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The Proliferation Security Initiative, known by its initials as the PSI, was formed by the United States and other concerned nations, including Australia and Japan, in May 2003. Its aim is to deter, detect and if necessary intercept at sea, on land or in the air

The decision to establish the PSI was prompted by two things. First, growing concern about weapons of mass destruction materials and technology falling into the hands of terrorists. Weapons of mass destruction are usually defined as chemical and biological agents and nuclear explosive devices. But the PSI also guards against illegal trade in radioactive materials. When packaged with conventional explosives, such material could be used for radiological, or 'dirty', bombs and detonated by terrorists as weapons of mass disruption, to create panic and fear.

The second concern that led to the PSI being established were the loopholes in current arms control treaties and arrangements. These did not adequately cover non-state actors, or terrorists. They also allowed countries like North Korea, and possibly Iran, to develop nuclear weapons under the guise of peaceful activity, by saying that they want to use atomic power to generate electricity in power reactors, or to run research reactors for scientific and commercial purposes. Instead, they use the plutonium or enriched uranium that are part of the nuclear fuel cycle to make bombs.

Strong supporter

New Zealand has become a strong supporter of the PSI. The government sent one of the country's P3 Orion maritime patrol aircraft to Japan in October 2007 to take part in a PSI exercise organised by Japan. Australia, Britain, France, Singapore and the United States also contributed planes or ships or both to the simulated interception operation at sea off Japan. New Zealand hosted a meeting in Auckland in March 2007 of operational experts from countries that participate in the PSI. New Zealand also joined around nineteen other PSI members in a 'table-top' exercise at the US Naval War College in June. A table-top exercise does not involve actual military deployments but trains the people taking part in co-ordinating appropriate responses, within and among partner countries, to a series of threats relating to possible weapons of mass destruction proliferation.

The PSI conforms with New Zealand's interest in improving counter-proliferation as well as arms control. It enables New Zealand to work more closely with its trans-Tasman ally, Australia, and also sustain security co-operation with the United States, within the constraints of the nuclear-free policy New Zealand put in place in the mid-1980s. The PSI is a voluntary programme. Countries that support the PSI Statement of Interdiction Principles issued in September 2003 remain free to take part in its activities or not, as their national interests and global responsibilities dictate. The principles specifically state that PSI activities will be consistent with national legal authorities and relevant international law and frameworks, including resolutions of the United Nations Security Council.

New Zealand was among countries that were initially concerned that the PSI might operate in ways that contravened national and international law. After all, the PSI was an initiative of the United States, one of the few nations yet to ratify the UN treaty on the law of the sea. However, the New Zealand government is evidently satisfied that the PSI is working in ways that are consistent with relevant law. It is not alone in this assessment. From eleven founding members, the PSI has expanded to include 86 declared participants, or nearly half the member states of the United Nations.

Perceived need

Why do so many countries think that something like the PSI is needed? When al-Qaeda used four hijacked civilian jet airliners to strike the United States, killing nearly 3000 people from 80 nations, the shockwaves reverberated around the world. The use of civilian planes as weapons to hit New York and Washington in September 2001 exposed a whole new degree of vulnerability in the global transport system. It also raised government and public anxiety about mass casualty terrorism to a new level. The need to act quickly and effectively after 9/11 to prevent WMD terrorism motivated the United States and the small group of likeminded partners who founded the PSI to avoid a treaty-based approach, which would have involved long and cumbersome negotiations and yielded results only slowly, if at all, given the widely differing national interests and threat perceptions of the 191 member states in the United Nations.

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Nine countries--the United States, Russia, China, Britain, France, Israel, India, North Korea and Pakistan--are known to have nuclear weapons. The West suspects Iran of seeking nuclear arms, although Teheran denies this. However, the technology, know-how and materials for making nuclear weapons are becoming more widely accessible as many nations around the world develop their scientific and industrial capacity. Some materials that circulate quite widely in the globalised economy are dual-use items: they can be legitimate trade goods or they can be misused for weapons of mass destruction.

