The Australian Safeguards and Non-Proliferation Office claims that nuclear safeguards "provide assurances that exported uranium and its derivatives cannot benefit the development of nuclear weapons".
In fact, the safeguards system is flawed in many respects and it cannot provide such assurances.
The main component of nuclear safeguards is the monitoring and inspection regime operated by the International Atomic Energy Agency (IAEA). Nuclear Non-Proliferation Treaty (NPT) signatory states are expected to bring all nuclear material and activities under IAEA safeguards. There is an important exception to this rule, however, the five “declared” nuclear weapons states (US, Russia, UK, France, and China) are not required to put any nuclear facilities under safeguards though they may do so on a voluntary basis.
All but three states - Israel, India and Pakistan - are NPT signatories. North Korea has effectively withdrawn from the NPT although there are ongoing efforts to bring it back within the NPT “tent” through the protracted six-party talks.
IAEA safeguards involve periodical inspections of nuclear facilities and nuclear materials accounting to determine whether the amount of nuclear material going through the fuel cycle matches the country's records. In theory, the system is simple. In practice, IAEA safeguards have proven to be technically complex and politically contentious.
Five states have been reported to the UN Security Council for non-compliance with their safeguards agreements: Iraq in 1991, Romania in 1992, North Korea in 1993, Libya in 2004, and Iran in 2006. Other countries have carried out weapons-related research projects in violation of their NPT agreement, or have failed to carry out reporting requirements, without the matter being referred to the Security Council - including South Korea, Taiwan, the former Yugoslavia, and Egypt.
The five “declared” weapons states have NPT obligations to pursue disarmament. While none have been reported to the United Nations Security Council, they are arguably all in breach of their NPT commitments given their unwillingness to seriously pursue disarmament.
As IAEA Director-General Mohamed El Baradei noted in a February 2004 speech: "We must abandon the unworkable notion that it is morally reprehensible for some countries to pursue weapons of mass destruction yet morally acceptable for others to rely on them for security - indeed to continue to refine their capacities and postulate plans for their use."
IAEA budgetary constraints
The IAEA lacks the resources to effectively carry out its safeguards role. For more than 15 years, the IAEA's verification program operated under conditions of zero real growth. Then in 2004, the budget was increased by 12.4 per cent, with a further 3.3 per cent increase in 2005.
In October, El Baradei stressed the seriousness of the funding problem in a speech to an International Safeguards symposium in Vienna:
Financial resources are another key issue. Our budget is only $130 million; that's the budget with which we're supposed to verify the nuclear activities of the entire world. Reportedly some $1 billion was spent by the Iraq Survey Group after the war in that country. Our budget, as I have said before, is comparable with the budget of the police department in Vienna. So we don't have the required resources in many ways to be independent, to buy our own satellite monitoring imagery, or crucial instrumentation for our inspections. We still do not have our laboratories here in Vienna equipped for state-of-the-art analysis of environmental samples.
The IAEA oversees approximately 900 nuclear facilities in 71 countries. The problem of inadequate funding is exacerbated by the ever-increasing challenge of safeguards. The volume of nuclear material - and the number of nuclear facilities - requiring safeguarding increases steadily and the expanded inspection rights provided by Additional Protocols (discussed later) further stretch the system.
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