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