POST REQUESTED TO FOLLOW UP ON ONGOING MATTERS OF

S E C R E T STATE 152317


E.O. 12958: DECL: 10/31/2027
TAGS: PARM PREL
SUBJECT: POST REQUESTED TO FOLLOW UP ON ONGOING MATTERS OF
PROLIFERATION CONCERN RAISED AT APEC BY PRESIDENT BUSH

REF: (A)STATE 071143, (B)STATE 073601, (C)STATE 72896, (D)BEIJING
5361, (E) STATE 148514


CLASSIFIED BY EAP DAS THOMAS J. CHRISTENSEN: 1.4 (B) AND (D).


1. (S) URGENT ACTION REQUEST: IN SEPTEMBER DURING THEIR
MEETING AT THE APEC SUMMIT IN SYDNEY AUSTRALIA, PRESIDENT
BUSH DISCUSSED WITH CHINESE PRESIDENT HU STRONG CONCERNS
RELATING TO THE ONGOING TRANSSHIPMENT VIA BEIJING OF KEY
BALLISTIC MISSILE PARTS FROM NORTH KOREA TO IRAN'S MISSILE
PROGRAM. PRESIDENT BUSH PLEDGED TO RESPOND TO PRESIDENT
HU'S REQUESTS FOR FURTHER INFORMATION. EMBASSY SHOULD ON
NOVEMBER 3 AT THE MOST EFFECTIVE LEVEL POSSIBLE, DELIVER
THE NON-PAPER IN PARA 8 WHICH RELATES TO SPECIFIC, TIME-
SENSITIVE INFORMATION ABOUT AN IMMINENT TRANSSHIPMENT. IN
ADDITION, AT THE EARLIEST OPPORTUNITY POST SHOULD DELIVER
THE NON-PAPER IN PARA 9 TO MFA AT THE HIGHEST LEVEL
POSSIBLE, PREFERABLY BY THE AMBASSADOR SINCE THIS IS IN
RESPONSE TO PRESIDENTIAL-LEVEL DISCUSSIONS.

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OBJECTIVES
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2. (S/REL CHINA) Post should:


--(This point for November 3 Delivery) Request China to stop an
imminent shipment to Iran's ballistic missile program. This is the
same cargo that the Ambassador shared about on October 25 (ref E). It
is now scheduled to leave Beijing airport on November 4.

--(This point for November 3 Delivery) Note the importance of this
demarche since it relates to a topic discussed by Presidents Bush and
Hu in Sydney. Embassy should further note that the Embassy will be
seeking an appointment at the highest level possible to convey a more
extensive presentation on this topic of ballistic missile parts from
North Korea to Iran.

--Remind Chinese officials that President Bush has been personally
engaged on the issue of the transshipment of ballistic missile parts
between North Korea and Iran via Beijing and that he raised this issue
with President Hu at the APEC Summit.

-- Seek information on the steps China has taken since the APEC
discussion to address this issue and impress on them the necessity for
China to take immediate strong action.

-- Stress that the credibility of UN Security Council actions must be
maintained by vigorous implementation by UN Member States of UNSC
resolutions calling for Chapter VII sanctions, particularly 1718,
1737, and 1747.

--Indicate that the U.S. believes that the proliferation of missile
technology between North Korea and Iran will increase and that these
two countries will attempt to conduct these transfers through Chinese
territory.

--Emphasize the need to inspect cargo and personal goods on regularly
scheduled flights transiting Beijing from North Korea to Iran in order
to detect and deter these shipments.

--Explain to Chinese officials that the U.S. carefully reviews the
intelligence material that we have on shipments before we share it,
and we ask that Chinese authorities respect this and act on our
information accordingly and appropriately.

--Indicate that the United States believes that we can work together
cooperatively and effectively on these issues.

--Express our willingness to continue to share as much information as
possible to assist China's efforts to uphold these UN Security Council
resolutions.

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Background: Ballistic Missile Parts Shipped via Beijing Between North
Korea and Iran.
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3. (S/Rel China) Iran and North Korea have continued their
longstanding cooperation on ballistic missile technology, via air-
shipments of ballistic-missile related items. We assess that some of
these shipments consist of ballistic missile jet vanes that frequently
transit Beijing on regularly scheduled flights on Air Koryo and Iran
Air. We believe that the Shahid Bagheri Industrial Group (SBIG) is
the probable end user for these parts. SBIG is listed in the annex to
UNSCR 1737 and these jet vanes are controlled under Item 10.A.2 of the
Missile Technology Control Regime and Item 6 of China's missile-
related export control regulations. Moreover, UNSCRs 1718 and 1737
prohibit the transfer to or from North Korea or Iran, respectively, of
jet vanes and any other item listed in UNSC document S/2006/815.
These shipments therefore represent violations of UNSCRs 1718 and

1737.


