UKRAINE: MANPADS ACQUISITION AND THE NATO PFP

S E C R E T KYIV 000163

SIPDIS

SIPDIS

DEPT ALSO FOR PM/WRA, EUR/UMB, EUR/PRA

E.O. 12958: DECL: 01/22/2017
TAGS: MARR MOPS PREL PARM NATO PINR US UP
SUBJECT: UKRAINE: MANPADS ACQUISITION AND THE NATO PFP
TRUST FUND PROJECT

REF: A. STATE 5539


B. 06 KYIV 4432

C. 06 KIEV 3300

D. 06 STATE 134827

Classified By: Political Counselor Kent Logsdon for reasons 1.4(b,c,d)


1. (S) Summary: As a result of a January 17 meeting with
Deputy Defense Minister Tereshchenko on the proposals
regarding man-portable air-defense systems (MANPADS)
contained ref A, PM/WRA will work with the NATO Maintenance
and Supply Agency (NAMSA) to develop an amendment to the
NATO/PfP Trust Fund to lock in a Ukrainian offer to provide
an additional 2,101 MANPADS missiles and 584 gripstocks to
the Trust Fund and the U.S. offer to contribute an additional
$2 million for the Trust Fund to destroy large-caliber
munitions. At the meeting, we stressed to Tereshchenko that
the full $5 million of our original offer could be made
available if Ukraine provided 5,000 additional MANPADS,
instead of 2,101, for Trust Fund destruction. Tereshchenko
committed to engage other Ministry of Defense and uniformed
staff officials to explore this possibility. On the question
of MANPADS for countermeasures development, we said that,
recognizing the legal difficulties of Ukraine providing
MANPADS at no cost, we could provide $5 million to the
Ukrainian government in exchange for 1,500 MANPADS.
Ambassador will provide this offer in writing (in the form of
a non-paper based on the guidance in Ref A) during his next
meeting with Defense Minister Hrytsenko. Text of the U.S.
offer is in para 12. End summary.


2. (S) Visiting EUR/PRA Director Anita Friedt, PM/WRA Deputy
Director Steven Costner, and DOD and Embassy Kyiv
representatives met Deputy Defense Minister Volodymyr
Tereshchenko January 17 to lay out ref A proposals to provide
funding to the NATO PfP Trust Fund project for large-caliber
munitions destruction in exchange for Ukrainian provision of
additional MANPADS missiles for destruction and to reimburse
the Ukrainian government for a supply of MANPADS missiles to
be used in countermeasures development. When Costner
explained that, unfortunately, the Washington-based visitors
had been unable to secure an appointment with First Deputy
Defense Minister Leonid Polyakov, Tereshchenko said such a
meeting would not have been necessary since he was directly
responsible for all issues related to MANPADS.

NATO PfP Trust Fund
--------------


3. (C) On the NATO PfP Trust Fund project, Costner said he
wanted to emphasize that the U.S. was committed to remain
lead nation on the project regardless of the outcome of
bilateral discussions regarding destruction of additional
MANPADS. The USG appreciated the importance of destroying
small arms, light weapons, and munitions as well as MANPADS
and wanted to move forward on all of these to complete the
first phase of the projected 12-year project. During the
July nonproliferation working group meeting, he had proposed
that the U.S. would contribute an additional U.S. $5 million
for destruction of large-caliber munitions if Ukraine would
contribute an additional 10,000 MANPADS missiles for
destruction.


4. (C) Costner continued that the U.S. had tried to fashion a
proposal that would address the priorities of each party,
i.e., Ukraine's interest in destroying large-caliber
munitions and the U.S. interest in destroying MANPADS. In
tabling the proposal, the U.S. intended to expand the scope
of the phase one project and not to substitute destruction of
large-caliber munitions for some other element, such as small
arms/light weapons (SA/LW) destruction. The U.S. had
received the Ukrainian offer to destroy an additional 2,099
MANPADS, not the 10,000 requested. The U.S. had suggested
destruction of 10,000 based on its understanding of the large
quantity of MANPADS that were obsolete or excess to Ukrainian
defense needs. He would be interested in Tereshchenko's
assessment of the possibility of increasing Ukraine's offer
beyond 2,099.

The Ukrainian "Counter-offer"
--------------


5. (C) Smiling broadly, Tereshchenko said Ukraine had already
been responsive even before receiving Costner's request. The
document that he had before him detailed that Ukraine would
provide 2,101 MANPADS, not the 2,099 figure that Costner had
used, and 584 gripstocks. He stressed that he had not
plucked the number out of thin air; the figure had been
reached after intensive discussions with the Chief of the
General Staff (CHOD) and the CHOD's subordinates responsible

for weapons stockpile management. He urged Costner to
proceed on the basis of the current Ukrainian offer. He
would nevertheless enter into renewed discussions with his
uniformed counterparts to investigate the possibility of
increasing the number of MANPADS. An increase in the
Ukrainian offer, however, would take time.


6. (C) Indicating his understanding, Costner said he was not
in a position to provide a full $5 million in response to the
Ukrainian offer of two thousand additional missiles.
Although the original U.S. request had been for 10,000
MANPADS, the U.S. would contribute the full $5 million in
exchange for destruction of an additional 5,000 MANPADS. If
Ukraine had to stick to its current offer of 2,000 MANPADS,
the U.S. would only contribute an additional $2 million for
destruction of large-caliber munitions, but that the other $3
million would remain available for a potential subsequent
agreement. He would speak with NATO Maintenance and Supply
Agency (NAMSA) project officer Steve Brown to finalize an
addendum or appendix to the current project document to put
the U.S. and Ukrainian offers into writing. NAMSA would need
to sign appropriate documents with both Ukraine and the U.S.
Costner also noted that NAMSA's preliminary and rough
estimates indicated that $2 million would fund the
destruction of 6,000 tons of large-caliber munitions, while
$5 million would destroy 15,000 tons. Once the
infrastructure was in place, however, significantly greater
tonnages of munitions could be destroyed in follow-on phases
of the project.


