Identifier
Created
Classification
Origin
07ASTANA1449
2007-05-29 08:15:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Astana
Cable title:  

SCENESETTER FOR ASSISTANT SECRETARY ROOD'S TRIP TO

Tags:  PGOV PREL PARM MNUC KNNP KZ 
pdf how-to read a cable
VZCZCXRO8474
RR RUEHDBU RUEHLN RUEHVK RUEHYG
DE RUEHTA #1449/01 1490815
ZNR UUUUU ZZH
R 290815Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC 9573
INFO RUCNCIS/CIS COLLECTIVE 0182
RUEBAAA/DEPT OF ENERGY WASHDC
RHMFIUU/DTRA CT WASHINGTON DC
UNCLAS SECTION 01 OF 03 ASTANA 001449

SIPDIS

SENSITIVE
SIPDIS

SCA/CEN FOR M.O'MARA, ISN/WMDT FOR M. DIETER AND E. HARBAUGH

E.O. 12958: N/A
TAGS: PGOV PREL PARM MNUC KNNP KZ
SUBJECT: SCENESETTER FOR ASSISTANT SECRETARY ROOD'S TRIP TO
KAZAKHSTAN

(SBU) Summary: Kazakhstan is proud to be hosting the third
meeting of the Global Initiative to Combat Nuclear Terrorism,
which will attract significant attention within the country.
The Kazakhstanis will be eager to trumpet their
non-proliferation accomplishments. Since renouncing its
nuclear arsenal soon after independence, Kazakhstan has
proven to be a reliable security partner and a steady,
positive influence in a turbulent region. The Kazakhstanis
also see the event as an opportunity to highlight their
country's achievements - a thriving economy, a rapidly
expanding capital, a harmonious multiethnic society - and to
demonstrate that they are capable of leadership, a key goal
as they continue with their bid to chair the OSCE in 2009.
The U.S. enjoys a positive security relationship with
Kazakhstan, although not without the occasional obstacle.
Several important programs are slowed or delayed by
Kazakhstan's labyrinthine bureaucratic procedures. Your visit
presents an excellent opportunity to reemphasize to the
Kazakhstanis the need to push forward on projects such as the
BN-350 spent fuel program and the HEU fresh fuel downblending
project. End summary

Political Context


2. (SBU) Your visit comes soon after the introduction of
constitutional amendments which on balance represent a
positive step toward democratic reform. The long-awaited
changes increase the size and power of parliament, strengthen
the role of local legislatures, eliminate the death penalty
except in cases of terrorism and war crimes, provide for
judicial sanction of arrest, and pave the way for government
financing of public organizations and political parties. The
president retains significant powers, however. In a surprise
move which has stolen headlines and provoked an outcry from
the opposition, a group of parliamentarians added a provision
exempting President Nazarbayev from existing term limits.


3. (SBU) Kazakhstan is certain to point to the constitutional
amendments as evidence of reform as they continue to push

forward with their candidacy to chair the Organization for
Security and Cooperation in Europe (OSCE) in 2009. The U.S.
has made clear that we welcome Kazakhstan,s aspirations, but
that any chair must exemplify the principles of the
organization. While the constitutional amendments have the
potential to lead to greater democratization, Kazakhstan will
need to take further steps to bolster its still
underdeveloped democratic political institutions, civil
society, and independent media.

The Central Asian Tiger


4. (SBU) Kazakhstan is the region,s economic powerhouse,
with an economy larger that those of all the other Central
Asian states combined (2006 GDP: $68 billion). The economy
has averaged 9.2% real growth over the past three years, and
the percentage of Kazakhstan,s population living below the
level of subsistence has dropped from 28.4% in 2001 to 9.8%
in 2005. The energy sector is Kazakhstan,s dominant earner,
with oil exports accounting for roughly a third of GDP.
Kazakhstan produced 1.3 million barrels of oil per day in
2006 and is expected to become a top ten oil producer soon
after 2015. Kazakhstan also possesses substantial proven gas
reserves (3 billion cubic meters),although it currently
exports very little gas.


5. (SBU) The U.S. is encouraging the GOK to diversify its oil
and gas export routes. Currently, the bulk of Kazakhstan,s
crude is exported via Russia, both through the Transneft
system and the independent Caspian Pipeline Consortium (CPC).
The majority of Kazakhstan,s near term oil production
increases are projected to flow to market either through the
Baku-Tbilisi-Ceyhan pipeline or an expanded CPC. All of
Kazakhstan's gas exports currently flow through Russia. Two
projects under GOK consideration, a trans-Caspian Pipeline
and a gas pipeline to China, would reduce dependence on
Russia.

A Positive Regional Influence


6. (SBU) Kazakhstan has cooperated extensively with the
United States in the Global War on Terrorism. Kazakhstan has
directly supported efforts in Iraq by deploying a military
engineer unit which has disposed of over 4.5 million pieces
of ordnance. Kazakhstan has provided over 4800 cost-free
overflight and emergency landing rights for U.S. aircraft
supporting Operation Enduring Freedom. The GOK has made
strong statements in support of U.N. resolutions sanctioning

ASTANA 00001449 002 OF 003


Iran and North Korea.