4. (S/Rel China) The U.S. has raised this issue with China at the
highest levels several times in the last few months. In May 2007, the
United States informed China of imminent shipments on three separate
occasions (Refs A,B and C). Though Chinese officials informed Embassy
Beijing that China's investigations have found no evidence of these
transfers, it appears that these shipments did occur and are
continuing to transit via Beijing. In addition this issue was raised
by ISN PDAS Patricia McNerney during bilateral nonproliferation talks
in August 2007 (Ref D). The Deputy Secretary also raised this issue
with Executive Vice Foreign Minister (EVFM) Dai Bingguo via during a
telephone conversation in August. Finally, in September 2007,
President Bush discussed this issue with Chinese President Hu at the
APEC summit in Sydney. The two leaders agreed that the USG would
provide the PRC with further information on these transfers.


5. (S/Rel China) On October 25 the U.S. provided PRC officials with
detailed information, including the airway bill and flight number, of
another imminent shipment of military related goods from North Korea
to Iran via Beijing. This shipment was also assessed as destined for
Iran's solid propellant missile development organization, the Shahid
Bagheri Industries Group (SBIG). We now have information that the
goods will be shipped on November 4 and insist on a substantive
response from China to this information.


6. (S/Rel China) Our information indicates that at least 10 air
shipments of jet vanes have transited Beijing thus far and that these
shipments will not only continue but will also grow in volume. We
have encouraged the Chinese to undertake frequent inspections of cargo
on Air Koryo or Iran Air flights transiting Beijing from North Korea
to both deter and detect these shipments.


7. (S/Rel China) The Department is seeking both immediate action on
this new information and a strategic approach with regards to this
critical issue. We assess that the best way to prevent these
shipments in the future is for Chinese authorities to take action,
such as those identified in para 9, that will make the Beijing airport
a less hospitable transfer point.

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NON-PAPER ON URGENT MATTER TO BE DELIVERED NOVEMBER 3
-------------- --------------


8. (S/Rel China) Begin points:

-- Last week we raised with you information regarding North Korean
plans to send a shipment, probably for Iran's ballistic missile
program, to Iran. We believe the cargo is intended for Iran's Shahid
Bagheri Industrial Group (SBIG),which is responsible for Iran's
solid-propellant ballistic missile program. You had requested
additional information.

-- We now have reason to believe that the items above will be shipped
to Iran via scheduled Iran Air flight on November 4.

--If these goods are missile-related, North Korea is prohibited under
UNSCR 1718 from exporting missile-related items and UN Member States
are prohibited from importing those items. In addition, North Korea
would potentially be precluded under UNSCR 1737 from transferring
these items to Iran if they are among the missile-related components
included in S/2006/815 or if North Korea or China determines that they
would contribute to the development of nuclear weapon delivery
systems. Moreover, SBIG is designated in United Nations Security
Council Resolution (UNSCR) 1737 and, as such, is subject to the
mandatory asset freeze called for in the resolution. With these
concerns in mind we are asking that Chinese authorities investigate
this shipment and prohibit it from proceeding to Iran.

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BEGIN NON-PAPER FOR DELIVERY BY AMBASSADOR
--------------


9. (S/REL CHINA) Begin Points:

--Over the past several months we have raised with Chinese officials
the problem of ballistic missile-related transfers between Iran and
North Korea being transshipped through China. President Bush raised
U.S. concerns on this matter with President Hu during the APEC summit
in Sydney, demonstrating the importance of the issue to the United
States. In response to President Hu's request for additional details,
we are providing you further information regarding these activities.
Specifically, we are urgently providing information regarding an
imminent shipment of serious concern.

-- North Korea is prohibited under UNSCR 1718 from exporting missile-
related items and UN Member States are prohibited from importing those
items. In addition, North Korea would potentially be precluded under
UNSCR 1737 from transferring these items to Iran if they are among the
missile-related components included in S/2006/815 or if North Korea or
China determines that they would contribute to the development of
nuclear weapon delivery systems. Moreover, SBIG is designated in
United Nations Security Council Resolution (UNSCR) 1737 and, as such,
is subject to the mandatory asset freeze called for in the resolution.
With these concerns in mind we are insisting that Chinese authorities
urgently investigate this shipment and prohibit it from proceeding to
Iran.

