US embassy cable - 03THEHAGUE2581

C O N F I D E N T I A L SECTION 01 OF 04 THE HAGUE 002581 
 
SIPDIS 
 
STATE FOR AC/CB, NP/CBM, VC/CCB, L/ACV, IO/S 
SECDEF FOR OSD/ISP 
JOINT STAFF FOR DD PMA-A FOR WTC 
COMMERCE FOR BIS (GOLDMAN) 
NSC FOR CHUPA 
WINPAC FOR FOLEY 
 
E.O. 12958: DECL: 10/08/2013 
TAGS: PARM, PREL, CWC 
SUBJECT: CHEMICAL WEAPONS CONVENTION (CWC): SCENESETTER FOR 
THE EIGHTH CONFERENCE OF STATES PARTIES 
 
REF: THE HAGUE 2453 
 
Classified By: Ambassador to the OPCW Eric M. Javits for Reasons 1.5 (B 
, D) 
 
 This is CWC-104-03. 
 
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SUMMARY 
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1.  (C)  The Oct. 20-24 Conference of States Parties will be 
dominated by discussion of the budget and other financial 
issues.  We have supported the Director-General's request for 
a 7.36% increase, and share the DG's view that an increase of 
this magnitude is needed to ensure core functions are 
adequately financed.  However most delegations are not 
convinced, and as a result, the final budget number will, in 
all likelihood, be decided at the eleventh hour of the CSP. 
With regard to the U.S. request for an extension of our 45% 
destruction deadline, whether the issue takes center stage 
will depend on what we have convinced the Russians to accept 
in the run-up to the CSP.  While there is still skepticism 
among many delegations about the U.S. position regarding our 
100% destruction deadline, we suspect most delegations will 
not be more vocal than the Russians.  On other action items, 
there is a reasonable chance that an Article VII action plan 
for national implementation will be ready for adoption by the 
Conference, and an outside chance that that may also be the 
case regarding an action plan on universality.  Under 
industry issues, a decision on Captive Use might also be 
ready for consideration.  Finally, the ILO decision regarding 
former Director-General Bustani is not on the formal agenda, 
and there is no indication yet that it will be specifically 
added.  While it could come up as part of "any other 
business," there is no clear consensus at this point on what 
action (pay/not pay; appeal/not appeal) member states want to 
take, and everyone is waiting for the U.S. position on how 
the organization should respond.  In the absence of a clear 
U.S. policy driving the CSP to a particular outcome, it is 
likely that the Conference may simply punt on this issue for 
another year.  End Summary. 
 
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OPCW 2004 BUDGET - PAYING FOR CORE FUNCTIONS 
-------------------------------------------- 
 
2.  (C)  DG Pfirter has proposed a budget increase of 7.36% 
for 2004, making a strong case that the full amount is needed 
to ensure that the organization can perform its core 
functions.  While delegations have been willing to consider 
an increase, 7.36% is far above the increase most delegations 
currently are willing to accept.  The Japanese entered the 
budget debate pressing for zero nominal growth, and the 
Western Group is bunched around an increase of some 6%.  Amb. 
Javits has fully supported Pfirter and made the case for the 
DG's proposal in larger budget discussions as well as in 
individual meetings with delegations.  While there was 
consideration of holding a special Executive Council meeting 
to try to hammer out agreement on a budget, the consensus is 
that there would be little reason to hold such a meeting, and 
it would be more efficient to have the CSP gather as a 
special EC at the start of the conference.  Even with that 
step, it is likely that the budget discussions will continue 
on to the last min 
ute and be decided by attrition. 
 
