CONTINUED COOPERATION BETWEEN SOUTH KOREAN FIRM

S E C R E T STATE 123791 SIPDIS E.O. 12958: DECL: 11/21/2033 TAGS: PARM MTCRE PREL PK KS SUBJECT: CONTINUED COOPERATION BETWEEN SOUTH KOREAN FIRM AND ENTITIES ASSOCIATED WITH PAKISTAN'S MISSILE PROGRAM (S) REF: A. 06 STATE 185849 ¶B. 06 SEOUL 4041 ¶C. 06 SEOUL 4225 ¶D. 06 STATE 201428 ¶E. 06 SEOUL 4364 ¶F. 06 STATE 202354 ¶G. 06 SEOUL 4404 ¶H. 07 STATE 6640 ¶I. 07 SEOUL 1170 ¶J. STATE 26305 Classified By: ISN/MTR DIRECTOR PAM DURHAM REASONS 1.4 (B), (C),AND (D). ¶1. This is an action request. Embassy Seoul, please see paragraph 4. ¶2. (S) Background: On several occasions since November 2006, we have raised with South Korean officials efforts by the Pakistan-based company United Engineering to procure machine tools from the South Korean firm Sambu Korea Tek Co. Ltd (Reftels). We brought this information to the attention of the ROKG because United Engineering was seeking these machine tools on behalf of Pakistan's Project Management Organization (PMO),the entity responsible for the development and deployment of Pakistan's HATF-III missile, a Missile Technology Control Regime (MTCR) Category I system. Because the machine tools sought by United Engineering from Sambu Korea Tek are capable of being used to produce a variety of structural components for missiles, we have pressed ROK authorities to investigate this activity and urged them to prevent exports of South Korean-origin machine tools that could be used to support Pakistan's missile development programs. We most recently raised Sambu Korea Tek's business dealings with United Engineering in March 2008, but have not received a response to this demarche from the ROKG (Ref J). ¶3. (S) We now have new information indicating that Sambu Korea Tek has continued to engage in business dealings with entities affiliated with Pakistan's missile program. Specifically, as of mid-June 2008, Sambu Korea Tek was working with a Pakistan-based intermediary named Intralink to procure machine tools on behalf of United Engineering. Like past machine tools sales by Sambu Korea Tek to United Engineering, these machine tools are capable of producing ballistic missile components. In light of our past discussions of this case and our ongoing concerns regarding United Engineering's association with Pakistan's missile program, we want to ask South Korean authorities to investigate this activity and use all appropriate measures to prevent firms in South Korea from acting as a source of supply to missile-related end-users in Pakistan. We also want to request an update on actions taken in this case since our last discussion in March 2008. ¶4. (S) Action Request: Request Embassy Seoul approach appropriate host government officials to deliver talking points/non-paper in paragraph 5 below and report response. Talking points also may be provided as a non-paper. ¶5. (S) Begin talking points/non-paper: (SECRET REL SOUTH KOREA) -- On several occasions since November 2006 - most recently in March 2008 - the U.S. alerted your government to efforts by the Pakistan-based company United Engineering to procure vertical and horizontal machine machining centers from the South Korea firm Sambu Korea Tek Co. Ltd. -- You will recall that we brought this information to your attention based on our concerns that United Engineering was purchasing these machine tools on behalf of Pakistan's Project Management Organization (PMO). -- We believe that any goods consigned to United Engineering are very likely destined for Pakistan's ballistic missile program. --As we have noted before, PMO is a governmental entity involved in the development and deployment of Pakistan's HATF-III missile, which is a Missile Technology Control Regime (MTCR) Category I system. -- In our discussions of this case, we emphasized that the machine tools sought by United Engineering from Sambu Korea Tek were extremely versatile machines and are capable of being used to produce a variety of structural components for missiles. -- We now want to share with you recent information indicating that Sambu Korea Tek is continuing to engage in business dealings with United Engineering. -- Specifically, we understand that as of mid-June 2008, Sambu Korea Tek offered two Hwacheon MEGA 100 x 5000 computer numerical controlled (CNC) lathes and one Hwacheon MEGA 100 x 3000 CNC lathe to the Pakistani entity Intralink, which was acting as an intermediary on behalf of United Engineering. -- Although not controlled by any of the multilateral control regimes, these lathes are capable of being used to produce large structural ballistic missile components such as bulkheads and frames. -- Given United Engineering's association with PMO and the utility of such machines to the manufacture of missile components, we continue to be concerned that machine tools supplied by Sambu Korea Tek to Intralink Incorporated and United Engineering will be used to support Pakistan's missile development efforts. -- We therefore urge you to investigate this activity and use all appropriate measures to prevent firms in South Korea from acting as a source of supply to missile-related end-users in Pakistan. -- We also would appreciate any update on actions you have taken in the case since our last discussions in March 2008. -- We look forward to continued cooperation on nonproliferation issues and to hearing of any actions your government takes in response to this information. End talking points/non-paper ¶6. (U) Washington POC is ISN/MTR Dave Weinstein (Phone: 202-647-4019). Please slug any reporting on this issue for ISN/MTR. ¶7. (U) A word version file of this document will be posted at www.state.sgov.gov/demarche. RICE