EU/CHINA ARMS EMBARGO: BRIEFING THE PSC ON CHINA'S

S E C R E T SECTION 01 OF 02 BRUSSELS 003210

SIPDIS

NOFORN

E.O. 12958: DECL: 07/21/2014
TAGS: PREL PARM MARR MCAP PHUM CH EUN USEU BRUSSELS
SUBJECT: EU/CHINA ARMS EMBARGO: BRIEFING THE PSC ON CHINA'S
MILITARY MODERNIZATION

REF: A. BERLIN 2539


B. THE HAGUE 1846

C. USEU TODAY 7/23/04

D. REIDHEAD/ALLEGRONE ET. AL. E-MAIL 7/22/04

E. USEU BRUSSELS 2896

Classified By: USEU Poloff Van Reidhead for reasons 1.4 (b) and (d).


1. (S/NF) SUMMARY: The EU Political and Security Committee
(PSC) hosted an informal gathering July 22 to receive a USG
intelligence briefing on China's military modernization
efforts and implications on regional stability if the EU
lifts its arms embargo on China. Post-briefing readouts from
EU participants indicate that our briefing will feature
prominently in internal EU discussions (including the July 27
PSC) of the strategic implications of lifting the embargo.
END SUMMARY.


2. (S/NF) EAP China Analyst John Culver delivered the
briefing to roughly sixty (60) EU officials, including PSC
Ambassadors and Deputies, Council DG Robert Cooper, WMD Rep
Annalisa Giannella, and Council and Commission officers from
regional and functional desks. Dutch PSC Chair Ambassador
Hamer opened the meeting by acknowledging that many in the
room viewed the embargo as anachronistic and not reflective
of China's HR progress or of the strengthening strategic
relationship between the EU and China. In that context, he
said it was important that the PSC have the opportunity to
hear and discuss US concerns about the implications of
China's military modernization on regional stability. (NOTE:
Under prior arrangement with the Dutch hosts, we did not
deliver the human rights segment of the briefing, as had been
done in Berlin and The Hague (refs A and B). We told the
ambassadors that our human rights briefer was in the room and
would be available to answer questions should they arise
(none did). We strongly support including the HR briefing
alongside future military modernization briefings in willing
EU capitals. Many thanks to DRL Senior Advisor Susan
O'Sullivan for being willing and available. END NOTE.)


3. (S/NF) Culver relayed an impressive amount of detail about
China's military modernization program, and at the same time
demonstrated how it was oriented toward acquiring the ability
to defeat Taiwan, and the US forces protecting Taiwan, in a
cross-straits conflict. He also explained how China was
seeking (through industrial espionage and military-commercial
partnerships) advanced weapons and dual-use technologies from
the West to support this modernization.


4. (S/NF) None of the attendees made policy points or used
the occasion to corner us in a debate. There were no
questions about human rights, the EU Code of Conduct on arms
exports, or other policy matters. Instead, the audience
stuck largely to the topic at hand. The atmosphere was
informal, courteous and respectful. Several Ambassadors
asked questions following the briefing, all of which Culver
fielded expertly:

-- Dutch Ambassador Hamer: How does China's increase in
defense spending relate to its dramatic increase in GDP?

-- Council DG Robert Cooper: How does the US control its
dual-use transfers? How much do countries that supply China
restrict their arms transfers? (Note: DCM McKinley answered
the first question by referring to US sanctions on China,
which include strict dual-use controls).

-- Irish Ambassador Kelleher: How much of China's military
modernization is fueled by off-the-shelf technology? What
should be done?

-- Greek Ambassador Paraskevoupoulos: Couldn't China's
military modernization be defensive, not offensive, in
nature? Can China really threaten the US and allies?

-- Italian Ambassador Melani: What percentage of China's
defense spending goes toward dual-use purchases? What is
China getting from Israel?

-- Portuguese Ambassador Pereira Gomes: What is Taiwan's
nuclear capability? How big is the defense spending gap
between China and Japan? Is the US going to engage China in
arms talks to prevent an arms race? (Note: We deferred on
this last question.)

-- UK Ambassador Gooderham: How concerned is the US about
recent Taiwanese rhetoric and its potential to provoke China?
(Note: We used EAP-supplied points to respond.)
-- Belgian Ambassador Wouters: In terms of military
capabilities, what does China need to invade Taiwan? Can
they do it yet? Will China even be able to invade Taiwan in
2008 (the year used for projections in the briefing)?

-- Dutch Military Rep: Isn't China's submarine fleet fairly
weak? Why are they focusing relatively more effort on
shorter-range diesel technologies than on their nuclear subs
and related technologies?


5. (S/NF) The Council Secretariat China Director, Ana
Ramirez, told us afterward that while our briefing would not
change minds on lifting the arms embargo, it would strengthen
the hands of those who want to ensure strong controls on
European exports to China, with or without the embargo. She
thought our briefing would feature prominently in upcoming EU
debates (including the July 27 PSC). WMD Rep Giannella's
Deputy, Andreas Strub, agreed that our briefing would be
useful as Member States debate the issue in coming months,
but added "not all Member States fully share your threat
assessment." Council Policy Advisor Chris Holtby thought our
briefing -- which he described as "wowing them with data" --
had reinforced our argument that lifting the embargo might
have unintended destabilizing consequences for the region.


6. (S/NF) COMMENT: While our briefing did not change any
minds, it certainly impressed upon the EU the seriousness of
China's military modernization program and regional goals.
We expect that the reports going back to capitals from the
PSC delegations will strengthen the hands of those with
outstanding concerns about the impact of lifting the embargo
on regional stability. And aside from the inherent value of
the intelligence contained in the briefing, our willingness
to deliver it to all 25 EU Member States -- at the same time
(as with the PSC) and individually (in the ongoing national
briefings) -- speaks volumes about the depth of our concerns
and resolve. The military modernization briefing, coupled
when possible with the HR briefing, is a good value and we
believe it would be useful to offer it in other willing EU
capitals.

Sammis