There is a real risk that if nuclear arms control unravels any further, other countries will also go nuclear with potentially dangerous consequences for global stability. If instead of nine states with nuclear weapons, there are twenty or more, would they all have reliable command-and-control structures ? Today, there is acute concern about who may end up controlling Pakistan's nuclear weapons if political instability in that country intensifies. Having many more nuclear powers would, at the very least, heighten the risk of use by miscalculation. It would also increase the risk of rogue regimes, officials or criminals transferring nuclear explosive know-how and materials to terrorists. Mohamed ElBaradei, the head of the International Atomic Energy Agency, the UN body that acts as the world's nuclear watchdog, has warned that this is the greatest proliferation risk of all.

Serious defects

The Treaty on Non-Proliferation of Nuclear Weapons has helped to limit the number of countries that have nuclear arms. However Israel, a US ally, has refused to sign the NPT. So have India and Pakistan, arguing that it unfairly favours the five permanent members of the UN Security Council--the United States, Russia, China, Britain and France. They were the only countries with nuclear arms in 1970 when the NPT took effect.

Apart from being seen as discriminatory by some states, the NPT has a number of serious defects. It gives non-nuclear signatories the right to develop atomic energy for peaceful purposes but does not give the IAEA sufficiently intrusive powers to ensure they do not cheat. The North Korean government ran a clandestine military weapons programme for many years while in the NPT. It withdrew from the treaty in January 2003, after expelling IAEA inspectors from its declared nuclear facilities. In October 2006, North Korea carried out an underground test of a nuclear bomb using plutonium as its fissile core.

Iran's determination to enrich uranium on an industrial scale under a programme that began in secret in the mid-1980s during its war with Iraq has raised suspicions that it is seeking nuclear weapons. The five permanent members of the UN Security Council have passed two resolutions in the last year calling on Teheran to suspend uranium enrichment and other sensitive nuclear activities. They have also imposed limited UN sanctions on Iran. This has not deterred Iran from continuing to enrich uranium. As a member of the NPT, it has a right to do this--but only for peaceful purposes. If further penalties are imposed on Iran, it could follow North Korea and pull out of the NPT. A state that decides to renounce the treaty can do so with just 90 days' notice. Another flaw in long established arms control treaties is that they predate international concerns about weapons of mass destruction terrorism. The treaties were designed to halt the spread of weapons between states, not the transfer of such devices, technology and related materials from states to individuals or organisations, or between terrorist and criminal groups.

Co-ordinated approach

Before the PSI partnership was established to co-ordinate the crackdown on international shipments of WMD materials, the United States and other countries trying to halt them had to rely on ad hoc exchanges of intelligence, and interceptions and searches that mostly took place in ports or the territorial waters of concerned nations. The PSI is designed to:

* expand the reach and effectiveness of this effort not only geographically but also across the diplomatic, intelligence, law enforcement and military communities, and with the private sector;

* improve the quality and exchange of information related to illicit weapons of mass destruction shipments; and

* enhance practical co-operation to disrupt the shipments.

The eleven founding members of the PSI were Australia, Britain, France, Germany, Italy, Japan, the Netherlands, Poland, Portugal, Spain and the United States. Russia joined the PSI in June 2004, although, like China, it remains wary of both preponderant US power and some other US-led initiatives to shape the post-Cold War world. Moscow's decision to join the PSI brought all the G-8 Group of leading industrial powers into the arrangement. Canada, another G-8 member, had become a participant in early 2004.

Other Asia-Pacific nations, in addition to New Zealand, have joined the PSI. Among them are Brunei, Cambodia, Papua New Guinea, the Philippines, Singapore and Sri Lanka. Australia hosted the first PSI maritime interception exercise in October 2003. More than 20 interdiction training exercises have followed in various parts of the world, mainly at sea or in ports. Several more are planned for 2008, including one in September in New Zealand.

