Wednesday 5 April 2006
The Australian
by Joseph Kerr

THE international agency charged with ensuring China does not misuse Australian uranium has a budget of only a few million dollars a year to inspect the facilities in nuclear states.

The Vienna-based International Atomic Energy Agency has an inspections budget of E2.5million ($4.5million) to monitor nuclear facilities in the US, Britain, France, Russia and China.

That means an average of about $1million a year is spent checking on each of the nuclear weapons states, including China.

The inspections allocation is only a fraction of the IAEA's $510million total budget.

The Howard Government agreed this week to export Australian uranium to China under a framework similar to that used with 19 other bilateral uranium agreements.

John Howard said he had signed the agreement because he was satisfied the safeguards - both bilateral and through the IAEA - would be enforced.

But Richard Leaver, a reader in the School of Political and International Studies at Flinders University, said the IAEA's supervision of the nuclear weapons states was different to that of non-nuclear weapons states.

"From the IAEA's point of view, nuclear weapons states have already got through the nuclear weapons door," he said. "These are guys that have already got a bomb ... They tend to regard it as a second-range activity."

He said the agency spent more on policing non-nuclear states because it viewed that as closer to its core activity of stopping the spread of nuclear weapons. A spokesman for the Department of Foreign Affairs said that while the IAEA's budget for policing all five nuclear powers was about E2million, there were "additional extra-budgetary resources that are used for some activities in nuclear-weapons states".

Not all the additional resources were shown in the IAEA budget, he said, and there were moves to establish a uniform form of accounting across all the organisations within the UN.

The agency spends a much bigger slice of its budget - more than $71million a year - on policing non-weapons states.

Foreign Minister Alexander Downer confirmed yesterday that Australia had struck a deal to export uranium to Taiwan through the US - meaning Canberra is now exporting the controversial energy source to countries on both sides of the Taiwan Strait.

"The Chinese have been pretty relaxed about it," Mr Downer said. "The Chinese view, as I am advised by my department, is they would rather we had this arrangement than we didn't."

Minerals and energy groups yesterday welcomed news that Queensland Premier Peter Beattie was prepared to allow a new uranium mine in his state if the federal Labor Party dumped its three-mines policy.

Opposition Leader Kim Beazley was again forced to defend Labor's policy of allowing only three uranium mines, with the Chinese deal expected to deliver a huge boost in demand for Australian yellowcake. He said the party would take its time to review the policy so it got it right.