Iran Agrees to Halt All Uranium Enrichment Activities

The United Nations nuclear watchdog
said that Iran has agreed to suspend all uranium enrichment
activities, according to a resolution passed by the International
Atomic Energy Agency in Vienna.
The accord was reached after Iran sent a letter yesterday
withdrawing its request to exempt 20 nuclear centrifuges and
allowing them to be put under surveillance, said Hossein
Mousavian, head of the Iranian delegation to the IAEA. He added
that Iran was co-operating ``in full transparency.''
The IAEA ``welcomes the fact that Iran has decided to
continue and extend its suspension of all enrichment-related and
reprocessing activities,'' according to a copy of the resolution
obtained by Bloomberg News. The agency emphasized that although
the suspension is voluntary, ``it is essential for confidence-
building'' in the international community.
The resolution, drafted by negotiators from Britain, France,
and Germany, was adopted today by consensus by the IAEA board of
directors. The accord may lead to Iran having more trade with the
European Union. The U.S. has accused the Islamic republic of
running a clandestine nuclear weapons program and says it should
be subject to UN sanctions.
Iran, the second-largest oil exporter in the Middle East,
has said it wants to enrich uranium only for nuclear energy.
Centrifuges spin at supersonic speeds and can enrich uranium
hexaflouride gas, which can be used in atomic weapons.

U.S. Reaction

White House spokesman Scott McClellan said the IAEA ``will
need to remain vigilant'' and continue to verify Iran's
compliance.
Jackie Sanders, President George W. Bush's envoy on nuclear
non-proliferation, told the IAEA board that the U.S. maintains
that Iran has a nuclear weapons program which ``poses a growing
threat to international peace and security.'' The U.S. also
retains the right to bring Iran before the UN Security Council
for possible sanctions without the IAEA's backing, she said.
The resolution also asks the IAEA's director general Mohamed
ElBaradei to report on Iran ``as appropriate'' and drops the
country from the agency's mandatory agenda at its next meeting in
March.
``This is a positive step in the right direction that
mitigates international concern and builds confidence,'' said
ElBaradei, adding that the disputed centrifuges are now under
camera surveillance.
The IAEA will make sure ``that there are no undeclared
nuclear materials or activities in Iran,'' the resolution said.
Iran will start talks with the EU on trade and technology
Dec. 15, said Mousavian, who expects results in three months.
Iran's suspension of enrichment-related activities will last
as long as progress in talks with the EU is being made, said
Sirius Naseri, a member of Iran's delegation to the IAEA.
Negotiations with the Europeans were ``excruciating but
friendly,'' he said.

Iran's Suspension of Uranium Enrichment Incomplete


The United Nations nuclear watchdog
said Iran's suspension of its uranium enrichment program isn't
yet complete and that it hoped to resolve Iran's request
regarding 20 centrifuges in the next day.
``We have completed our work with regard to verification of
the suspension with one exception, and that's a request by Iran
to exempt 20 centrifuges for research and development without
using nuclear fuel,'' said Mohamed ElBaradei, director general of
the International Atomic Energy Agency in Vienna.
The U.S. has accused Iran of running a clandestine nuclear
weapons program. Iran, the second largest oil exporter in the
Middle East, says it wants to enrich uranium for nuclear energy.
The Islamic Republic told the IAEA that it would stop activities
like producing uranium hexaflouride gas and making centrifuges to
build international confidence.
The use of centrifuges, which are needed to enrich uranium,
is prohibited under the terms of an agreement with the European
Union. Iran negotiated a halt to uranium ``enrichment-related''
activities with French, German and U.K. diplomats last week.
Iranian President Mohammad Khatami today criticized the IAEA
and said the EU accord was ``not good,'' Agence France- Presse
reported, citing Iranian state television.
``Intense negotiations are currently under way between non-
aligned states and the Europeans to change the draft,'' AFP cited
Khatami as saying.

