US embassy cable - 04ROME3116

S E C R E T  ROME 003116 
 
SIPDIS 
 
 
DEPARTMENT FOR U/S BOLTON, A/S DESUTTER 
DEPARTMENT PLEASE PASS TRIPOLI 
NSC FOR JOSEPH 
 
E.O. 12958: DECL: 08/11/2014 
TAGS: PARM, PREL, KNNP, MNUC, LY, IAEA 
SUBJECT: U/S BOLTON'S JULY 10 MEETING WITH LIBYAN OFFICIALS 
 
 
Classified By: A/POLMINCOUNS PAULA THIEDE FOR REASONS 1.5 (B) AND (D) 
 
1. (S) Summary.  U/S Bolton July 10 told Libyan officials 
that Libya had to end military cooperation with Iran as a 
sine qua non of concluding Phase III cooperation.  The 
Libyans responded that all ongoing activity was linked to 
closing out existing contracts, which would be terminated on 
September 30, 2004.  Libya remained committed to SCUD-B 
elimination, but needed to save face with its military.  Some 
form of compensation was needed.  Libyan officials proposed 
various schemes--including a possible Russian buy back--that 
U/S Bolton deemed probably unworkable.  He urged Libya to 
keep the SCUD-Bs until the end of their natural life and 
consider procuring from a non-rogue state an MTCR-compliant 
alternative in the meantime.  The Libyans said that US/UK 
inspections of their SCUD stock, if it were maintained, would 
require international cover, and suggested bringing the MTCR 
into the process.  They reiterated support for establishing a 
Trilateral Mechanism, but wanted to make sure that langauge 
establishing it includes mention of Libya's legitimate 
defense needs.  End Summary. 
 
2. (S) U/S John Bolton on July 10 met at EUCOM Headquarters 
in Stuttgart with Libyan Ambassador to Italy Abdul Ati 
al-Obeidi, Chief of External Security Musa Kusa, and General 
Ahmed Mahmud.  David Landsman, Head of the FCO's 
Counter-Proliferation Department represented the UK.  EUCOM 
J5 Major General Jonathan Gration and POLAD Terry Snell also 
participated.  U.S. Embassy Rome political-military officer 
served as notetaker for the meeting, which focused on 
implementation steps connected to Libya's December 19, 2004 
commitment to eliminate its WMD. 
 
Libyan-Iranian Military Cooperation 
----------------------------------- 
 
3. (S) U/S Bolton explained that he had asked for the meeting 
in the spirit of removing remaining obstacles to Phase III 
conclusion.  He stressed that the US/UK wanted to wrap up 
Phase III, but there was a need to work through some 
outstanding items first.  U/S Bolton told the Libyans that 
the U.S. had sensitive information indicating Libya was still 
pursuing military cooperation with Iran despite its May 
announcement that it would cease such activity.  This was of 
concern and had to be resolved before Phase III could be 
considered complete.  He asked the Libyan officials to 
clarify the status of Libya's military relationship with 
Iran. 
 
4. (S) Al-Obeidi asserted that all current military-related 
activity is connected to completing existing contracts with 
Iran.  He explained that General Mahmud had over the past two 
weeks sent official letters to Iranian authorities informing 
them of Libya's intent to end all military cooperation with 
Iran by September 30, 2004.  Al-Obeidi offered to let US/UK 
officials planning to visit Libya in August see the letters. 
General Mahmud affirmed that all outstanding contracts would 
be terminated on September 30 and noted that copies of such 
contracts had already been provided to US/UK experts.  He 
asked that thought be given to compensating Libya for the 
economic loss it will incur from terminating its relationship 
with Iran.  Musa Kusa, concluding the Libyan response, 
underscored Libya's commitment to following through on its 
commitments; the September 30 date was firm, he said. 
 
5. (S) U/S Bolton explained that the U.S. was working under 
the assumption that all military cooperation was to have been 
severed immediately following Libya's May announcement.  This 
translated into no new relationships being established, the 
termination of existing contracts, and no future resumption 
of previous relationships.  Nevertheless, he allowed that 
this may not have been Libya's intention and that there could 
have been a misunderstanding.  U/S Bolton told the Libyans 
that, although he could not give them a definitive response, 
the U.S. probably could accept activity needed to close out 
existing contracts.  Termination by September 30 should be 
consistent with the U.S/UK-Libya agreement on Iran. 
 
6. (S) U/S Bolton stressed that the U.S./UK team would need 
to examine this issue together with appropriate Libyan 
officials, who, he was informed, would be made available from 
General Mahmud's staff.  David Landsman said he had also 
assumed termination would follow immediately from Libya's 
announcement, but stressed that it was now important to have 
a solid date after which Libya would no longer cooperate 
 
militarily with Iran.  He agreed with U/S Bolton that 
trilateral discussions about steps Libya is taking to 
terminate its relationship were important.  U/S Bolton added 
that the issue of compensation could be discussed in 
diplomatic channels, but signaled that Libyan optimism about 
a positive outcome would be misplaced. 
 
