US embassy cable - 04BRUSSELS4335

S E C R E T SECTION 01 OF 04 BRUSSELS 004335 
 
SIPDIS 
 
DEPT FOR NEA/FO-DIBBLE, NP/FO:FITZPATRICK, EUR/ERA 
 
E.O. 12958: DECL: 10/08/2009 
TAGS: PREL, PARM, KNNP, IR, EUN, IAEA, UNSC, USEU BRUSSELS 
SUBJECT: WISHFUL THINKING? EU HOPES G8 CAN KEEP IRAN OUT OF 
UNSC 
 
REF: BRUSSELS 4201 
 
Classified By: USEU POLOFF LEE LITZENBERGER; REASON 1.4 (B,D) 
 
1.  (C)  Summary.  In meetings with NEA DAS Dibble and NP 
A/DAS Fitzpatrick on October 4-5, EU officials from the Dutch 
Presidency, Council Secretariat and Commission expressed 
concerns that IAEA referral of Iran to the UNSC in November 
would cross a major, negative threshold they want to avoid. 
The EU fears Iran would respond by withdrawing from the NPT 
and accelerating uranium enrichment, and that moving the 
issue to the UNSC would lead to confrontation.  The EU is 
still deliberating possible European components for a 
G8-endorsed "package" of significant incentives to offer Iran 
in return for cessation of enrichment, but wants to assemble 
as many carrots as possible -- including from the U.S.-- in 
one more effort to resolve the matter without recourse to the 
UNSC.  Should Iran respond in any meaningful way to an 
incentives package, even on the eve of the IAEA Board 
meeting, EU member states will likely oppose referral to the 
UNSC.  EU officials are aware this could lead to an 
undesirable transatlantic rift, but are unsure at this point 
how to reduce this risk.  Pushback from the U.S. side focused 
on the strategic and legal advantages of involving the UNSC, 
Iran's tactic of offering -- and breaking -- pledges to 
comply in order to keep the issue out of the UNSC, and the 
lack to date of any indication that Iran will consider making 
a strategic decision to suspend enrichment and forego a 
nuclear weapons program. End Summary. 
 
Points of Agreement... 
---------------- 
2.  (S)  On October 4-5, NEA DAS Dibble and NP A/DAS 
Fitzpatrick, accompanied by NEA/ARPI Waller and S/CT Miller, 
met with a wide range of EU and Canadian officials during and 
on the margins of the U.S.-EU-Canada Trilateral discussions 
on Iran.  Canada and the EU agree with the U.S.'s pessimistic 
assessment of internal developments in Iran, and shared their 
own downbeat assessment of trends in human rights, support 
for terrorism, and opposition to a negotiated Middle East 
peace settlement.  Although EU officials readily acknowledged 
that their policy of engagement on Iran has failed, their 
only prescription was  "more engagement."  On WMD, the EU was 
interested in Fitzpatrick's briefing on the status of Iran's 
work in converting its 37 tons of yellowcake into uranium 
hexafluoride, and its efforts to master the complex 
centrifuge technology related to uranium enrichment -- two 
chokepoints that, once passed, would give Iran a dangerous 
breakout capability.  Fitzpatrick underscored USG concern 
that Iran would agree to suspension on the eve of the 
November 25-26 Board meeting, only after it had passed these 
chokepoints.  A suspension pledge in that case would mean 
little, unless Iran turned over the UF6 and centrifuges. 
 
But Divergence over a G8 Initiative 
------------------- 
3.  (C) Nearly all EU interlocutors, however, expressed the 
hope that a G8-endorsed initiative could entice Iran to 
suspend enrichment, and avoid sending the issue to the UNSC 
at the November IAEA Board meeting.  The EU is still working 
on what the possible components of such an initiative could 
be.  Given the importance of "saving face" for Iran, most EU 
officials are convinced that "significant" carrots -- 
including especially from the U.S. -- are needed to bring 
Iran around.  The EU favors a G8 approach because, by 
including the US, Japan, and Russia, it broadens the appeal 
of any initiative for Iran.  Also, should a G8 initiative 
ultimately fail, moving the issue to the UNSC would then in 
theory have the support of Russia. 
 
Referral to UNSC Crosses Major Threshold 
--------------------- 
4.  (C)  Most EU officials shared the conviction that 
reporting the issue to the UNSC would shift the issue to an 
almost inevitable path toward conflict.  Iran, they argued, 
would likely withdraw from the NPT, accelerate its 
enrichment, or both.  One official asked rhetorically, "What 
is the advantage in having Iran outside the NPT and pursuing 
nuclear weapons?"  DAS Dibble and A/DAS Fitzpatrick 
questioned this assumption, noting that having Iran pursue 
nuclear weapons within the NPT is even worse.  They added 
that reporting to the UNSC is a necessary step to begin to 
ramp up pressure, but would not lead immediately or 
inevitably to sanctions or confrontation.  The UNSC could, 
however, provide a legal basis for "requiring" Iran to 
suspend enrichment, and also put Iran's program in a broader 
context than its narrower NPT obligations.  Most Board 
members believe the IAEA can only "call on" Iran to suspend; 
the UNSC has clear legal authority to compel Iran to do so. 
DAS Dibble observed that Iran will not abandon the NPT 
lightly; to do so would would imply that the purpose of its 
program is not peaceful, undercut support for Iran among the 
NAM and G-77 countries, and further isolate Iran in 
international eyes.  Unlike the cases of India and Pakistan, 
who never signed the NPT, Iran would have to abrogate an 
international treaty it has signed. 
 