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Increasing trade

The PSI partnership was assembled against a backdrop of international concern at signs of an increasing trade in weapon of mass destruction-related materials. In December 2002 Spanish and US forces boarded a North Korean freighter, the So San, in the Arabian Sea. The ship was found to be carrying fifteen ballistic missiles, fuel and spare parts for delivery to Yemen. They were hidden under bags of cement in its hold. The boarding was permitted under international law because the vessel was flying no flag. It was released after the high seas search at request of the Yemeni government, an ally of the United States in the 'war on terror"

Four months later, in April 2003, French and German intelligence authorities disrupted a scheme by North Korea to use front companies to import via China 214 ultra-strong aluminium pipes from Germany. Investigators concluded that the pipes, weighing 22 metric tons, could have yielded as many as 3500 gas centrifuges for enriching uranium and turning it into weapons-grade fissile material for nuclear weapons. With the agreement of the French owner, the cargo ship Ville de Virgo carrying the pipes to Asia in a container was diverted to the Egyptian port of Alexandria, just outside the entrance to the Suez Canal. There the tubes were removed and returned to Germany, where some of those involved in the scheme were charged in court.

At around the same time the Ville de Virgo left Hamburg for Asia, another freighter departed from Japan's Kobe harbour carrying three devices known as direct-current stabilisers. Exported by a Japanese trading company, the devices can be used to regulate the flow of power to centrifuges used for enriching uranium. They can also be used in missile launchers. The shipment was destined for North Korea but was routed via Thailand and Hong Kong, where customs officials confiscated it at the request of Japan's National Police Agency.

In mid-May 2003, a month after the aluminium pipes were seized on the Ville de Virgo, North Korea nearly succeeded in acquiring 33 tons of sodium cyanide, a chemical used in making the deadly nerve agent tabun. The chemicals were purchased legally from a German manufacturer who believed the buyer was a Singapore company. But a switch was planned that would have diverted them to Pyongyang.

Black market

The exposure in February 2004 of an extensive and long-running nuclear black market that funneled weapons technology to Libya, North Korea and Iran underlined the need for better international co-operation to prevent this kind of trade. Pakistani scientist A.Q. Khan set up the network, initially to help Pakistan get the materials and know-how it needed to develop nuclear weapons and the missiles to carry them. By the time Khan made his televised confession and was placed under house arrest by embarrassed authorities in Pakistan early in 2004, his supply network had become what the head of the IAEA, HBaradei, called 'the Wal-Mart of private sector proliferation'. For example, items sent by the Khan network to Libya and Iran included centrifuges for enriching uranium to weapons-grade purity and designs for making nuclear warheads, while North Korea reportedly received about a dozen centrifuges for North Korean scientists to copy and then build their own.

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The PSI is likely to become a permanent feature of the international arms control and counter-proliferation landscape because it supplements existing treaties and multilateral arrangements, as well as national laws covering the export of strategically sensitive materials. If they fail to halt clandestine WMD programmes and shipments, the PSI is intended to provide a safety net. But like all safety nets, the PSI has holes.

First, the PSI has restricted authority under international law. At sea, national authority extends no more than twelve nautical miles from the coast. Beyond this, in international waters, the state whose flag a merchant ship flies must expressly consent before foreign warships can legally halt it--except in the case of a few 'universal crimes' such as piracy and slavery. Interceptions by PSI coastal states of vessels exercising the right of transit passage through busy shipping straits, or innocent passage through national waters, could raise contentious legal issues. So could interdictions in the exclusive economic zones of some countries, or in the archipelagic waters of island-nations such as Indonesia and the Philippines, unless the governments of those countries agree. Exclusive economic zones extend 200 nautical miles from the coast.