--We are very concerned that North Korean shipments of jet vanes occur
on regularly scheduled commercial air flights transiting through
Beijing. We believe this has been the case on about 10 flights.

--These items are likely intended for Iran's solid propellant missile
development organization, the Shahid Bagheri Industries Group (SBIG).

--These cargo shipments probably include front companies.

--We have identified a large number of shipments beginning late last
year of what are probably ballistic missile-related items that have
transited Beijing, and we would like to share further information on
these shipments.

--14 December 2006: A delegation from SBIG returned from Pyongyang
probably via Beijing and transported what we assess to be jet vanes
for a solid propellant medium range ballistic missile (MRBM) under
development in Iran.

--On or about 15 January 2007: North Korea delivered what were
probably jet vanes for Iran's developmental solid propellant MRBM to
SBIG via Beijing on board regularly-scheduled commercial passenger
flights.

--On or around 23 January 2007: North Korea delivered what were
probably jet vanes for Iran's developmental solid propellant MRBM to
SBIG via Beijing on board regularly-scheduled commercial passenger
flights.

--On or about 16 May 2007: An air shipment composed of four what were
probably jet vanes from North Korea to Iran for SBIG was scheduled to
depart North Korea and transit Beijing via regularly-scheduled
commercial passenger flights.

--On or about 24 May 2007: An air shipment composed of five what were
probably jet vanes from North Korea to Iran for SBIG was scheduled to
depart North Korea and transit Beijing via regularly-scheduled
commercial passenger flights.

--On or about 6 June 2007: An air shipment composed of four what were
probably jet vanes from North Korea to Iran for SBIG was scheduled to
depart North Korea and transit Beijing via regularly-scheduled
commercial passenger flights.

-- On or about 12 June 2007: An air shipment composed of five what
were probably jet vanes from North Korea to Iran for SBIG was
scheduled to depart North Korea and transit Beijing via regularly-
scheduled commercial passenger flights.

--On or about 14 June 2007: An air shipment composed of three what
were probably jet vanes from North Korea to Iran for SBIG was
scheduled to depart North Korea and transit Beijing via regularly-
scheduled commercial passenger flights.

--On or about 14 July 2007: An air shipment composed of ten what were
probably jet vanes from North Korea to Iran for SBIG was scheduled to
depart North Korea and transit Beijing via regularly-scheduled
commercial passenger flights.

--On or about 26 July 2007: An air shipment possibly composed of an
unknown number of jet vanes from North Korea to Iran for SBIG was
scheduled to depart North Korea and transit Beijing via regularly-
scheduled commercial passenger flights.

--On or about 22 August: An air shipment possibly composed of one jet
vane from North Korea to Iran for SBIG was scheduled to depart North
Korea and transit Beijing via regularly-scheduled commercial passenger
flights.

--We believe that the number of jet vanes sent to Iran will increase
dramatically in the future.

--To date we believe that about 40 probable jet vanes have been sent
from North Korea to Iran.

--The contract for these components called for a total number of 500
and we assess that shipments of these may increase to a rate of 100-
160 per month.

--In addition, our information indicates that a second order of 1,500
components - possibly additional jet vanes - was agreed to in December
of last year.

-- We believe that this trade will continue to utilize regularly-
scheduled commercial passenger flights.

--As we have discussed on several occasions, Iran also has been
seeking probable tungsten-copper alloy plates from China's Dalian
Sunny Industries, also known as LIMMT. Dalian Sunny Industries
shipped part of an order for this material in September. These plates
are suitable for Iranian domestic production of jet vanes or as an
insulator for ballistic missile components. Iran could be seeking
these plates in case North Korea is unable to provide the quantity or
quality of jet vanes required.

--We urge you to prevent such shipments via whatever action you deem
appropriate, including frequent inspection of Iran Air and Air Koryo
flights. The use of regularly-scheduled commercial passenger flights
indicates that frequent regular inspections of Iran Air flights and
Air Koryo flights are in order and would help deter these shipments in
the future.

--We will continue to provide you with relevant information to help
end this proliferation.

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Reporting Requirement and POC
--------------


10. (U) Please report delivery of cable and any immediate response by
November 8, 2007.


11. (U) Washington point-of-contact for follow-up information is
Matthew Zartman (202) 647-7588, zartmanml@state.sgov.gov. Please slug
all responses for ISN, T, and EAP. Washington appreciates Post's
assistance.


RICE