SCUD-B Disposition 
------------------ 
 
7. (S) Al-Obeidi reiterated Libya's commitment to eliminate 
its stock of SCUD-B missiles, but suggested the problem was 
not whether, but how to do so.  He argued that simply 
destroying them would create problems with the Libyan army. 
Some form of compensation was needed.  Qadhafi, al-Obeidi 
said, wanted to know if the U.S. couldn't simply take all of 
Libya's SCUDs since twenty-three have already been requested. 
 Alternatively, perhaps the Russians could be persuaded to 
buy them back.  Qadhafi, according to al-Obeidi, wanted the 
US/UK to make a gesture that would help him satisfy the 
military; the issue was not one of money but of saving face. 
"If you want Libya to be an example, you also have to take 
our problems into account," al-Obeidi argued.  Musa Kusa also 
claimed that Libyan "public opinion" was an issue as there 
was a prevailing sense that the U.S. was being tougher on 
Libya than on North Korea. 
 
8. (S) U/S Bolton stated flatly that the U.S. was not 
interested in obtaining more Libyan SCUD-Bs beyond the number 
already discussed.  He thought there was an agreement that 
Libya would keep its SCUD-B missiles until the end of their 
useful life, i.e. another three-to-five years.  The U.S., he 
assured his interlocutors, recognizes that Libya has 
legitimate defense needs and has no problem with Libyan 
procurement--from a non-rogue state--of an MTCR-compliant 
alternative to the SCUDs.  The expected shelf life of the 
SCUD-Bs should give Libya plenty of time to find such an 
alternative, he suggested, adding the caveat that neither the 
U.S. nor the UK were in a position to act as suppliers. 
 
9. (S) U/S Bolton clarified that his original understanding 
was that Libya was interested in procuring a replacement for 
the SCUD-Bs from Russia, not in having Russia buy back the 
existing missiles.  He agreed to consider engaging the 
Russians on a possible SCUD-B buy back, but thought such a 
scheme would be much less interesting to them than selling 
Libya a new system.  He also assured the Libyans that the 
U.S. could agree to language in an eventual declaration 
ending Phase III on Libya's legitimate interest in satisfying 
its defense needs within MTCR parameters as long as a missile 
purchase was not from a rogue state.  Landsman said the UK 
also accepts Libya's legitimate defense needs, and, within 
the constraints of the EU arms embargo, is keen to help Libya 
define its military requirements. (NOTE: Landsman noted that 
the UK MoD is engaged in talks with the Libyan military on 
restructuring its defense requirements in the post-December 
19, 2003 environment. (End Note.) 
 
10. (S) Al-Obeidi added that if Libya were to keep its 
SCUD-Bs, the question of how inspections were to be handled 
would need to be addressed.  He explained that Tripoli  would 
have difficulty with the continuing presence of US/UK teams 
visiting Libya without international cover.  Drawing an 
analogy to the manner in which the IAEA was brought into the 
post-December 19 nuclear inspection process, he suggested 
that a solution might be to organize US/UK inspections under 
the aegis of the MTCR. 
 
11. (S) U/S Bolton first assured al-Obeidi that what the 
US/UK had in mind was monitoring, not intrusive inspections. 
Nevertheless, he took on board al-Obeidi's idea to bring the 
MTCR into the inspection process, noting that the MTCR was 
not an international body with a large secretariat like the 
IAEA.  Without entering into specifics, U/S Bolton suggested 
a possible way forward could be for Libya to send periodic 
reports to the MTCR for evaluation.  He asked the Libyans to 
think of the inspection issue with the Trilateral Mechanism 
in mind.  Working on it under the umbrella of the Mechanism 
would give Libya ownership of the process; this was one of 
the advantages of cooperating together as partners.  Avoiding 
discussion of the SCUD-B issue by the full MTCR membership 
would be important as this would only bog down progress. 
 
12. (S) Al-Obeidi assured U/S Bolton that Libya supported 
using the Trilateral Mechanism, once it was set up, to work 
 
through issues together, but insisted on the need for 
international cover with regard to inspections.  He suggested 
that Libya could invite the MTCR to inspect Libya's SCUD-Bs 
as a follow up activity to submitting reports.  Al-Obeidi 
added that Libya accepts the notion of an exchange of letters 
establishing the Mechanism, but wanted the text to be 
balanced with language on Libya's legitimate defense needs in 
addition to its post-December 19 commitments.  He thought the 
establishment of expert-level subcommittees would create a 
useful mechanism for working through technical issues.  U/S 
Bolton agreed. 
 
Wrap-Up 
------- 
 
13. (S) Concluding, U/S Bolton listed a set of action items 
for follow up:  The US/UK team planning to visit in August 
would address the issue of Libya's military cooperation with 
Iran; Libya would receive draft langauge from the US/UK 
establishing a Trilateral Mechanism before the next US/UK 
visit.  Libya's legitmate security concerns would be an 
element of future discussion via the Mechanism.  If Libya 
kept its SCUD-Bs until their utility expired, the US/UK would 
support Libyan procurement of an MTCR-compliant alternative 
from a non-rogue state.  The way ahead, including the MTCR 
inspection component, could be discussed in the Trilateral 
Mechanism.  Al-Obeidi, wrapped up by saying, "so far, so good 
on WMD, but now we will be looking for closer political 
cooperation." 
 
14. (U) U/S Bolton did not have an opportunity to clear this 
cable. 
 
15. (U) Minimize considered. 
 
Visit Rome's Classified Website: 
http://www.state.sgov.gov/p/eur/rome/index.cf m 
 
SEMBLER 
 
 
NNNN 
 2004ROME03116 - Classification: SECRET