`Ambiguous'

Gary Saymore, director at London's International Institute
for Strategic Studies, said that Iranians ``in the near term''
want to leave the uranium enrichment issue ``ambiguous.''
``The Iranians have already laid down some markers that in
the future they will resume these activities,'' said Saymore, who
served as a security advisor to two U.S. presidents, Ronald
Reagan and Bill Clinton.
Iran's diplomats have in the past dismissed requests to
permanently suspend uranium enrichment, citing rights under the
Nuclear Non-Proliferation Treaty. All signatories of the 1968 NPT
are allowed to enrich uranium as long as the activities are for
producing energy and declared to the IAEA. Iran ratified the
treaty in 1970.
The EU accord with Iran isn't ``a legal obligation,'' said
IAEA spokesman Mark Gwozdecky in an interview with the Cable News
Network. Iran needs to ``build confidence'' in the international
community after hiding its nuclear program for 20 years,
Gwozdecky said.

Washington's View

``The European Union has some cards to play,'' Saymore said,
referring to the ongoing negotiations to increase trade between
the EU and Iran. ``But at some point Washington will have to make
a decision whether it endorses or supports the agreement.''
Last week President George W. Bush said that the U.S. is
concerned that Iran is speeding up efforts to produce fuel for a
nuclear weapon.
``The world knows it's a serious matter and we're working
together to solve it,'' Bush said.
The IAEA can safely say that none of Iran's ``declared
materials'' have been diverted to a nuclear weapons program,
ElBaradei told reporters today. ``But we still have a lot to do
with regards to possible undeclared material,'' he said.
The IAEA will continue verifying the nature of Iran's
nuclear activities for ``many years,'' ElBaradei said.
The IAEA's board of governors is meeting in Vienna to
discuss Iran's nuclear program.

Iran Promises UN It Will Suspend Uranium Enrichment

Iran told the United Nations nuclear
watchdog that it agreed to a European Union proposal to
voluntarily stop uranium conversion starting Nov. 22, to ward off
U.S. calls that the Islamic government be subjected to sanctions
by the UN Security Council.
Iran ``decided on a voluntary basis and as further
confidence-building measures, to continue and extend its
suspension to include all enrichment-related and reprocessing
activities,'' the International Atomic Energy Agency said in a 28-
page report obtained by Bloomberg News and to be presented to the
agency's governors Nov. 25 in Vienna. ``Iran invited the Agency
to verify this suspension starting from Nov. 22, 2004.''
Iranian officials have been negotiating with diplomats from
France, Germany and the U.K. for more than a year. The U.S. says
Iran is converting uranium as part of a clandestine nuclear
weapons program. Iran, the second-largest oil producer in the
Organization of Petroleum Exporting Countries, says it needs to
process the uranium for nuclear fuel to generate electricity.
Iran has made ``good progress'' since opening negotiations
with the EU in letting IAEA inspectors verify the extent of its
nuclear program, the agency said in the report. Before 2003, Iran
was guilty of ``many breaches'' of its IAEA treaty obligations,
according to the report.
The IAEA report, to be presented by Director General Mohamed
ElBaradei, isn't the end of the agency's investigation. The IAEA
is ``not yet in a position to conclude that there are no
undeclared nuclear materials or activities in Iran,'' the
document said. ElBaradei will continue to report to the board of
governors about Iran.

EU Deal

Under the terms of its EU deal, Iran agreed to suspend ``any
activity for undertaking plutonium separation,'' the IAEA said.
Iran also said it will stop making and importing gas centrifuges
and all conversion tests.
`'We want a durable, cooperative and long-term partnership
with Iran,'' Javier Solana, EU high representative for the common
foreign and security policy, said in a statement released in
Brussels. ``This agreement opens the way.''
Solana called the agreement a ``first step, and that is very
important.''

