Draft AAEC Paper

152 Draft AAEC Paper1

Sydney, 29 August 1968

Confidential

Non-Proliferation Treaty - Regional Arrangements

Introduction

1. One of the points in Submission No. 47,2 on which Cabinet sought further study, was the suggestion that Australia should actively explore with friendly non-nuclear weapons countries in the Pacific Area, the possibility of forming a co-operative group of nations for the purposes of the Non-Proliferation Treaty and possibly for other purposes associated with peaceful nuclear development.
2. The suggestion relies on Article III, paragraph 4, of the Treaty, which provides for non-nuclear-weapon States Party to the Treaty to conclude safeguards agreements with the International Atomic Energy Agency ‘either individually or together with other states’. This is understood to mean that, in the case of a collective Agreement, the I.A.E.A. might be satisfied by arrangements to verify the internal inspection system of a group of countries rather than itself assume the full inspection task.
3. The clause was inserted, in spite of opposition from the United States and the U.S.S.R., to meet the insistence of the Euratom countries which have had an established system of safeguards in operation for some years. The Euratom group will aim to avail itself of the provision. In this event, there is likelihood that the non-nuclear-weapons Comecon3 States will also seek to do so.

Considerations

1. Although it would not be prudent for Australia to appear at present to be taking any action to promote a new regional grouping, the possibility of regional collaboration and collective inspection arrangements could be explored with advantage.

[matter omitted]

1. For the grouping to be acceptable to the I.A.E.A. as an effective one for ‘internal’ safeguards under the N.P.T. (bearing in mind current capabilities and the time factor) Japan should be included. Canadian participation might be explored but it would seem unlikely. The Japanese attitude would be the most important initial consideration, and the following factors relate to this question: 1. The Japanese have stated that they would prefer to have inspectors only from those countries which are themselves subject to an international safeguards system. They have shown interest in a regional grouping with this end in view. 2. Japan has entered into a large scale nuclear power programme, and has negotiated with the United States a long term agreement for the supply of enriched uranium, together with a large quantity of plutonium for fast breeder reactor research. Japan has agreed to accept I.A.E.A. safeguards on this material. The United States would wish to ensure that regional safeguards [would]4 be equivalent to I.A.E.A. safeguards and that inspection procedures were fully effective. 3. As the I.A.E.A. has already discovered, the barriers of spoken and written language are so formidable in Japan as to make inspections difficult, even ineffective, by any person lacking education in Japanese. 4. Australia could probably recruit suitably qualified personnel who, after a course in Safeguards in the United States such as those currently being conducted, could form a body of safeguards inspectors, but two problems would remain, in that:
   1. The language barrier would be hard to overcome.
   2. The magnitude of the Japanese power programme would, unless Canada were a member of the grouping, call for an Australian commitment which would strain its resources of trained manpower.
2. It is concluded that the establishment of a regional grouping solely for the purpose of a safeguards inspection system is at present hardly practicable and should not be actively explored with possible members of a grouping other than Japan, with which further exploratory talks might be considered.

Co-operative Peaceful Nuclear Development

1. Australia already enjoys close co-operation in nuclear technology with India and New Zealand. Co-operation with Japan has been much more restricted, but the Japanese have recently expressed the wish that co-operation be developed. Whether this development takes the form of a regional arrangement, a formal bi-lateral arrangement, or informal co-operation on the lines of our co-operation with India, there are potential advantages for Australia.

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1. [matter omitted] Closer Australian ties with Japan could mean a substantial market for Australian uranium if further significant discoveries of this mineral are made.
2. There is no doubt that Australia would gain much from access to Japanese technical judgements and assessments. The Japanese policy has been to begin with systems developed in other countries, particularly the United States, and to build on what they learn from them. In the whole field of nuclear science and engineering, the Japanese are highly competent. This, coupled with their operational experience, means that they would have a lot to offer a country like Australia, which is of relatively small industrial capacity, and which is entering a nuclear power programme, not only of much more modest size, but some years behind. It is doubtful, however, whether Australia could penetrate the ‘commercial screen’.
3. A co-operative effort with Japan (or any other country or regional group) would seem unlikely to flourish unless it stemmed either from advantageous exploitation of Australian resources or a common interest in particular reactor systems, or both.
4. One point which could be explored, if Australia should find new substantial reserves of uranium, would be whether Japan could be encouraged to build a Japanese enrichment facility in Australia.

[matter omitted]

Conclusions

1. Establishment of a regional grouping solely for the creation of a group safeguards inspection system for the purposes of the N.P.T. should be explored, for the time being, only with Japan.
2. A regional grouping for co-operative nuclear development should be further explored, with Japan (and perhaps India) as a starting point.

[NAA: A1838, TS919/10/5 part 20]

• 1 The draft was attached to a letter dated 10 April 1969 from A.D. Thomas to Plimsoll.
• 2 Submission 47 was a joint submission to Cabinet from the Minister for National Development, David Fairbairn, and the Minister for Trade and Industry, John McEwen, of 4 April 1968 concerning nuclear non-proliferation safeguards.
• 3 The Council for Mutual Economic Assistance (Comecon) was an organisation under the leadership of the Soviet Union and consisting of states from the Eastern bloc as well as other socialist countries elsewhere in the world.
• 4 Word in square brackets added by hand.