Volume Two
Section D Arms and Defence-Related Exports to Iraq
Chapter 5 Iraqi Arms and Defence Equipment Procurement
after the Cease-Fire

Excerpt:
LIEUT-COLONEL GLAZEBROOK’S IRAQ ARMS MANUFACTURE PAPER

D5.64 The previous paragraphs of this Chapter have described the accumulation by the intelligence agencies of information about Iraqi arms procurement intentions and activities in the period following the ceasefire and preceding the Iraqi invasion of Kuwait. This information enabled an accurate view to be formed by the agencies about, for example, the use to which machine tools destined for Project 1728, for Project 144 (which included ABA), for the Cardoen Project at Nahrawan or for Nassr’s Central Tool Room Project were likely to be put, or, in some cases, were going to be put. It led, also, to the setting up of the Working Group on Iraqi Procurement (WGIP). *157 Similar conclusions were being reached by Lieut-Colonel Glazebrook, but without the assistance of all the intelligence available to the agencies. Lieut-Colonel Glazebrook’s conclusions were based on the type and quantity of Iraq ELAs that were crossing his desk. He gave evidence to the Inquiry of how it was that his suspicions were aroused.

D5.65 On 7 June 1989, Lieut-Colonel Glazebrook, together with the other members of the MODWG received the lists of ELAs and AWP applications due for consideration at the MODWG meeting to be held on 15 June. A sight of the items on the list served to crystallise concerns he had begun to have about the build-up of military manufacturing capability in Iraq. He told the Inquiry that earlier in the year he had been to a COCOM Committee meeting where a delegate from Germany had, in informal conversation, described how Libya, by placing a number of orders in a number of different countries for small quantities of equipment, had succeeded in building a chemical plant. Lieut-Colonel Glazebrook said: “.... seeing the [ELAs] passing in front of us month by month, I came to the conclusion that the same thing was happening on arms manufacture for Iraq, that we were getting lots of little orders, and it was only when you aggregated them together into a total that you realised the scale on which the Iraqis are building up an arms manufacturing capability.” *158

D5.66 Lieut-Colonel Glazebrook voiced his concern at the MODWG meeting on 15 June 1989. He drew particular attention to the four Matrix Churchill ELAs (3G/22351/89, 3G/23006/89, 3G/52039/88 and 3M/0440/88), and, after discussion, agreed to produce a paper for the MODWG to put to the Minister (DP) explaining the concern. *159 Accordingly, he prepared a draft paper entitled “British Assistance to the Emerging Iraqui (sic) Arms Industry” and, on 26 June 1989, submitted the paper to two colleagues, Mr J, DI (Defence Sales), and Mr Fletcher, a scientific and technical expert at the MOD, for comment. 160 Paragraph 1 of the paper referred to the conversation with the German COCOM delegate. The paper then continued:

“2. The Ministry of Defence Working Group (MODWG) believes that a similar situation is building up, regarding the amount of assistance that ‘UK Ltd’ and in particular our machinery manufacturers, are giving to IRAQ towards the setting up of a major arms R&D and production industry.

3. This paper, apart from the DIS annex, is UNCLASSIFIED because the information it contains is in the public domain already. All it needs is someone like an investigative journalist to pull together the threads.

Aim

4. The aim of this Paper is to draw the attention of the Minister to the way in which ‘UK Ltd’ is helping Iraq, often unwittingly but sometimes not, to set up a major indigenous arms industry.

Intelligence

5. The fact that Iraq had a plan to develop its own major arms industry was reported first from intelligence sources. Details of this and of how one UK based company is avoiding UK export controls by shipping via a subsidiary in Singapore, is set out in Annex A (which is on a limited distribution).”

D5.67 Paragraph 6 of the paper which gave examples “of a few of the export licence applications which help to ‘build up’ the wider picture”, referred to an annexed list (Annex B) of ELAs “which in retrospect the MODWG believe could contribute to the setting up of an indigenous arms industry” and commented that “the vast majority of manufacturing equipment and R&D material which will be needed is not licensable and so, in all probability, Annex B represents less than 10% of what the UK has been contributing in the past 12 months.” The paragraph 6 examples related to electronic components for a research and development centre, vacuum precision furnaces capable of manufacturing aircraft engine components, steel ingot moulds for the manufacture of gun barrels and tank parts, a mould measuring machine and Matrix Churchill lathes and machines “sufficient to equip a factory designed to produce 500,000 x 155mm shells per annum.” Examples were given, also, of applications “for technology transfer to Iraq to set up complete production lines”. These applications related to a national electronics manufacturing complex, a manufacturing facility for thermal batteries “used chiefly in missiles and shells” and a parachute factory “for a variety of parachutes i.e. personal, load-bearing, high- speed and small for flares etc.”.