Within `Red Lines'

Iran's suspension falls short of a total halt to uranium
enrichment. That means the issue may resurface, analysts said.
``We stayed within our red lines, and this red line meant we
could suspend enrichment but not stop it,'' Iran's Foreign
Ministry spokesman Hamid Reza Asefi told reporters in Tehran
today, Agence France-Presse reported earlier.
``There'll probably be further crises focusing on Iran's
nuclear program in future, but investors know it's part of doing
business here,'' Albrecht Frischenschlager, a partner at Atieh
Bahar Consulting, who has been advising companies such as British-
American Tobacco and Rolls Royce since 1998, said in a telephone
interview from Tehran. ``They know that tensions are often
diffused at the last minute.''
The Iranian government said in September there were
applications for $8.2 billion of foreign investment so far this
year, roughly equal to the total figure in Iran since 1997. The
fact that investments, both foreign and domestic, continue to
rise shows companies ``have learnt to cope with'' uncertainty,
Frischenschlager said.

Trade Barriers

Iran's deal with the EU could strengthen trade ties between
the regions worth $16 billion euros ($20.7 billion). In exchange
for stopping uranium enrichment, the EU had been offering Iran
civilian nuclear reactor technology and the removal of trade
barriers.
``We appreciate any deal which is clear and accepted by the
IAEA,'' said Klaus Friedrich, spokesman on export controls and
the Middle East for Germany's machinery and engineering trade
group, VDMA, in a telephone interview from Frankfurt. ``We hope
that the threat of embargo is past us.''
Europe, Iran's main trading partner, had a 2.3 billion-euro
trade surplus with Iran at the end of 2003, according to EU
statistics. Exports to Iran averaged 25 percent annual growth in
the last four years. Machinery and mechanical appliances
represent about half of all EU exports to Iran, or around 4.5
billion euros last year.
``From a machinery point of view, Iran absorbs more German
trade than India and is on the same level as Brazil, Canada and
Mexico,'' Friedrich said.

U.S. Stance

Iran hasn't run a trade surplus with the EU since 2001, when
it exported 186.3 million euros more goods than it absorbed. Oil
and oil products last year represented almost 90 percent of
Iran's exports to the EU, or around 6 billion euros.
The EU and the U.S. have differed over policy toward Iran.
The Europeans have favored more diplomacy, while the U.S. cut off
relations after its Tehran embassy staff was taken hostage for
444 days in 1979.
Unlike the EU, the U.S. prohibits most trade with the Iran
because of its alleged support of Middle East terrorist groups
such as Hezbollah. The U.S. also forbids its companies from
investing in Iran or selling high-technology goods such as
computers or aircraft there because it says the Islamic
government gives support to terrorist groups. Iran denies the
accusations.
Iran's deal with the EU may be a strategic move by the
government in Tehran to ease U.S. unilateral sanctions, according
to Atieh Bahar. Iran has regularly accused the U.S., which it
labels ``The Great Satan,'' of only using a stick while European
governments use both incentives and threats.

Jobless Rate

``The Iranians want the EU to convince the U.S. to change
its attitude toward them, and they'll use today's voluntary
suspension as a means of pressure,'' Frischenschlager said. U.S.
economic sanctions have slowed Iran's economic progress. While
the country is the second-largest oil producer in the Middle
East, it has an official unemployment rate of 16 percent. More
than four-fifths of the $110 billion economy is state-run.
``Iran's trade links are pretty undeveloped,'' said Fitch
Ratings analyst James McCormack, who rates Iran ``B+ positive.''
Fitch also rates Indonesia and Turkey B+. ``An agreement might
help at the margin but they still need a lot of investment to
increase economic output,'' he said.

S. Korea Nuclear Inspections Yield No Weapons Program

There's no evidence South Korea was
trying to make nuclear weapons when 14 of its scientists
secretly produced enriched uranium and plutonium without
government approval, the United Nations nuclear watchdog said.
The nuclear experiments yielded only small amounts of the
materials, the International Atomic Energy Agency said in an
eight-page report to be presented to the IAEA's governors later
this month and obtained by Bloomberg News. Enriched uranium and
plutonium can be used to fuel nuclear reactors or for weapons.
``The experiments were laboratory-scale,'' according to
the report. South Korea ``provided active cooperation to the
agency in providing timely information and access to personnel
and locations,'' the IAEA said. The head of the government's
nuclear research agency in Daejon was the top South Korean
official aware of the experiments, the IAEA said.
The report followed South Korea's voluntary statement to
the Vienna-based IAEA in August that the scientists enriched
uranium in 2000 without government knowledge. North Korea's
government said the South Korean revelations and a hostile U.S.
policy toward the communist nation are preventing the six-
nation talks on North Korea's nuclear program from resuming.

