MONGOLIA-DPRK ECONOMIC DISCUSSIONS CONTINUE; GOM

C O N F I D E N T I A L ULAANBAATAR 000375 SIPDIS STATE FOR EAP/CM, EAP/K, S/NKP, ISN/NNPN, ISN/NESS, EEB ENERGY FOR KAY THOMPSON E.O. 12958: DECL: 12/29/2029 TAGS: ECIN EMIN ENRG ETRD PGOV PREL SCUL MG SUBJECT: MONGOLIA-DPRK ECONOMIC DISCUSSIONS CONTINUE; GOM ALSO CONSIDERING OTHER NUCLEAR AND EDUCATION INITIATIVES REF: EAP/CM 12/23 NIGHT NOTES TO EMBASSY ULAANBAATAR Classified By: Political Officer Dan Rakove for reasons 1.4 (b) and (d) ¶1. (C) SUMMARY: Dr. UNDRAA Agvaanluvsan, professor of nuclear energy issues and policy at Stanford University and newly appointed Deputy Director of the in-house think tank of Mongolia's National Security Council, informed Embassy officers on December 26 that the DPRK and Mongolia continue to discuss increased bilateral trade and exchanges. This will be a major topic of discussion during Foreign Minister Zandanshatar's visit to the DPRK at the end of January 2010. Undraa also discussed a separate effort by her and other Stanford faculty to host a US-DPRK-Mongolia trilateral meeting in Mongolia in Spring 2010. Separately, Undraa described a proposed Mongolia Nuclear Initiative to establish an international uranium enrichment zone that could provide nuclear fuel to the region while supporting geopolitical stability through Mongolia's neutrality and repudiation of weaponization ambitions. Finally, Undraa expressed a strong interest in Peabody-sponsored mining scholarships at the University of Arizona. END SUMMARY. -------------- Background -------------- ¶2. (SBU) Dr. UNDRAA Agvaanluvsaa was recently appointed as a Deputy Director of the National Security Council's in-house think tank, the Institute for Strategic Studies (ISS). She told Embassy officers on December 26 that beyond her ISS duties she is the government's point person on nuclear issues. Undraa is currently a visiting professor at Stanford University's Center for International Security and Cooperation (CISAC),but will leave the university in mid-March due to her new position with ISS. Though invited to join FM Zandanshatar's planned visit to North Korea in late January 2010, her teaching obligations through March may prevent her attendance. -------------- GOM and DPRK Economic Ties -------------- ¶3. (C) EmbOffs met with Undraa to discuss the FM's upcoming visit to North Korea. Undraa confirmed that FM Zandanshatar will visit North Korea, and stated it would likely be in late January, following the conference at Davos. He will likely be accompanied by Mongolia's Vice Ministers of Defense, Agriculture, and Labor. In addition to discussing economic ties, Undraa described the meeting as an opportunity for her government to urge the DPRK to open up. She recounted that before he became FM, the North Koreans told MP Zandanshatar that they needed nuclear weapons because they are "cornered." Zandanshatar replied that faced with a similar geopolitical situation Mongolia had succeeded through greater engagement under its Third Neighbor Policy. ¶4. (C) Heavily reliant upon Chinese labor, Undraa reported that Mongolia is interested in bringing in North Korean metallurgical experts as well as agricultural workers for work in Selenge Province, potentially to ship the resultant grain to the DPRK. Undraa also expressed an interest in gaining access to DPRK ports. The DPRK in turn is interested in any available economic exchanges and trade, and has sent and plans to continue sending prominent officials to Mongolia. ¶5. (C) Embassy officers shared ref points provided by EAP/CM and EAP/K regarding the FM's planned trip to the DPRK. After being demarched, Undraa stated it would be best for Post to follow-up directly with the Foreign Minister regarding U.S. concerns about the visit to the DPRK since she may not see the FM in person before the trip. -------------- Stanford-Based Initiatives on the DPRK -------------- ¶5. (C) Undraa stated that she and other Stanford faculty are also engaged with a couple of nominally private initiatives on North Korea. The first is to organize a trilateral US-DPRK-Mongolia meeting in Mongolia in the spring. She attributed this idea to former Secretary of Defense William Perry, and spoke of working with professors John Lewis (emeritus) and Siegfried Hecker as well. It is motivated by the notion that Mongolia enjoys good relations with both the US and the DPRK. ¶6. (C) The second initiative is to establish remote diagnosing facilities in China and Mongolia for tuberculosis in North Korea. This project is also a product of John Lewis and Undraa's discussions. Lewis previously hosted North Korean health officials in the Bay Area for preliminary discussions. He intends to follow up with his DPRK contacts as well as with the WHO. Undraa said that she and her Stanford colleagues may follow-up directly with State Department and other US officials in Washington regarding these two initiatives prior to her departure from the university and return to Mongolia in March. -------------- Mongolia Nuclear Initiative -------------- ¶7. (C) Undraa aspires to make Mongolia a supplier of enriched uranium to the region. Whereas current supplies originate from Russia or Western countries, Undraa spoke of a Mongolia Nuclear Initiative (MNI) to fill a niche as a small, neutral country without ambitions for nuclear weapons. Although Undraa allowed that political support for the initiative is yet unknown, the MNI envisions an international enrichment zone, likely in Mongolia's south or southwest, operated by international technical experts and designed largely for export to China and through Dalian to Japan if not elsewhere. This proposal is inspired by the IAEA's framework for multinational arrangements and discussions with Stanford emeritus professor Burton Richter; the broader initiative proposes similar international zones in other regions. Undraa reported that a January meeting at Stanford's Hoover Institution involving professor Thomas Isaacs and U/S Ellen Tauscher will focus upon the idea of multinational arrangements. -------------- Education Initiatives -------------- ¶8. (SBU) Undraa raised the issue of U.S.-based Peabody Energy's efforts to fund scholarships for Mongolian students to attend the University of Arizona (UA). While at Stanford, Undraa has served at the Director of the Mongolian-American Scientific Research Center (MonAme),which focuses on research and training. Post had heard previously from Peabody that they are seeking to fund four bachelor's degree scholarships at UA and two master's degree scholarships at the Colorado School of Mines, but this was the first indication of MonAme's involvement. According to Undraa, MonAme will help identify and recruit Mongolian students, and is also working on the visit of Mary Poulton, UA's Dean of the School of Mining, from January 8 to 15. MonAme is also participating in the steering committee exploring the pursuit of an American University in Ulaanbaatar. ADDLETON