On May 15, 2007, Sergey Kiriyenko, the head of the Russian Federal Nuclear Agency (Rosatom), and U Thaung, Minister of Science and Technology of Myanmar, signed an agreement on construction of a nuclear research center in Myanmar, including a research reactor fueled with low-enriched uranium. Announced while U.S. Secretary of State Condoleezza Rice was visiting Moscow, the agreement immediately caught U.S. and international attention, stirring considerable debate as to the merits of the deal.

One reason for the international scrutiny of the transaction is that Myanmar has been the focus of international concern because of its human rights record. Formerly known as Burma, Myanmar has been ruled by a military junta since 1988, which, after refusing to honor the results of the country’s 1990 elections, has marginalized the country’s leading opposition party, the National League for Democracy, and placed its leader – Nobel Prize winner Aung San Suu Kyi – under house arrest. As a result, Myanmar is under U.S. and European economic sanctions and has avoided UN Security Council intervention on humanitarian grounds only because of the opposition of Russia and China, two veto-holding permanent members of that body.

The Myanmar nuclear project will be implemented by AtomStroiExport, the subsidiary of Rosatom in charge of construction of nuclear reactors and power plants abroad. The nuclear research center will include a 10 megawatt light-water reactor using uranium enriched in uranium-235 to a level “not exceeding” 20 percent, material that is not suitable for use in nuclear weapons. [1] According to a statement released by Rosatom, the center will also incorporate an activation analysis laboratory, a medical isotope production laboratory, a nuclear silicon doping system, and nuclear waste treatment and burial facilities.[2] According to Rosatom Press Secretary Sergey Novikov, Russia will supply the first 10 tons of fuel, which will then be followed by fuel deliveries coordinated by the Vienna-based International Atomic Energy Agency (IAEA). [3]

The agreement also provides for training of some 300-350 Myanmar citizens to work at the future research center. [4] According to some sources, Russia has already educated nearly 1,000 Myanmar nationals, although others assert that only several dozen Myanmar students have received professional training in Moscow. [5]

Russian officials sought to cast the deal as a positive step in Myanmar’s efforts to develop nuclear energy for peaceful purposes. They repeatedly emphasized that as a party to the nuclear Nonproliferation Treaty since 1992, Myanmar has a legitimate right to pursue the development of nuclear energy for peaceful uses. [6] Rosatom Press Secretary Novikov also noted that the research center will be put under IAEA safeguards to ensure it is used only for peaceful purposes, although officials in Vienna claim they have not been informed or otherwise consulted “about the construction of any nuclear facility” in Myanmar. [7] Like most developing countries, Myanmar has not adopted a voluntary “additional protocol” to its safeguards agreement, a step that would expand the agency’s inspection rights.

History of the Project
The Russian project has a long history. Myanmar has been keen to acquire a nuclear research center for many years, as part of its broader technological development program. Government officials have argued that the center is needed to support the country’s agricultural and medical sectors and to lay the foundation for a future nuclear power generation program. In December 2002, the first reported meeting on the project took place in Moscow, between Science and Technology Minister U Thaung and his Russian counterpart at the time, Russian Minister of Atomic Energy Evgeniy Adamov. Available accounts vary as to whether Russia or Myanmar initiated the exchange. [8] Called on to provide financial support and facilitation of the acquisition of a nuclear research center, IAEA officials made two visits to Myanmar in 2001 and 2002 to evaluate the country’s level of preparedness. [9] The IAEA assessment revealed that “the safety standards in place were well below the minimum the body would regard as acceptable.” [10] Nevertheless, Russia concluded a bilateral nuclear agreement with Myanmar in 2002. The implementation of the agreement was delayed, however, when Russia became concerned that Myanmar would not be able to cover the cost of the facility’s construction in advance. [11] It is also possible the IAEA’s warning about Myanmar’s capacity to ensure safe and secure operation of the center contributed to Moscow’s decision to slow the project. [12]