Illegal trade

Another problem area for the PSI concerns illegal WMD trade by land and air. While the sea is a major focus of the PSI, the programme is also intended to disrupt and deter air and land shipments. The former can be difficult to do if it involves forcing a suspect plane to land. North Korea, for example, is reported to have sent missile parts by air, as well as sea, to Pakistan and Iran, while there are said to have been reciprocal flights by Iran to North Korea. These flights are believed to have used Chinese and Central Asian airspace at a time when the countries with jurisdiction over the airspace did not participate in the PSI. In addition, some WMD overland shipments in Asia and the Middle East may pass entirely through the national territory of countries that do not support the PSI.

However, the US government says that in October 2005 it secured the agreement of almost all Central Asian states to support the PSI and take action to ensure that their land and airspace will not be abused by proliferators. But any such agreements may be easier to agree in principle than enforce in practice.

A second major weakness of the PSI is the grey areas in which it may apply. Interception of ships suspected of carrying WMD delivery systems is one of these areas. The NPT forbids the spread of nuclear weapons and related technology by members. Trade in substances that could be used to make chemical arms is banned or tightly regulated by the Chemical Weapons Convention, while the Biological and Toxin Weapons Convention outlaws the circulation of biological agents. "[here is, however, no international treaty specifically and precisely preventing the shipment of ballistic, cruise and other missiles that could be used to deliver weapons of mass destruction.

Third weakness

A third major weakness of the PSI is that participation and political support are still far from universal. A number of countries that could, if necessary, play an interception role are not in the coalition. Outsiders include Brazil, China, India, Indonesia, Malaysia, South Africa and Thailand.

These countries remain reluctant to be openly associated with a US-sponsored programme like the PSI either because they fear it may override national sovereignty and freedom of navigation, or because they do not want to be tagged as a follower of the United States. As convenor of the six-party talks on Korea, China is wary of joining the PSI because this would be taken by North Korea as a partisan and provocative move. South Korea shares Chinas concern about not wishing to alienate North Korea by openly joining the PSI as a full member. Pyongyang sees the PSI as a hostile alliance to enforce a blockade to bring North Korea to its knees.

India, a major regional naval power, has held joint naval exercises with the United States. These have included PSI-style counter-proliferation and counter-terrorist training. However, India may be wary of becoming a PSI participant because it might then come under pressure to take action against Iran, which New Delhi regards as a key energy supplier for the future.

Additional authority

Despite these weaknesses, the PSI has received some significant new legal underpinning since it was formed in May 2003. The operation gained additional authority in April 2004, two months after the Khan nuclear smuggling network was exposed, when the UN Security Council unanimously passed Resolution 1540 to prevent the spread to non-state actors, including terrorists and black marketeers, of WMD weapons and their means of delivery.

Meanwhile, Washington has been negotiating bilateral deals with major flag states--the governments that make a business out of renting their national flags to ships so that they can legally operate on the world's oceans. Under the agreements, if a vessel registered in the United States or the partner country is suspected of carrying proliferation-related cargo, either one of the parties can request the other to confirm the nationality of the ship in question and, if needed, authorise the boarding, search and possible detention of the vessel and its cargo.

Since early 2004, the United States has negotiated bilateral board agreements with seven significant flag states--Liberia, Panama, the Marshall Islands, Belize, Croatia, Cyprus and Mongolia. Panama and Liberia are, respectively, the world's largest and second largest ship registries; Cyprus is sixth and the Marshall Islands seventh. Although a land-locked state in North-east Asia, Mongolia is notable because it has a moneymaking international ship register that was used by North Korea to disguise the national identity of some of its cargo vessels. The combination of the seven flag states, plus ships registered in other PSI partner countries, mean that over 60 per cent of the global commercial shipping fleet, measured in deadweight tonnage, is liable to rapid action consent procedures for boarding, search and seizure by the United States or a PSI member.

Boarding right

America can now request from these seven flag states the right to board a suspect ship on their registers anywhere in international waters--and do so after waiting no more than four hours for a response from the flag state. In other words, no reply by then is to be taken as approval for boarding. Of course, merchant ships flying the flags of either North Korea or Iran are not liable to such searches; nor are naval vessels of these countries.