3.  (SBU)  The DG has also made a strong case to have more 
flexibility to pursue efficiencies.  While there are concerns 
about some aspects of the DG's management decisions, such as 
on travel and use of consultants, there appears to be general 
agreement on the need to avoid micromanagement by the 
governing bodies.  We support the general approach promoted 
by the DG to give him added authority to pursue streamlining 
and reform, while ensuring that he does not have carte 
blanche.  With regard to other key financial issues, the DG, 
pursuant to suggestions from the U.S., is making a request 
for retention of the 2001 cash surplus of 3.4 million Euros. 
In addition, he has made a separate request to establish a 
special fund for late receipt of Article IV/V funds in 2004 
to be retained for use by the OPCW, rather than have the 
monies returned to the States Parties. 
---------------------- 
U.S. EXTENSION REQUEST 
---------------------- 
 
4.  (C)  At EC-34, Russia blocked consideration of the U.S. 
request for extension of the 45% destruction deadline, and 
was content to merely provide a list of questions which broke 
no new ground.  While the Russians touched on the issue of 
what the U.S. intends to do about the 100% destruction 
deadline in April 2007, they did not conduct a frontal 
assault on the issue.  That was left to other delegations 
during informal consultations during the September EC.  There 
was eventual agreement on language that would assuage the 
concerns of Germany, the U.K. and a number of other 
countries, although this did not eliminate a healthy 
skepticism about the U.S. approach to addressing the 100% 
deadline.  Whether that skepticism will become manifest at 
the CSP will likely depend once again on how the Russians 
wish to play this issue at the Conference.  While there is 
substantial veiled (and sometimes open) off-line criticism 
about the U.S. reluctance to address the issue of the 100% 
deadline, members of the Western Group will not be more 
critical than the Russians on the conference floor. 
 
5.  (C)  As for Russian attempts to draw parallels between 
their extension request for the 20% destruction deadline, and 
the U.S. request, the Western group is solidly opposed to the 
Russian ploy.  And while NAM delegations may well chide the 
U.S. and Russia on not having met deadlines (while India 
pointedly noted that it is meeting its obligations on time), 
this will be more of an irritant than a problem. 
 
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BUSTANI DECISION 
---------------- 
 
6.  (C)  While a number of legal and political arguments have 
been raised regarding the ILO decision on former DG Bustani, 
there is no clear consensus among delegations about what 
action should be taken by the OPCW.  All delegations are 
waiting for the U.S. position on how it wishes the 
organization to respond, and that will likely serve as the 
driving force for any decision by the Conference.  In the 
absence of a clear U.S. position, the chances for concrete 
action at CSP-8 are minimal.  The July 29 provisional agenda 
for the Conference has no specific item regarding Bustani. 
The detailed agenda will not be provided until next week, and 
there is as yet no indication of a specific reference to the 
ILO decision.  As a result, the one place where the issue 
could arise is in the "any other business" category.  Whether 
any delegation wishes to raise it is problematic, as there is 
no indication that the member states are agreed upon an 
appropriate response by the OPCW. 
 
7.  (C)  The general consensus is that the ILO decision is 
simply wrong, but there is also a strong desire to have the 
OPCW put this issue behind it and move on.  Beyond those 
general sentiments, positions are divided on the specific 
issues of 1) payment of the ILO judgment, and 2) appealing 
the decision.  A small number of states have advocated paying 
the judgment in order to put the issue to rest.  Another 
group wants to pay before taking the steps needed to appeal 
the ILO decision.  What probably comes closest to an 
amorphous general view is that the organization needs to 
follow the rule of law, which would entail an appeal directly 
back to the ILO on the issue of material damage, or to the 
International Court of Justice via the UNGA on the overall 
issue of the ILO's jurisdiction in handing down the decision. 
 
 
8.  (C)  Under such circumstances, without a U.S. policy 
driving the discussion, it is unlikely that the CSP would 
reach agreement on a particular course of action, and will 
likely defer action on the issue until the next Conference. 
The OPCW's Rule 69 states that on a matter of substance, a 
decision should be taken by consensus.  If consensus is not 
attainable when the matter comes up for decision, there is a 
mandatory 24-hour deferment during which the presiding 
officer must seek to achieve a consensus.  If there is still 
no consensus, the decision requires a two-thirds majority of 
members present and voting.  Rule 71 clarifies that "present 
and voting" means casting a valid affirmative or negative 
vote.  Members who abstain from voting shall be regarded as 
not voting. 
 