D5.68 The paper then set out the conclusions to be drawn:

“7. THE MODWG is in no doubt that Iraq, for understandable reasons, has several major programmes underway to extend its indigenous arms industry. What has not been clear is the extent of the contribution from the UK.

8. Items recently pinpointed are:

a. A major R&D facility.
b. A national electronics manufacturing complex.
c. Foundries designed to produce special steel for gun barrels and tank parts.
d. Machinery to make gun barrels and shells.
e. Specialist factories/production lines for parachutes or thermal batteries.

9. Taken individually, many of the items are relatively or wholly innocuous but put together they represent:

a. A very significant enhancement to the ability of IRAQ to manufacture its own arms and thus to resume the war with IRAN.
b. The ability to compete with the UK for a share of the WorldMarket.
c. An accumulation of technological know-how and machinery which will be harmful if passed to its close ally, the Soviet Union.

Recommendation

10. The Minister should be made aware of this unfolding situation, especially since it could reach the Press. From the point of view of both military and security concerns, the MODWG would like to see a tightening up of the Guidelines on the release to Iraq of items which could be associated with the setting up of an arms industry. However the MODWG recognises the existence of political and economic factors and that at the moment, they are not allowed to be as strict as they would wish.”

D5.69 The comment in the last sentence of the paper that the MODWG “are not allowed to be as strict as they would wish” was prompted, Lieut-Colonel Glazebrook told the Inquiry *161, first, by the direction, given by Lord Howe in December 1984, that officials applying the Guidelines should bear in mind the need not to prejudice civil trade, and, secondly, by an instruction given by Mr Barrett to the MODWG on 14 April 1989, confirming “the interpretation of the guidelines which Ministers had agreed”, namely, that ELAs for the export to Iraq of non-lethal items were to be refused “only if they represented a significant enhancement to Iraqi capability to break the ceasefire”. He said that “DESS and DESO had argued strongly that machine tools did not come into this category, and so, despite the fact that we, the MOD Working Group, had recommended they should be turned down as a refused enhancement, there was a strong possibility that that would be overturned ...”. *162 In his written statement dated 29 April 1993, Lieut-Colonel Glazebrook referred to “an increasing insistence by the Department of Trade and Industry that dual-use goods (i.e. items which could be used for civil or military purposes) should be refused only if there was firm evidence that the end-use was to be military. Firm evidence was defined as evidence which should prove conclusive..” *163

D5.70 The draft paper which Lieut-Colonel Glazebrook had prepared was circulated to the MODWG members at the meeting on 14 July 1989. The draft paper was accompanied by a Note dated 14 July 1989 in which Lieut-Colonel Glazebrook said that the draft would be “held up pending agreement by the DIS” and suggesting that, in the meantime and until Ministerial guidance could be obtained, a number of applications on the current lists, including the four Matrix Churchill ELAs, should be marked “pending”. At a later MODWG meeting, on 14 September 1989, it was decided that a new marking “RAM”, *164 to signify refusal on the grounds that the goods probably would be used for arms manufacture, should be used. The Matrix Churchill ELAs were, accordingly, marked ‘PAM’ or ‘RAM’ by the MODWG. *165 So, too, were a number of other applications, all believed by the MODWG to be related to an Iraqi intention to establish an indigenous arms manufacturing capability.

D5.71 After being submitted to the MODWG in July 1989, the draft paper was left in abeyance pending the completion by DIS of the report which would become Annex A. Lieut-Colonel Glazebrook told the Inquiry that the paper “needed an Annex Alpha, a defence intelligence report, summing-up the intelligence information on how arms manufacturing in Iraq was going” and that he “had been made aware in June/July .... that the DIS as part of a series of papers, were producing one on this general subject, and the DIS representative to the Working Group had volunteered that an extract from that, when the paper was completed, could be used to form Annex A.” In the meantime, the relevant applications would be kept pending.

D5.72 In the event, the proposed DIS Annex was never completed and Lieut-Colonel Glazebrook’s paper was never brought to the attention of Ministers and simply fell into limbo. It would have been for Mr Barrett, or perhaps Mr McDonald, to have brought the paper and the apprehensions contained in it to the attention of the Minister (DP).