The project remained attractive for both partners, however. Myanmar continued to be interested in the Russian nuclear research facilities in part because of their relatively low price, estimated at $5 million in 2002. [13] Russia’s willingness to provide the facilities and related support was also appealing because Moscow did not attach conditions related to human rights issues in Myanmar and because the added links with Russia would serve Myanmar’s desire to offset China’s growing influence in the country. [14] Russia, on the other hand, was keen to enlarge its list of potential nuclear customers and, building on this and its long history of arms sales to Myanmar, hoped to expand economic cooperation with Myanmar more generally, to gain access to its substantial mineral resource base. Thus, in April 2006, Russia’s Kurchatov Institute received a delegation from Myanmar headed by Vice-Senior General Maung Aye – the deputy chair of the State Peace and Development Council (SPDC), which is the highest executive and legislative body in Myanmar – and roughly one year later, the second agreement on the construction of a nuclear research center in Myanmar was signed. [15]

The United States has questioned the motivation behind Russia’s decision to build a nuclear reactor in economically backward and politically isolated Myanmar. Other observers have noted, however, that the project makes economic sense for Moscow, because Myanmar has improved its financial standing in recent years and is now able to cover the construction and maintenance costs of the future research center. The Economist, for example, has noted that while the earlier “plan stalled over payment…now Myanmar, flush with an annual trade surplus, says it will pay cash.” [16] This is in startling comparison to the situation in 2002, when it was projected that Myanmar would have to cover construction and maintenance costs by barter transfers to Russia of food stocks (such as rice) and other commodities (such as teak wood and rubber). [17]

Proliferation Concerns
While analysts do not attribute Myanmar’s interest in the center to a desire to pursue a nuclear weapons program, a number of questions have been raised regarding the safety, security, environmental, health, and proliferation risks the new installation may pose. [18] The United States promptly expressed its discomfort with the deal, warning that the reactor may pose certain technical and environmental safety risks, and could present proliferation risks as well, stemming chiefly from “the possibility of fuel being diverted, stolen or otherwise removed.” [19] State Department spokesman Tom Casey noted that Myanmar “has neither the regulatory nor the legal framework or safeguard provisions or other kinds of things that you would expect or want to see for a country to be able to handle successfully a nuclear program of this type.” [20]

Russian officials sought to dispel any potential proliferation concerns arising from the deal, claiming that the civilian nuclear energy industry “is very developed and very safe from the point of view of nonproliferation.” [21] Despite critics’ allegations of the existing links between Myanmar and states of concern, such as North Korea and Iran, most analysts seem to agree with the overall assessment that the arrangement raises few proliferation concerns. [22]

Russian non-governmental sources have been critical of the deal, however. While advocates of the project claim Myanmar has a consistent record of supporting international and regional nonproliferation and disarmament initiatives, some Russian experts argue that proper operation of a reactor can only be guaranteed where a solid technological base and political stability are present. [23] According to one Russian news service, “From the very beginning, construction of a nuclear reactor in that Asian state has looked like a challenge.” It continued, “From the point of view of the international community, Myanmar is a country with a classic dictatorship,” implying that Myanmar was not an appropriate candidate to be rewarded with a nuclear project from a major power. [24] It does not seem, however, that these considerations will affect the Rosatom project.

Conclusion
Russia is now trying to downplay the significance of the Myanmar project and assuage concerns by focusing on the peaceful use of the future reactor, as well as noting that the specifics of the deal have yet to be worked out. Indeed, no official decision has been made with regard to “the site, cost and detailed logistics” of the future research center. [25] Negotiations are scheduled to continue in the second half of 2007 in Myanmar. [26]

Russia’s behavior is indicative of the country’s difficulties in finding nuclear markets that are not already dominated by Western firms at a time when reform of the Russian nuclear industry to make it more profit oriented has heightened the need for revenue from foreign trade. This new search for profits has led Moscow to deal with states like Myanmar and Iran, which have been shunned by AtomStroiExport’s Canadian, French, Japanese, and U.S. competitors. AtomStroiExport’s recent loss to Westinghouse of a major nuclear power plant contract in China was the latest reminder of the challenges Russia faces in competing with its Western counterparts. [27]


Marina Mateski and Nikolai Sokov – Monterey Institute Center for Nonproliferation Studies