7. (SBU) Kazakhstan has also expressed its eagerness to play
an enhanced role in achieving regional integration. In
April, President Nazarbayev spoke of a Central Asian union
with a common market, an idea he has raised on several
occasions. Kazakhstan is already a significant economic
force in the region, the largest foreign investor in
Kyrgystan and soon to be the largest investor in Georgia,
according to the Georgian government. In an April 19 speech
at the Eurasia Media Forum, President Nazarbayev announced
that Kazakhstan is developing a "Special Action Program" to
increase humanitarian and economic cooperation with
Afghanistan and to invest in the Afghan economy. According
to Nazarbayev, Kazakhstan plans to construct a school in the
Samangan region and a hospital in the Bamian region.

A Strong Non-Proliferation Partner


8. (SBU) Non-proliferation has been a cornerstone of the
bilateral relationship since Kazakhstan,s independence.
With the collapse of the Soviet Union, Kazakhstan was left
with the world,s fourth largest nuclear arsenal.
Nazarbayev,s 1991 decision to give up Kazakhstan,s nuclear
arsenal was groundbreaking. Kazakhstan returned all tactical
nuclear warheads to Russia by January 1992, and all strategic
nuclear warheads by April 1995. Through the Nunn-Lugar
Cooperative Threat Reduction Program (CTR) program the U.S.
assisted Kazakhstan with the destruction of bombers, silos,
and related ICBM infrastructure.


9. (SBU) The U.S.- Kazakhstan non-proliferation relationship
remains productive. Cooperation continues under the CTR
program to secure the former Soviet nuclear weapons test site
in Semipalatinsk. The U.S. is working with Kazakhstan under
the Proliferation Prevention Initiative agreement to
strengthen its ability to prevent proliferation of WMD and
related materials across its borders by enhancing its WMD
detection and interdiction capabilities along the Caspian Sea
border. Through the Biological Threat Reduction Program, the
U.S. is supporting Kazakhstan in its efforts to combat
bioterrorism and prevent the proliferation of biological
weapons technology, pathogens and expertise. The DOE met
several key milestones in 2006 as preparations are made to
move three tons of weapons grade plutonium from the
decommissioned BN-350 nuclear reactor in Aktau to long term
storage at the Baikal 1 facility near the city of Kurchatov
in western Kazakhstan.

But Not Always a Prompt One


10. (SBU) Although non-proliferation and security cooperation
with Kazakhstan is generally good, maintaining progress often
requires a firm push. Early in the year, the Department of
Defense warned the GOK that it would suspend its CTR
programming if Kazakhstan failed to implement an effective
value added tax (VAT) exemption mechanism. With only a few
days to spare before the DOD deadline, Kazakhstan approved
pending subcontracts and avoided a shutdown. Kazakhstan
must still demonstrate, however, that the mechanism created
to approve the contracts is an efficient and effective
long-term solution.


11. (SBU) The U.S. and Kazakhstan must also extend the CTR
Umbrella Agreement in 2007. Renewal this year may prove
trickier than 2000, the last time the agreement was extended.
Some in the GOK have suggested that the language of the
agreement needs to be broadened to reflect all U.S. efforts
and aims (for example, to emphasize a focus on proliferation
of all weapons of mass destruction, rather than just
offensive strategic arms). Proposing changes to the text
will require delicate maneuvering, however, in order to avoid
the lengthy delays that would arise from a full-scale
reexamination of the text or by triggering Kazakhstani
requirements for re-ratification.


12. (SBU) Other important U.S. programs face frequent delays
more often due to the stuttering bureaucracy than to a lack
of will. In January, senior-level policy talks were held in
Astana on the permanent disposition of BN-350 spent fuel. An
agreement in principle was reached on a communique on
permanent disposition establishing the framework for further
talks. The Kazakhstanis have yet to sign the communique,
however, as it still has not received full interagency
approval.


13. (SBU) During President Nazarbayev,s 2006 visit to the

ASTANA 00001449 003 OF 003


U.S., the U.S. and Kazakhstan reached agreement in principle
to down blend approximately 21 kilograms of highly enriched
uranium (HEU) stored at the Institute of Nuclear Physics
(INP). Although the project has the president,s blessing,
progress has been delayed because no specific authorization
has been given to the Ministry of Energy and Mineral Resource
or to INP to implement the program.


14. (SBU) In September 2006, the five nations of Central
Asia signed the Central Asia Nuclear Weapon Free Zone Treaty
(CANWFZ),despite reservations voiced by the U.S., France,
and the U.K. The U.S. and other nuclear weapons states have
stressed repeatedly that they cannot support the treaty
unless their concerns were addressed in a satisfactory
manner. One significant concern is that other international
treaties can take precedence over the CANFWZ.
GILMER