Once in the UNSC, what then? 
----------------- 
5.  (C)  EU officials were skeptical that moving the issue to 
the UNSC would necessarily be effective.  Several questioned 
whether the U.S. could obtain nine votes and no veto on a 
Chapter VII resolution.  Referring the issue only to face 
vetoes would undermine the UNSC in dealing with Iran and 
future proliferants. Others were concerned that moving to the 
Council meant immediately seeking to impose economic 
sanctions.  Fitzpatrick laid out the several graduated steps 
that the UNSC could take that would raise the pressure on 
Iran to comply, but were short of the admittedly difficult 
step of imposing economic sanctions.  Council DG Robert 
Cooper stated flat-out that with oil at $50/barrel, the cost 
to Europe's economy would be such that the EU would be very 
reluctant to move to an oil embargo no matter what happened. 
Fitzpatrick also noted that Russian actions at the last IAEA 
indicated they might be cooperative; the key was to go into 
the UNSC with the support of the EU-3 and European members of 
the UNSC; we could then build on this core.  Fitzpatrick also 
stressed that reporting to the UNSC would not mean taking the 
issue away from Vienna.  We would expet the UNSC to give its 
support to the IAEA inspection process, which in any case 
will have to continue. 
 
Could UNSC Referral accompany a Parallel G8 offer? 
------------------- 
6.  (C) All EU officials expressed concern that there remains 
very little time to develop a G8 package, or give Iran much 
time to respond to one, before the November IAEA Board 
meeting.  Dibble and Fitzpatrick agreed, especially given 
that the objective was not to elicit yet another Iranian 
tactical ploy to delay referral to the UNSC, but rather for 
Iran to make the strategic decision that a network of 
relationships with the West would provide greater security 
than would nuclear weapons.  Dibble and Fitzpatrick pointed 
out that there was no reason referral to the UNSC could not 
occur in parallel with a G8 initiative.  Should Iran respond 
to a G8-endorsed initiative with concrete steps to halt 
enrichment and, as was the case with Libya, agree to 
dismantle its nuclear fuel cycle infrastructure, the UNSC 
could refrain from taking punitive action.  Ultimately, how 
Iran's nuclear program is viewed depends on how Iran responds 
to the concerns of the international community.  EU officials 
were skeptical that Iran would respond to any G8 initiative 
following a referral to the UNSC. 
 
Possible EU components of a G8 package 
---------------------- 
7.  (C)  EU officials are still brainstorming possible 
elements of a package that they can propose at next week's G8 
Political Directors meeting.  Annalisa Gianneli, Solana's 
Non-Proliferation advisor, avoided details on how such a 
package might be structured, but envisaged a combination of 
carrots and sticks that should be clearly spelled out. 
Elements of the offer could correspond to levels of 
compliance, with nothing given to Iran in advance.  One idea 
might be to propose holding a regional security conference to 
address the concerns driving Iran's perception of a strategic 
threat.  She agreed that "sticks" could include, for example, 
a visa ban on Iranian officials as well as the threat of 
referral to the UNSC.  However, EU officials did not 
articulate at what point they would consider Iran to have 
rejected a G-8 proposal (i.e., no deadlines or triggers) - 
presumably because their thinking has not progressed very far 
in that direction. 
 
A U.S. security guarantee as a carrot? 
-------------- 
8.  (C)  EU officials in all the meetings made references to 
the critical importance of some U.S. incentive on Iran to the 
success of a G8 package.  Bjorn Larsson on the Council's 
Policy Planning staff suggested the most compelling offer 
would be some kind of security guarantee -- along the lines 
of Secretary Powell's public statement that the U.S. respects 
the results of the Iranian revolution.  DAS Dibble responded 
that the Secretary's statement stands, but moving beyond it 
would be difficult politically, given Iran's defiance of its 
IAEA obligations and the many other outstanding issues where 
Iran undermines regional stability (Iraq, terrorism, and 
potentially Afghanistan).  The U.S. will not give Iran a 
"pass" on all these other issues in return for movement on 
the nuclear issue alone. 
 
Insight into EU thinking:  Some Sound bytes 
----------------------- 
9.(C)  What follows are some quotes by various EU officials 
from the discussions on Iran that illustrate EU thinking. 
 
Council Secretariat 
 
-- Robert Cooper, Solana's Foreign Policy Advisor:  "The U.S. 
seems concerned that Iran would respond to a G8 proposal (and 
thus postpone referral to the UNSC).  I'm concerned they 
won't respond at all.  If Iran does respond to a G8 
initiative, even on the eve of the November Board meeting, EU 
member states are not likely to support referral to the UNSC." 
 