Laser Technologies

South Korea enriched uranium to concentrations just shy of
what would be needed to build a nuclear weapon, the IAEA said
in the report. The agency is still investigating where the
South Korean government bought the laser technologies its
scientists used for enrichment.
The enrichment took ``place in the context of a broader
experimental effort'' to apply laser technology to non-nuclear
materials, the IAEA said. The enriched uranium came from 154
kilograms (340 pounds) of uranium metal that scientists
converted from the raw version of the material during the
1980s, the report said.
Talks between the U.S., North Korea, South Korea, China,
Japan and Russia have been stalled since North Korea failed to
participate in a scheduled fourth round in September.
U.S. Secretary of State Colin Powell said last month the
forum should discuss South Korea's nuclear experiments.
``We can't say for certain when the next six-nation talks
will be held,'' South Korean Foreign Minister Ban Ki Moon said
in September. ``With recent comments from North Korea, we can't
be sure.''

Iran Refuses UN Uranium Demand, Is Rebuked by U.S. (

Iran refused a demand by the United
Nations' nuclear watchdog to halt all uranium-enrichment
activities, prompting a U.S. rebuke as the Islamic Republic faces
possible economic sanctions.
The U.S. reproached Iran today for refusing an International
Atomic Energy Agency resolution urging an immediate halt to
Iranian enrichment-related activities. The agency, which
acknowledged Iran's right to enrich uranium, asked Iran to
further open its atomic program to UN inspectors.
``Iran will drag out negotiations with the IAEA and the
Europeans, who are unlikely to agree to sanctions because of
their oil interests in Iran,'' Youssef Ibrahim, managing director
of the Dubai, United Arab Emirated-based Strategic Energy
Investment Group, said in a telephone interview.
The U.S. says Iran, which holds the world's second-biggest
proven oil reserves after Saudi Arabia, is hiding a nuclear-
weapons program and is seeking imposition of UN sanctions on the
country. New sanctions may force European oil companies such
Royal Dutch/Shell Group to stop working in Iran.
Iran won't accept any UN demand to halt the enrichment of
uranium, Hassan Rowhani, the secretary of Iran's Supreme National
Security Council, said in Tehran, the state-run IRNA news agency
reported. Iran's nuclear program is peaceful and is only intended
to generate energy, he said.

Inspections

Iran has had more than 800 IAEA inspections in the last
year, Hossein Mousavian, head of Iran's delegation to the IAEA,
said this week.
Total SA, Europe's third-largest oil company, OAO Lukoil,
Russia's top oil producer, and Norway's Norsk Hydro ASA are among
other international oil companies working in Iran. The country is
the second-largest oil producer in the Organization of Petroleum
Exporting Countries after Saudi Arabia.
The ``clock is ticking'' for Iran to stop its activities and
cooperate with the IAEA, U.S. Energy Secretary Spencer Abraham
said today in Vienna.
``We should all expect that Iran should follow the
obligations and cooperate with the IAEA,'' Abraham said at a
conference of the Global Threat Reduction Initiative, a movement
backed by the U.S., Russia and International Atomic Energy Agency
seeking to secure radioactive materials around the world.

`Dialogue'

Iran's suspension of its uranium-enrichment program since
October 2003 was voluntary and could be extended, Rowhani said.
``Only dialogue can stop us from resuming (uranium-
enrichment) activities,'' Rowhani said.
Doubts about Iran's nuclear program are gone now that the
country revealed the goals for the activities, he said. The
International Atomic Energy Agency's resolution proved that
Iran's nuclear program is peaceful, Rowhani said.
The U.S. has failed to achieve its goal of seeking a UN
Security Council resolution to impose sanctions on Iran, he said.
The Iranian official didn't rule out the possibility of resuming
nuclear talks with the U.S.
The U.S. is pleased the IAEA has set Nov. 25 as a deadline
for Iran to cease its pursuit of nuclear weapons, Jackie Sanders,
the head of the U.S. delegation, said yesterday.