9.  (C)  With the Bustani issue so contentious, it is very 
likely that many delegations will simply abstain.  As a 
result, the number of countries required to block such a 
decision (one-third plus one), is potentially very small. 
Moreover, in the event that a two-thirds majority could be 
found to pay the judgment, the Technical Secretariat has 
informed us there is no amount set aside in the budget for 
such a payment.  As a result, there may be recourse to a 
voluntary fund to pay the judgment.  However, supporters of 
Bustani may balk at pursuing such a course, as there is the 
risk of an embarrassing response to any request for funds to 
pay the former DG.  As a result, in the absence of a clear 
decision supported by the U.S., the likely result may well be 
statements from the floor on the ILO decision, but a deferral 
of action until the next CSP. 
 
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ACTION PLAN ON NATIONAL IMPLEMENTATION 
-------------------------------------- 
 
10.  (SBU)  The Article VII facilitator (Mark Matthews/U.K.) 
has done yeoman's work in pushing for an action plan on 
national implementation, and it will not be clear until the 
end of the week whether he has managed to achieve consensus. 
The final remaining issue involves acceptable language 
regarding measures to ensure compliance from countries that 
do not meet the agreed-upon timetable.  DG Pfirter will be 
chairing a small meeting of key countries (U.S., U.K., Iran 
and India) to see if agreement can be reached on acceptable 
wording on that point.  In every other respect, the draft 
text meets the goals set out by the U.S., in particular, 
containing language that marks CSP-10 as the timetable for 
meeting obligations. 
 
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ACTION PLAN ON UNIVERSALITY 
--------------------------- 
 
11.  (U)  Here again, the facilitator (Consuelo 
Femenia/Spain) has made substantial progress, and there is an 
outside chance that consensus will be reached on an action 
plan by CSP-8.  There is general support for the TS to drive 
the process and use voluntary regional and sub-regional 
points of contact to push the initiative.  Delegations are 
split on the issue of whether to state that some non-States 
Parties are of more concern than others.  In addition, there 
remains substantial opposition among NAM and other 
delegations for numerical targets.  Despite these divisions, 
the facilitator is pushing ahead with consultations to find 
acceptable wording, and with the onset of the CSP as a firm 
deadline, there are reasonable prospects for consensus. 
 
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ARTICLE XI 
---------- 
 
12.  (SBU)  Iran and others have sought to use work on 
fostering international cooperation for peaceful purposes as 
the vehicle to launch an attack on the Australia Group and 
establish a cooperation committee for consultations for 
promoting Article XI implementation among States Parties. 
While the Facilitator (Norma Suarez/Mexico) has sought to 
find a paper that will be an acceptable point of departure 
for the Western Group, she has not yet been successful.  The 
issue should not be ripe for discussion at the CSP, although 
there may be some shots fired by the Iranians and others. 
 
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CHALLENGE INSPECTIONS 
--------------------- 
 
13.  (C)  The issue of challenge inspections may come up in 
side-bar discussions.  During EC-34, the EU statement, read 
by the Italian representative, made reference to the issue of 
challenge inspections and to the European desire to see 
progress made on this front.  While there is no specific item 
on the CSP agenda that would allow for a decision of any type 
regarding challenge inspections, the Europeans may elect to 
return to the topic during informal talks. 
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INDUSTRY ISSUES 
--------------- 
 
14.  (SBU)  The facilitator for "Captive Use" appears ready 
to push for a decision at a Special EC Session in hopes of 
adopting the decision at CSP-8.  A revised text, which 
accommodates Indian concerns, is being circulated by the 
facilitator and should achieve broad support.  However, we 
understand Germany may still have reservations about any 
"Captive Use" decision that does not apply equally to 
Schedule 1 and Schedule 2 and 3 chemicals.  The decision, as 
written, is in accordance with U.S. guidance. 
 
15.  (U)  Javits sends. 
SOBEL