D5.73 Mr Barrett defended his view that it would have been inappropriate to have brought Lieut-Colonel Glazebrook’s paper to the attention of Ministers, first, on the ground that the paper was, in the absence of the DIS Annex, inchoate and, secondly, on the ground that Ministers were, in any event, well aware of the Iraqi procurement network. *166 He explained the position in this way: “The actual content of [the paper] was not actually saying anything new. I could not tell the Working Group about Habobi and the Iraqi procurement network because that was something which was being considered in a special forum .... it was a covert operation, but we were taking action on [Lieut-Colonel Glazebrook’s] concerns. They were being considered as part of that total action, which Ministers had set up to monitor the procurement network” *167, and “The feeling that Colonel Glazebrook had was that the Iraqis were setting up a major indigenous arms industry. I think there was a fair amount of evidence that they already had a major indigenous arms industry anyway. What the WGIP was concerned about and Ministers were concerned about was the development of an indigenous industry for missile production and nuclear production and so on, which went far further than this”. *168

D5.74 Mr Barrett’s perception, and his attribution of it to Ministers, that the real concern lay in Iraqi capability for manufacturing missiles and nuclear weapons echoes the evidence given to the Inquiry by the SIS witnesses and given also by Mr Alan Clark, the then Minister (DP). At the WGIP meeting on 8 December 1989, Mr Barrett drew attention to the items on the IDC lists which had been marked ‘PAM’ “because of their sensitivity in relation to indigenous arms manufacture.” *169 Mr Barrett regarded the setting up of the WGIP as evidencing the recognition by Government of the importance of Iraq’s developing arms manufacturing capability. *170 At the WGIP’s opening meeting on 23 June 1989 he had drawn attention to some of the ELAs currently being assessed, including those from Matrix Churchill, and had informed the meeting that the MOD “were drawing up a list of all equipment which looked suspicious” and would liaise with SIS. *171

D5.75 Mr McDonald, unlike Mr Barrett, did not receive or see a copy of Lieut-Colonel Glazebrook’s paper. He was made aware by Mr Barrett that members of the MODWG were expressing “concern about the cumulative effect of UK dual use exports to Iraq” *172 but his evidence to the Inquiry was that Mr Barrett had said “the case was not made and we would have to see the intelligence input.” Mr McDonald, like Mr Barrett, gave as reasons for not taking action on Lieut-Colonel Glazebrook’s paper that the DIS Annex was being awaited and that “everyone knew that Iraq was .... taking action to build up an indigenous armament manufacturing capability”. And he, too, drew a distinction between conventional weapons and weapons of mass destruction: “.... the very first thing I would want to do would be to make sure that Ministers recognised the difference between the weapons of mass destruction .... which has an international flavour, and dealing with conventional weapons, in which at that time there was no international or multi-lateral flavour.” *173

D5.76 In the result, important decisions were taken on ELAs, in particular on the Matrix Churchill ELAs considered by Ministers at a meeting on 1 November 1989 *174, without Lieut- Colonel Glazebrook’s paper being brought to the attention of Ministers. I am not in any doubt that if the paper had been drawn to the attention of Mr Alan Clark, the then Minister (DP), it would have made no difference at all to his (the Minister’s) attitude of support for the Matrix Churchill ELAs. If it had come to the attention of Mr Waldegrave it might have enabled him (Mr Waldegrave) to stand firm and oppose the ELAs.

D5.77 The Ministerial decision to grant the Matrix Churchill ELAs, reached at the 1 November meeting, was reported by Mr Hextall to the MODWG meeting held on 8 November 1989. Lieut- Colonel Glazebrook expressed his concern both at the meeting and in a Note dated 10 November 1989 to Major-General Blacker, ACDS OR (Land). *175 In the Note, after referring to his proposal that “a Paper should be put to Ministers, expressing the concern of the WG at the build up of the arms manufacturing capability in Iraq” and to the recent decision “to support the export of several Matrix Churchill lathes to Iraq”, Lieut-Colonel Glazebrook recorded his concern “that Min (DP) may have made his decision on the basis of inadequate information on the overall situation”. *176 Copies of the Note were sent to the MODWG members. Mr Hextall’s manuscript comment dated 15 November to Mr Barrett was: “Col G gave us a rough ride on Matrix and other P(AM) cases to the MODWG .... I countered that Min (DP) was fully briefed.”

