Atoms for Peace becomes a casus belli

the Third World who agreed to the draconian IMF terms, to refi nance their oil-related defi cits.

ATOMS FOR PEACE BECOMES A CASUS BELLI

But there were growing signs in too many parts of the world that the potential still existed for stronger and potentially decisive initiatives in technology transfer from the key European industrial nations, as well as from Japan, to select developing countries. While the broad front presented at Colombo had been nominally defeated, the idea of specifi c North–South economic cooperation was taking hold in dramatic new ways.

During late 1975, the government of Brazil entered into a major agreement with the German government of Helmut Schmidt for construction of a complex of nuclear power stations, fuel enrichment plants and other related technologies. The German nuclear reactor manufacturer, KWU, signed what at the time was the largest single nuclear contract in the world. Germany was to provide ‘turnkey’ construction of eight nuclear power reactors and facilities for the entire nuclear fuel cycle, including enrichment. Valued at a total cost of $5 billion, the entire project was to be completed by 1990. The European uranium enrichment consortium, Urenco, was to supply the initial uranium fuel. Also in 1975, Brazil signed a $2.5 billion cooperation agreement with France for the construction of an experimental fast breeder reactor. Washington responded with unprecedented efforts to force Germany as well as Brazil to cancel the program. Brazil threatened to become an economic power independent of Anglo-American control and, signifi cantly, independent of their oil blackmail.

Mexico, which during the early 1970s was not yet a signifi cant exporter of oil, for sound economic reasons made the decision to develop nuclear power for electricity as part of its plan for rapid industrialization, while conserving its oil ‘patrimony’ for other uses, such as earning export dollars. As an initial part of its nuclear program, Mexico entered into contracts with Mitsubishi of Japan and Siemens of Germany. In 1975, in the wake of the fi rst oil shock, Mexico’s National Energy Commission decided that it was wasteful and ineffi cient to burn hydrocarbons to produce electricity. They announced plans to build 15 new nuclear power reactors over a 20-year period.

Pakistan, under the government of Prime Minister Zulfi kar Ali Bhutto, responded to the 1974 oil shock by accelerating work on an earlier small-scale nuclear energy program. Bhutto had withdrawn Pakistan from the British Commonwealth of Nations, in order to pursue an independent national development policy.

The Bhutto government entered negotiations with France on construction of a nuclear fuel enrichment plant for Pakistan, which were fi nalized in March 1976. Pakistan was developing into an effective lobby throughout the Middle East on the importance of developing nuclear energy in addition to oil resources. By August 1976, the U.S. State Department, and Henry Kissinger in person, launched a major pressure campaign on both France and Pakistan to abort the nuclear deal, claiming it was related to nuclear weapons ambitions, despite Pakistan’s approval from the International Atomic Energy Agency that there were suffi cient safeguards to ensure that this would not be the case. According to Pakistani accounts, earlier that year in Lahore, Kissinger had delivered a direct threat ‘that he would make a horrible example of Pakistan’ if Bhutto did not abandon the nuclear reprocessing project negotiations with France.

In 1977, Bhutto was overthrown in a military coup led by General Zia ul-Haq. Before his death by hanging, Bhutto accused U.S. Secretary of State Henry Kissinger of being behind his overthrow because of Bhutto’s insistence on developing Pakistan’s independent nuclear program. Writing his defense from his prison cell before his execution, Bhutto declared:

Dr. Henry Kissinger, the Secretary of State for the United States, has a brilliant mind. He told me that I should not insult the intelligence of the United States by saying that Pakistan needed the Reprocessing Plant for her energy needs. In reply, I told him that I will not insult the intelligence of the United States by discussing the energy needs of Pakistan, but in the same token, he should not insult the sovereignty and self-respect of Pakistan by discussing the plant at all … I got the death sentence.8

General Zia reversed Bhutto’s independent foreign policy and quickly embraced Washington. Abundant U.S. military assistance followed.

But by all measures, the most impressive commitment to nuclear energy by a developing sector country in the wake of the 1974 oil shock came from the Shah of Iran. The Shah, who owed his position

to the coup staged by British and American intelligence in 1953 to overthrow the nationalist Mossadegh regime and reinstate a ‘proAmerican’ monarchy, had appeared to be a grateful recipient of American military supplies and other support over more than 20 years. He had even agreed to initiate Henry Kissinger’s call for an increase in the OPEC benchmark oil price to $11.65 per barrel at the January 1974 OPEC meeting.

But with the new oil revenues fl owing in to the state treasury, the Shah saw the opportunity to realize an old dream. Iran would use its oil wealth to create one of the world’s most modern energy infrastructures, built upon nuclear power generation, which would transform the electricity and other power needs of the entire Near East.

By 1978, Iran had the fourth largest nuclear power program in the world and the largest by far among Third World nations. The Shah’s plan called for the installation of 20 nuclear power reactors by 1995, to provide some 23,000 megawatts of electricity. The Shah saw nuclear electricity as the rational means to diversify Iran’s dependence on petroleum, and as a means to counter the enormous pressure from Washington and London to recycle his petrodollars to New York and London banks.

The major negotiating partners with whom the Shah negotiated his nuclear program were France and Germany. As early as 1974, Iran had signed a provisional agreement with France to construct fi ve nuclear power reactors and a nuclear research center. This was expanded in 1975 to eight reactors, for a total cost of $8.6 billion. In addition, Iran purchased a 10 per cent share in the French uranium enrichment facility being constructed at Tricastin, and lent $1 billion for its construction.

In 1976, Iran signed a contract with the German nuclear fi rm, KWU, for 7.8 billion Deutschmarks, for two reactors and infrastructure; this was followed in 1977 by a contract to supply four more reactors for an added 19 billion Deutschmarks. In addition, Iran under the Shah invested in key European industrial companies, including a 25 per cent stake in the German Krupp, and in French nuclear enrichment facilities. The economic bonds between Iran and Continental Europe were growing in importance. During this time, under the strict antinuclear regime of U.S. President Carter, the United States did not participate in backing the export of U.S. nuclear reactor technology, and Washington tried strenuously to block the German and French deals, to no avail.