MALAYSIA STUDYING IRAN PARTICIPATION AT ARMS SHOW

C O N F I D E N T I A L KUALA LUMPUR 000269 SIPDIS SIPDIS STATE FOR ISN, T, IO AND EAP E.O. 12958: DECL: 04/16/2018 TAGS: PARM PREL ETTC IR MY SUBJECT: MALAYSIA STUDYING IRAN PARTICIPATION AT ARMS SHOW REF: STATE 39049 Classified By: Political Section Chief Mark D. Clark reasons 1.4 (b and d). ¶1. (C) Polchief on April 15 delivered reftel demarche, aimed at urging Malaysia to respect UNSC sanctions on Iran by preventing Iranian exhibitors from participating in the Defense Services Asia (DSA) exhibition, to Foreign Ministry Under Secretary Bala Chandran. Bala heads the disarmament/nonproliferation division and is acting in charge of the multilateral political affairs/UN division. On April 16, Bala informed us that the MFA was "looking into Iran's involvement in the exhibition" and studying the UNSCRs in light of the U.S. position that the participation of the four Iranian entities could be viewed as violating UNSC sanctions on several grounds. The MFA also was seeking more information from the DSA organizers. (Note: Exhibitors will begin making physical preparations on April 17, and the official DSA launch is April 20. End Note.) ¶2. (C) Bala asked if the U.S. could provide more information on the possible association of the Iranian exhibitors with entities specifically sanctioned in the UNSCR annexes, and said such linkages would weigh heavily on Malaysia's response. Bala confided that Malaysia would not like to take "drastic action" (i.e., retracting permission for the Iranian entities) absent a clear basis. Polchief said we would share relevant information, if possible, but that the issue was largely beside the point. Even without such linkages, the participation of Iranian military supply entities in a commercial defense sales exhibition could be viewed as support for Iranian attempts to circumvent UN-mandated prohibitions against Iranian transfer of any arms and related material. ¶3. (C) We shared publicly available information on Iranian participation at the DSA with the British, Australian and French missions on April 15. The British High Commission informed us that on instruction they presented a demarche to the MFA on April 16 similar to the U.S. approach. British and French diplomats noted discussions underway regarding the appropriate level of their official representation at DSA (both the UK and France have senior officials scheduled to attend). The British High Commission also alerted the German embassy to this issue. ¶4. (C) The Mission's Office of Defense Cooperation (ODC) learned from DSA organizers that both the Malaysian Foreign Ministry and Defense Ministry had provided written approval for the Iranian participation in the military sales exhibition. According to the organizers, the Malaysian government insisted as a condition of approval that the Iranian companies not pay their exhibition fees via transfers from Iranian banks, and instead pay in U.S. dollars cash. KEITH