Trade Sanctions

U.S. companies are prohibited from investing in Iran by
government trade sanctions. The U.S. law, known as the Iran-Libya
Sanctions Act, hasn't kept European and Asian companies from
operating there.
Shell and Spain's Repsol YPF SA signed an accord on Sept. 16
to build a liquefied natural-gas plant in Iran, which may take
years to develop. Shell, an Anglo-Dutch oil company, produces oil
from two fields in Iran and is bidding to develop more in the
country.
``The U.S. sanctions haven't hurt Iran and if the UN
sanctions are imposed I doubt they would be respected,'' Youssef
said.
Russia, which is helping Iran develop its nuclear program,
has also refused to back out of an $800 million project to build
a nuclear unit at Bushehr on the Persian Gulf, Youssef said.
Iran recently retested its Shahab-3 missile in the presence
of observers to prove it isn't afraid to use force to defend
itself from a potential attack, Youssef said.
Israel, a U.S. ally in the Middle East, destroyed the Osirak
nuclear reactor in neighboring Iraq in 1981.
Iran and North Korea are two counties that the U.S. warns
are working on nuclear weapons. Earlier this month, an explosion
in North Korea prompted speculation, dismissed by U.S. and South
Korean officials, that the country may have carried out a nuclear
test. North Korea denied making such a test.
IAEA Director General Mohamed ElBaradei said the explosion
in North Korea didn't appear to be nuclear, based on what he was
told by an IAEA sister organization responsible for monitoring
explosive devices. ElBaradei said North Korea has the plutonium
necessary for a nuclear weapon, and wouldn't rule out the
possibility that the country has tested or may be ready to test a
nuclear device.
``I do not exclude at all that they have assembled a nuclear
weapon or more than one nuclear weapon,'' he said on Cable News
Network's ``Late Edition'' program. ``They have the fissile
material. They have the industrial infrastructure.''

UN Nuclear Agency Demands Iran Suspend Uranium Enrichment

The United Nation's nuclear watchdog
agency demanded Iran cease all uranium enrichment activities and
said it will decide on Nov. 25 whether to take steps to ensure
the country's atomic program isn't a threat to the international
community.
The International Atomic Energy Agency ``considers it
necessary that Iran immediately suspend all enrichment-related
activities,'' it said in a three-page resolution. The Vienna-
based agency also demanded Iran further open its atomic program
to inspectors. It did acknowledge the country has a right to
enrich uranium.
The U.S. says Iran, with the second-highest oil reserves in
the world, is concealing a nuclear weapons program and wants it
sent before the UN Security Council for possible sanctions. Iran
says its atomic program is peaceful and only intended to generate
energy.
Iran's uranium enrichment activities have been suspended
since October 2003, and the nation will decide in coming days if
that will continue, said Hossein Mousavian, the head of Iran's
delegation to the IAEA. It is Iran's ``national right,'' to
convert uranium, he said earlier this week.
``We will continue our cooperation with the IAEA fully and
transparently to clarify and resolve any remaining issues,''
Mousavian said at a press conference after the passage of the
resolution.
Iran has had more than 800 IAEA inspections in the last
year.

U.S. `Pleased'

The U.S. is ``pleased'' the IAEA has set Nov. 25 as a
``deadline for Iran to cease its pursuit of nuclear weapons,''
said Jackie Sanders, the head of the U.S. delegation.
``The resolution calls on Iran to take confidence building
measures related to enrichment and reprocessing activities,''
Mohamed ElBaradei, the IAEA director general, said at a press
conference. ``I think people were ready to listen to Iran's point
of view, and I look forward to resolving the outstanding issues
at the board meeting in November.''
The so-called Non-Aligned Movement of nations, representing
13 of the 35 seats on the International Atomic Energy Agency's
board of governors, succeeded in making the resolution recognize
a distinction between Iran's commitment to the Nuclear Non-
Proliferation Treaty and its voluntary ``confidence building
measures'' to stop enriching uranium.