D5.78 After sending the Note to Major-General Blacker, Lieut-Colonel Glazebrook spoke to him about the matter. It was agreed that they would await the DIS report that was being prepared and, in the light of its contents, decide what else needed to be done. The next MODWG meeting was on 6 December 1989. The meeting was chaired by Mr Barrett who gave a résumé of the basis on which the decision to grant the Matrix Churchill ELAs had been taken. Lieut-Colonel Glazebrook’s note of Mr Barrett’s remarks reads “Matrix Churchill, [Minister (DP)] had DESS and FCO brief, destination known to make arms. Nothing to link lathes with missile production. Parts of large [organisation] which makes arms. Ministers had ‘all the evidence’ necessary to make the decision.” *177 Lieut-Colonel Glazebrook told the Inquiry that since he “had been assured by a senior civil servant [i.e. Mr Barrett] that Ministers had had all the evidence that was necessary” he concluded that there was no point in taking his protest any further. Major-General Blacker agreed that as Ministers had had the necessary evidence and had taken their decision, the issue should be left. *178

D5.79 At this stage it was still believed by Lieut-Colonel Glazebrook that, in due course, the DIS Annex to his paper would be produced. I have been unable to understand why it was that the Annex never was forthcoming. Mr Barrett suggested that the preparation of the Annex had insufficient priority for DIS purposes. DIS, he pointed out, had limited resources and worked to priorities agreed by the JIC, by Ministers and by the Chief of Defence Intelligence (CDI). It was not open to Lieut-Colonel Glazebrook nor to himself to insist on rapid production by DIS of the awaited Annex. Mr Barrett did say that he had tried to impress on DIS the importance of completing the Glazebrook paper but had been told quite firmly “we have a lot of tasks. This is just one of them.” I have carefully reviewed Mr Barrett’s evidence of the steps he took to obtain from the DIS the proposed Annex. *179 There is no documentary indication, either on DESS files or on DIS files that he took any steps at all. In the circumstances I do not feel able to accept Mr Barrett’s recollection of his conversations with “people in the DIS” to which he referred in his evidence. I do not believe that any effort at all was made by Mr Barrett or anyone in DESS to obtain from DIS the report that the Glazebrook paper contemplated. The fundamental reason for this, and the fundamental reason why no step was taken to inform the Minister (DP) or any senior MOD official of the concerns underlying the Glazebrook paper was, in my opinion, that neither Mr Barrett nor Mr McDonald regarded the paper as of any real weight or importance. I do not mean by this that they regarded the subject of Iraqi arms procurement as being of no importance. Mr Barrett’s positive steps in June and December 1989 to draw suspicious ELAs to the attention of the WGIP demonstrates that he did regard the subject as important. But he did not, on my assessment, regard Lieut-Colonel Glazebrook’s paper as contributing anything of value to the subject.

D5.80 The JIC paper placed before Ministers for the purpose of the OD meeting on 19 July 1990 contains a valuable survey of Iraqi procurement efforts in respect of strategic weapons systems. *180 The paper referred to the considerable lengths to which the Iraqis would go to mislead as to the true purpose of their purchases:

“Large scale projects are often deliberately broken down into smaller constituent parts or processes, with each being separately procured, perhaps in different countries. This diffusion serves to obscure the nature of the end product; and individual contractors or suppliers may be unaware of the ultimate function or even destination of their particular contribution (or at least can claim innocence). This procedure is assisted by the use of middlemen, and the false declaration of the end user country...” (paragraph 6).

This description by the JIC of Iraqi procurement techniques underlines the prescience of Lieut- Colonel Glazebrook’s paper on Iraqi procurement prepared in June 1989 but, unfortunately, allowed to wither on the vine. *181 The JIC paper, on the same theme, referred to the State Organisation for Technical Industries (SOTI) and its Technical Corps for Special Projects (TECO) as having responsibility for the Iraqi missile and supergun programmes and then continued: “They have interests in innocuous sounding organisations such as the State Establishment for Leather Industries, which was the destination for parts of a missile fuel plant, and the State Enterprise for Automotive Industry, whose Iskandariyah plant has been the destination for 1000mm barrel components for the superguns” (paragraph 13). In paragraph 14, the paper listed recent purchases:

“In recent months, State Establishments have placed orders or sought tenders (for items as diverse as gyroscopes, transducers, electronic components, carbon fibre composites, computer numerically controlled machine tools, high performance computer software for space programmes, solar cells, and a missile test stand) from a dozen countries, including Germany and the UK.”