However, in evaluating the PSI, it is important to note that it is not a standalone weapon. The PSI is just one part of a counter-proliferation armoury with a wide array of diplomatic, intelligence, financial, law enforcement and military instruments. It is buttressed by national export controls on strategically sensitive items, by multilateral export control regimes such as the 45-nation Nuclear Suppliers Group, and by international security checks that have gained the support of many key countries. These checks include the Container Security Initiative and the MegaPorts Initiative--both introduced by the United States after 9/11 to prevent terrorists from planting WMD in cargo containers and major shipping ports to hit America and disrupt world trade. The PSI is reinforced by the work of the International Atomic Energy Agency and its inspectors, and by national and international laws to stop the financing of terrorism and the WMD trade. Together, these and other counter-proliferation mechanisms form a layered defence system.

How successful has the PSI been in disrupting the spread of WMD-related material by making it increasingly difficult and costly for proliferators to ply their trade? It is, of course, impossible to measure the deterrent effect of the PSI. What about its practical effect?

The United States and its allies say that there have been a substantial number of PSI successes and that they have disrupted efforts to smuggle WMD and related missile components in various countries. Western officials decline to reveal details, saying that they want to protect intelligence sources and partner nations.

Port operation

However, one well-publicised PSI operation in a seaport was in Taiwan in August 2003. At the request of the United States, Taiwanese officials in Kaohsiung prevented a cargo ship registered in North Korea from leaving port until the captain agreed to leave behind over 150 barrels of phosphorus pentasulfide, which American officials said could be converted into chemical weapons in North Korea. Phosphorus pentasulfide is one of many dual-use chemicals. It can be used to manufacture insecticide and as an additive in motor oil. But it can also be used to make nerve gas.

Another well-publicised PSI maritime operation involved the co-operation of four members--Britain, Germany, Italy and the United States--to stop a shipment of uranium enrichment components from reaching Libya. British and US intelligence officials found out that thousands of parts for centrifuges, which can be used to enrich uranium for nuclear weapons, were being shipped in October 2003 in five containers on a German-owned and flagged freighter, the BBC China, from the Persian Gulf port of Dubai, through the Suez Canal, to Libya. The parts had been manufactured in Malaysia. The German owners ordered the ship's captain to divert to the Italian port of Taranto where the vessel was searched and the WMD-related cargo seized.

Significant role

This interdiction certainly played a significant role in the unraveling of Khan's nuclear black market network, which stretched from Europe to Africa and across the Middle East to Asia. The seizure probably helped to convince Libya to give up its WMD and longer-range missile development when it became dear that the United States, Britain and their allies knew a great deal about the extent of the previously secret programmes. Two months later, in December 2003, Libya formally and publicly renounced weapons of mass destruction and their delivery systems.

Still, officials who searched the BBC China in Taranto in October and confiscated the Malaysian-made centrifuge parts failed to find a container with components for enriching uranium that came from a different source, Turkey, which unlike Malaysia is a PSI member. The BBC China eventually, in March 2004, delivered the container to the port of Tripoli, where it was handed over by Libya and shipped out of the country.

This failure to detect the additional shipment from Turkey is an illustration of how difficult it is to track all movements of WMD-related items in a globalised economy. However, it also underscores the need for an effective PSI safety net.

Since 2003 the Proliferation Security Initiative has been an important element in the battle against the spread of weapons of mass destruction. The United States, Japan and Australia were prominent in its development, and they have now been joined by more than 80 other states, including New Zealand. The dangers of weapons of mass destruction falling into the hands of terrorists was a key motivator, as was recognition that existing arms control treaties and arrangements contained loopholes that could be exploited by non-state actors or terrorists. A major focus has been the interception of shipments of weapons or components by sea, but the PSI also aims to prevent their movement by land or air.

Michael Richardson is a visiting senior research fellow in the Institute of South East Asian Studies, Singapore. This article is the edited text of an address he gave to the NZIIA's Wellington branch on 20 November 2007.