approved by the Council without
discussion.



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Annotated Agenda Item Eleven:
Financial Issues


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26. (U) Article IV and V: In his opening statement, DG
Pfirter called for a permanent fix to the reimbursement
mechanism. U.S. also called for a permanent fix in
Ambassador Javit's opening statement and from the floor under
this agenda item. Russia stated that it would need to
carefully study the issue. India stated that the U.S. may
have some good ideas, but reiterated its familiar line that
domestic legislation will prevent India from making advance
payments.



27. (U) DG report on cash surplus for 2001: TS Director of
Administration Schulz reported that the cash surplus for 2001
is $3,405,000. As of May 31, the OPCW cash balance was
$8,050,000 and that the 2001 cash surplus has not been
touched. In response to a U.S. call to use the 2001 surplus
to take care of the 1999 deficit, Schulz replied that it made
sense and the TS would look into it.



28. (U) The Council "noted" the report by the DG on income
and expenditure and "received" the ABAF report and the DG
note on transfers made between or within programmes in 2002.
The DG also notified the Council of transfers made between or
within programmes in 2002. U.S. Del noted that late
distribution of ABAF report and the documents on transfers
made it impossible for delegations to provide substantive
comments on these important documents. (Action
Recommendation: Del asks for Washington guidance on whether
to bring these items back up for discussion at the September
EC.)



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Annotated Agenda Item Twelve:
Draft OPCW Programme and Budget for 2004


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29. (U) Budget facilitator Beerworth (Germany) presented his
report on consultations to date. Beerworth plans to soon
distribute four papers so that capitals can study them during
the summer. The papers will be on inspector training for
2004, ICA (based on RevCon recommendations), additional
information on security, justification for four new
positions. After some discussion, the Council agreed that it
"received" the draft budget rather than "noting" it.



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Annotated Agenda Item Thirteen:
Provisional Agenda for the Eighth Session
of the Conference of the States Parties


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30. (U) The Council approved the draft provisional agenda
(EC-33/GD.7, dated 13 June 2003). Consideration was given to
the removal of Agenda Item Twenty - Date and Duration of the
Next Regular Session of the Conference of the States Parties,
as the dates have already been established for these
conferences through 2010. However, the decision was taken to
leave this item in to comply with Conference of States Party
rules, and to facilitate future changes in date or duration,
if required.



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Annotated Agenda Item Fourteen:
Any Other Business


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31. (U) The Council approved the appointment of John D. Fox
(U.S.), Sajjad Kamran (Pakistan), and Sang Soo Lee (Korea) to
the Advisory Body on Administration and Finance, effective
June 4, June 9, and May 27, 2003,respectively.



32. (U) The Council approved the inclusion of a statement
in the report for the Thirty-Third Session noting the
Council's satisfaction with the outcome of the First RevCon
and the need for a number of follow-up actions to be included
in its future work program.



33. (U) Hans Schramml (Austria), incoming facilitator for
Article X issues, announced that he plans to hold
consultations in September, and requested that delegations
review and provide comments on draft forms for Article X
reporting.



34. (U) Greece notified the Council of their EUR50,000
voluntary contribution as well as an additional EUR25,000
contribution to the Article X voluntary fund.



35. (U) Javits sends.
BAILY