-- Annalisa Giannelli, Solana's Non-Proliferation Advisor: 
"A G8 deal is preferable to referral to the UNSC.  We should 
construct a G8 package that includes carrots and sticks.  I 
think we should be hard on Iran in terms of what it must do, 
but generous in the carrots we offer." 
 
Commission 
 
-- Michael Leigh, Deputy DG for Middle East and CIS:  "The EU 
is not at the point where it could support moving the Iran 
issue to the UNSC if Iran responds to a G8 package.  We need 
to stay in touch, as this could become a transatlantic issue, 
and discuss it after the IAEA Board meeting, when new 
Commissioners are in place and the U.S. elections are over." 
(Fitzpatrick replied that the September IAEA Board resolution 
said decisions would be taken at the November Board meeting, 
not after.) 
 
-- Christian Leffler, Head of Middle East Department: "There 
are two unacceptable outcomes:  a nuclear Iran, and resort to 
force... The EU insists on engagement and dialogue with Iran, 
in part because we have no alternative.... Ultimate recourse 
to action on Iran would mean a complete policy failure. 
Backlash in the region would be enormous." 
 
Canada and some Dutch are the exception 
------------------------ 
10.  (C)  The exception to the sentiments expressed above 
came from the Canadian delegation, and from Dutch IAEA 
Mission Counselor Dirk Jan Kop, who said he expected Iran do 
"just enough" before the November IAEA board meeting to keep 
the board from referring the issue to the UNSC.  That said, 
he thought there would be enough votes on the Board to refer 
in November, if Iran does not agree to full suspension.  He 
reported that the Canadian Ambassador to the IAEA, who is now 
chairman of the Board, is planning a series of dinners in 
Vienna between now and the November board meeting in an 
effort to persuade NAM members that Iran is a sui generis 
case, and its referral to the UNSC would not in any way 
diminish other states' rights to pursue peaceful nuclear 
energy.  Kop and the Canadians were comfortable with a 
three-pronged approach: 
 
-- Develop a strategy for explaining the logic for referral 
to the UNSC (e.g. enhanced legal authority); 
-- Explore a G8 package, including possible incentives from 
the U.S.; 
-- Outreach to the NAM to address concerns that referral 
would undermine their access to peaceful nuclear technology. 
 
Next Steps/Timeline 
---------------- 
11.  (SBU)  Upcoming meetings offer the EU several 
opportunities to discuss and fine-tune their approach to Iran 
prior to the November IAEA Board meeting.  These include: 
 
Oct 7 restricted PSC discussion of Iran 
Oct 11 GAERC -- EU FM's (over lunch) 
Oct 13 G8 PolDirs meeting 
Nov 5 COUNCIL summit 
Nov 11 EU-Russia summit 
Nov 22-23 GAERC 
 
Comment:  Another Transatlantic Trainwreck? 
------------------ 
12.  (C)  EU thinking on Iran is beginning to crystallize 
around a G8 initiative that would be attractive enough to 
elicit Iranian cooperation -- in explicit exchange for not 
referring the issue to the UNSC in November.  From the EU's 
perspective, the onus will be on the G8 to include sufficient 
carrots to bring Iran around, and they will want to err on 
the side of offering too much rather than too little.  The 
key, in EU eyes, will be having a substantial U.S. carrot in 
the mix, preferably in the form of some kind of security 
guarantee.  The EU would probably support including some 
sticks in the package, too, e.g. if Iran does not cooperate, 
it will be referred to the UNSC, visa/travel bans will be 
considered, etc.  But their clear concern is not to "miss" 
the opportunity to avoid referral by being too stingy in the 
offer made to Iran. 
 
13.  (C) Comment continued.  There are several implications 
for transatlantic relations in the EU's approach.  First, the 
EU is not at present prepared to support pursuing a G8 
package in parallel with referral to the UNSC.  In their 
eyes, these are mutually exclusive approaches, and U.S. 
insistence on referral in November will be viewed as 
explicitly undermining chances for successful G8 initiative. 
Failure of a G8 initiative -- either due to the G8's 
inability to agree on a package, or due to Iran's rejection 
of an agreed package -- could also be laid at the U.S.'s door 
if the U.S. is viewed as having prevented agreement on a 
package, or is viewed as being unwilling to offer a carrot 
sufficiently enticing to bring Iran around.  The last place 
the EU will look to place blame will be Tehran, absent an 
outright Iranian rejection of a G8 package the EU judges to 
be "sufficient."  We thus risk a break with the EU over (a) 
the composition of a G8 package -- specifically, what U.S. 
incentives are included, and (b) how the G8 initiative is 
linked to referral to the UNSC -- specifically, whether the 
U.S. would agree not to seek referral if Iran responds 
positively to a G8 initiative.  A break with the EU over 
either issue could complicate our efforts in the IAEA Board 
to refer Iran to the UNSC or, once in the UNSC, our ability 
to secure the votes needed to take any action. 
 
14.  (U) This cable was cleared by NEA DAS Dibble and NP 
A/DAS Fitzpatrick. 
 
SCOTT