`Confidence Building'

All signatories to the Non-Proliferation Treaty are allowed
to enrich uranium as long as the activities are for producing
energy and declared to the IAEA. Iran signed an additional
protocol last year to suspend enrichment after engaging in
undeclared activities.
``We are fully cognizant of the distinct difference between
legal obligations and confidence building measures,'' Germany's
delegation said in a statement. ``Signatories of the NPT should
benefit fully from the peaceful use of nuclear energy.''
The Non-Aligned Movement has been in existence since the
1960s. It's members on the IAEA's Board of Governors come from
Cuba, Egypt, India, Nigeria, Tunisia, Vietnam, Panama, Peru,
Saudi Arabia, South Africa, Sudan, Malaysia and Pakistan. The
group is composed of more than 100 member countries.

UN Watchdog Rebukes Iran on Nuclear Questions

The United Nation's nuclear
technology watchdog has rebuked Iran for providing too
little information on its nuclear program and said it still
has questions about the country's adherence to a treaty
banning the development of atomic weapons.
The 11-page International Atomic Energy Agency report
about Iranian cooperation with international inspectors was
circulated to diplomats today, and a copy was obtained by
Bloomberg News. Mohamed ElBaradei, the IAEA director
general, will present the document to the agency's board of
governors next week.
The Vienna-based agency still has questions about the
origin of uranium found during site inspections in Iran, the
report said. Questions also remain about how and where Iran
obtained centrifuges that can be used to enrich uranium to a
concentration needed for a nuclear bomb.
The report comes as the U.S. is making a case for
increased international pressure on Iran, which says its
nuclear program is peaceful, according to the state-run
Islamic Republic News Agency.

U.S. Concern

John Bolton, U.S. undersecretary of state for arms
control and international security, said in an e-mailed
statement the report highlights ``the Iranian threat to
international peace and security.''
``We view with great concern the IAEA report that Iran
is about to convert 37 tons of 'yellowcake' uranium into
uranium hexaflouride gas, as well as Iran's recent
announcement that it intends to test its gas centrifuges,''
said Bolton.
``Iran's announcements are further strong evidence of
the compelling need to take Iran's nuclear program to the
Security Council,'' he said.
The U.S. is pushing for the IAEA's board of governors
to censure Iran for non-compliance with the nuclear non-
proliferation treaty and send the matter to the UN Security
Council.
The IAEA praised Iran for its cooperation in some
areas. Iran's declarations about its laser enrichment and
uranium conversion activities are ``consistent'' with the
IAEA's findings. The agency also ``welcomes Iran's
willingness to discuss'' nuclear activities at the Lavisan-
Shian site in Tehran.

Iran's Reaction

Hamid-Reza Assefi, spokesman for the Foreign Affairs
Ministry, said the report vindicated Iran, according to the
Islamic Republic News Agency
``Iran is determined to abide by all its commitments
within the framework of the nuclear non-proliferation treaty
and its additional protocol,'' he told IRNA.
The timing of any Iranian progress on building nuclear
weapons isn't clear. The Reuters news agency quoted Bolton
earlier this month as saying that France, Britain and
Germany had been informed by Iran that it could build a
nuclear weapon in three years.
The State Department couldn't confirm whether Bolton
made the statement, spokeswoman Susan Pittman said in a
telephone interview.
``It would be highly unusual for us to discuss
something like that with a third party,'' British foreign
affairs spokesman Simon Shercliff said in an interview.
Russian President Vladimir Putin yesterday discussed
Iran at a news conference in the Black Sea resort of Sochi
with German Chancellor Gerhard Schroeder and French
President Jacques Chirac, saying the Islamic republic
shouldn't be allowed to develop nuclear weapons.
Russia is involved in the construction of a nuclear
power plant in Iran.