7. (C) Tereshchenko expressed his appreciation for Costner's
frank and straightforward presentation and reiterated his
intention to engage other officials in the Ministry of
Defense and military staff about the possibility of
increasing the number of MANPADS for destruction.

MANPADS Countermeasures
--------------


8. (S) When Tereshchenko said he had to get to his next
meeting, Costner provided a telescoped presentation of the
U.S. offer on MANPADS for countermeasures development. He
recalled that the U.S. had requested Ukraine supply 300
Strela-3 MANPADS, 700 Igla-1, and 1,000 Iglas at no cost on
the basis that the missiles would be used to develop
countermeasures of mutual benefit to enhance the safety of
military and civil aviation. Such cooperation was a natural
step for allies facing a common threat.


9. (S) Costner said the U.S. had now reassessed its proposal
based on input from Ukrainian officials that transfer of
MANPADS at no cost had no legal basis and an update on its
needs for MANPADS for countermeasures development. Instead
of 2,000 MANPADS, the U.S. needed 1,500. The 1,500 MANPADS
required consisted of 500 Igla-1 and 1,000 Iglas. The latest
request eliminated the Strela-3 missile, reduced the number
of Igla-1 requested, and reduced the total number requested.
While the U.S. still viewed MANPADS countermeasures
development to be a joint effort by allies facing a common
threat, it was prepared to provide $5 million toward the
project. The $5 million amount did not include
transportation costs, from Ukraine to the United States,
which the USG would also cover.


10. (S) Costner explained the missiles would be used in
various tests of countermeasures under development. As one
example, the U.S. Department of Homeland Security would need
missiles sometime in October 2007 to test two different
systems. U.S. experts, however, would need to have the
missiles in hand no later than June to complete the necessary
preparations. Ukrainian officials were welcome to view this
test.


11. (S) Tereshchenko said he felt confident that the latest
U.S. proposal could be implemented and asked to receive the
proposal in writing. We will pass a non-paper, text below
(drafted in Kyiv by PM/WRA deputy director Costner based on
the guidance ref A and in consultation with DoD experts and
EUR/PRA Director Friedt),during the Ambassador's next
meeting with Defense Minister Hrytsenko. (Note: Ambassador
originally had a meeting scheduled January 19, but this
meeting was postponed.)


12. (S-REL UP) Begin text of non-paper.

Proposal for Transfer of Ukrainian MANPADS to the United
States

The United States is deeply appreciative of Ukraine's past
participation in the Multinational Force in Iraq. As you

well know, these forces are vulnerable to attack from
man-portable air defense systems (MANPADS). Although Ukraine
has reduced its presence, we need your help in protecting
these forces.

It has been reported that several thousand of these systems
may have entered the black market after the collapse of
Saddam's regime. Although multinational forces were able to
recover and destroy many of those MANPADS missiles,
significant numbers remain in the hands of insurgent forces
and are being fired at Multinational Force aircraft.

Due to the prevalence of SA-16 (Igla-1) systems and their
current use by insurgents in Iraq, it is a priority to
analyze such systems to develop the best countermeasure
techniques and technologies to protect the Multinational
Force-Iraq, as well as NATO forces in Afghanistan.

Additionally, we believe it is only a matter of time before
SA-18 (Igla) systems also fall into the wrong hands and pose
a threat to coalition aircraft. Therefore we urgently
request from Ukraine both SA-16s and SA-18s to assist in
developing more effective countermeasures.

Our original request in July 2006 (and in an August 16, 2006,
letter from Under Secretary Robert Joseph to Minister
Hrytsenko) was for 2000 MANPADS missiles (300 Strela-3, 700
Igla-1, and 1000 Igla) at no cost. Our rationale for this
request has been that this is not a typical commercial sale,
but instead a proposal for cooperation among allies to
address a common threat.

Since making our original proposal, we have reviewed our
needs -- which include a reduced requirement for the (SA-14)
Strela-3. Additionally, while we continue to view this
proposal not as a typical commercial transaction, but as a
proposal for cooperation among allies to address a common
threat, we have heard from the Government of Ukraine (GOU)
concerning the difficulties faced in providing the missiles
at no charge.

With the above-mentioned factors in mind, we would like to
submit the following revised proposal:

-- The Government of the United States requests that the
Government of Ukraine provide the USG with 1500 MANPADS
missiles (1000 Igla and 500 Igla-1).

-- Although the USG still does not consider this a commercial
sale, we would provide $5 million to the GOU to help address
Ukraine's financial concerns. This does not include costs
covering transportation from Ukraine to the United States,
which would be covered by the USG.

These missiles would be used for various countermeasures
tests. For example, the Department of Homeland Security
(DHS) has an immediate need for both types of missiles to
test against two competing countermeasure systems in
development for commercial aviation. This test is scheduled
for October 2007, and receipt of the missiles would be
required no later than June 2007 in order for U.S. experts to
perform the necessary preparations.

If desired by the GOU, Ukrainian experts could attend the
October test. We also could have appropriate experts come to
Kyiv to brief Ukrainian counterparts on the test in advance,
as well as to discuss other details of this proposal in more
detail.

The GOU's cooperation in this endeavor not only could save
the lives of many people associated with the Multinational
Force, but also enhance the safety of civil aviation. In
addition, it is a concrete, positive step in forging a closer
relationship with the NATO allies.

End text.


13. (U) Visit Embassy Kyiv's classified website:
www.state.sgov.gov/p/eur/kiev.
Taylor