D5.81 More particularly, the paper said this about Iraqi procurement in the United Kingdom:

“One of the indications of AK’s [Al Amn Al Khas] involvement in the procurement effort is that Safa Al Habobi, an AK brigadier, is responsible for the Iraqi-run [TDG]. This agency, which is based in London, has become increasingly involved in procurement associated with military projects, and the vetting of procurement operations by other State Establishments. We know of no similar Iraqi agency in any other country” (paragraph 12)

The paper went on (in paragraph 22) to say that in the latter 1980’s the Iraqis began purchasing European companies, including, in 1987, a 97.5% stake in Matrix Churchill in order to make parts for a possible Iraqi weapons systems project and that the firm was prepared to approach German and Japanese manufacturers for replacement machine tools for Iraq of those going from the UK were stopped by export controls.

D5.82 The JIC paper expressed these conclusions about Iraqi procurement, the main lines of which, it said, “already stand out clearly”.

“40. Iraq is determined to develop a full range of weapons to fulfil its strategic requirements. We see no sign that its programmes are seriously constrained by lack of funds; rather, we judge that if necessary, there would be cuts in the resources allocated for civil re-construction.

41. While Iraq is willing to purchase complete weapons and major components of weapon systems, its ultimate aim is self-sufficiency. Its procurement programme is increasingly linked to the development of a broad-based military-industrial infrastructure. This makes it all the more difficult to distinguish illicit and legitimate procurement activity. Much of the activity in Europe concerns legitimate trade, though the application of some items is often ambiguous.

42. Besides violating its own international obligations under, for example, the NPT, Iraq has also devoted great effort and ingenuity to circumventing the restrictions on the export of technology operated by some of the major industrial powers. Although there has never been a formal procurement network, Iraq’s efforts appear to be well directed and co- ordinated. Abroad, a major role has been played by the Iraqi-run group TDG. The Iraqis have also obtained important help with major projects from a few Western consortia...

45. Iraq has had considerable success with its procurement efforts. We judge that even if Western Governments try hard to restrict Iraqi procurement, they will, at best, only be able to slow down the development of the main strategic weapons project”.

D5.83 It is interesting to notice that decisions in principle to grant the outstanding Matrix Churchill (and Bridgeport) machine-tool ELAs were taken following the Ministerial meeting on 19 July 1990 in the full knowledge of the procurement position as described in the JIC paper.

Endnotes
*157 - see paragraph C2.73 supra

*158 - see the transcript of Lieut-Colonel Glazebrook’s oral evidence, Day 4, 11 May 1993, pp 123-4

*159 - see Lieut-Colonel Glazebrook’s written statement dated 29 April 1993, paragraphs 10(a) and (b) 160 MOD/28.1.55 and 57 to 71

*161 - see the transcript of Lieut-Colonel Glazebrook’s oral evidence, Day 4, 11 May 1993, p.133/4 and his written statement dated 29 April 1993, paragraph 10(c)

*162 - see the transcript of Lieut-Colonel Glazebrook’s oral evidence, Day 4, p 134

*163 - see Lieut-Colonel Glazebrook’s written statement dated 29 April 1993, paragraph 10(c)(3)

*164 - MOD/28.2.71. A marking ‘PAM’ was later adopted

*165 - see Lieut-Colonel Glazebrook’s oral evidence, Day 4, p. 152

*166 - see Mr Barrett’s written statement dated 27 October 1993, pp 84 and 85 and the transcript of his oral evidence, Day 38, 3 November 1993, pp 104 et seq

*167 - Ibid. p.115

*168 - Ibid. p.117

*169 - FCO/27.51: Mr Sherrington’s Note of the WGIP meeting dated 12 December 1989

*170 - see also the transcript Mr Barrett’s oral evidence, Day 38, p. 115

*171 - FCO/27.1

*172 - Mr McDonald’s written statement dated 10 October 1993, pp 65 and 66

*173 - see the transcript of Mr McDonald’s oral evidence, Day 35, 28 October 1993, pp. 39, 40 and 44

*174 - see paragraph D6.150 et seq

*175 - Assistant Chief of Defence Staff, Operational Requirements (Land)

*176 - MOD/30.2.353. Mr Hextall chaired the MODWG meeting in Mr Barrett’s absence

*177 - MOD/31.1.55

*178 - see the transcript of Lieut-Colonel Glazebrook’s oral evidence, Day 5, 12 May 1993, pp 10 to 11

*179 - see the transcript of Mr Barrett’s oral evidence, Day 39, 4 November 1993, pp 29 to 35

*180 - CO/147.2.966-981; see also paragraph D3.156 supra

*181 - see paragraphs D5.65 to D5.76 supra

* The Full report is available from The Stationery Office Ltd., PO Box 276, London, SW8 5DT.