Volume 1 - Iraq Watch

• The technology included guidance components forsurface-to-air missiles, assistance in the developmentof batteries for the latest antiaircraft missiles,providing equipment for missile research and possiblyassisting in the establishment of a college fortraining of missile expertise.• Cooperation was initiated by Iraq requesting quoteson a test stand for rocket motors, a series of gyroscopesand accelerometers for missile-guidancesystems and high precision machine tools for manufacturingmissile components.In 2000, Ukraine-Iraq relationship became publicknowledgewhen the Ukrainian Government wasimplicated in selling Iraq a Kolchuga antiaircraftradar system. President Leonid Kuchma was accusedof personally approving the Kolchuga sale, worth$100 million, via a Jordanian intermediary.• Evidence of Ukrainian Government complicity inthe sale to Iraq was based on a secret 90-secondaudio recording made 10 July 2000 by MykolaMelnychenko, a former counter-surveillance expertin a department of the Ukrainian Security Service(SBU), according to press reports. The recordedconversation involved President Kuchma, ValeryMalev, the head of Ukspectsexport, a state exportagency, and Leonid Derkach, the former SBUChairman. Kuchma allegedly authorized Derkach toexport 4 Kolchuga radar systems to Iraq via Jordan.Kuchma also gave Malev permission to bypassexport controls for the deal.• Initially, Ukrainian Government denied the allegationsbut then changed its position on the issueseveral times. First, it denied that the meeting hadever taken place. Later it admitted that the meetinghad taken place and that President Kuchma hadauthorized the sale, but argued that the sale had notbeen completed. (No Kolchugas have been found inIraq.)• It is interesting to note that the Government ofUkraine lifted export restrictions on Kolchugaradars four days after Kuchma authorized the saleto Iraq. After this deal, Ukraine and Iraq signed atrade and technical cooperation agreement in October2000. Ukraine parliament ratified the agreementin November 2001.The Iraqi IIS, MIC, and the associated MIC frontcompanies also acquired military-related goods fromUkraine. According to information obtained in aninterview with the former MIC Director ‘Abd al-Tawab Mullah Huwaysh:• In 2001, the IIS purchased five motors forunmanned aerial vehicles (UAVs) from the Ukrainiancompany Orliss for the MIC and Ibn Fernas.The Orliss company representative was by a femalephysician named Olga Vladimirovna. The motorswere allegedly transported from Ukraine to Iraqivia Iraqi diplomatic pouch.• In another instance an “Olga” (most likely Ms.Vladimirovna from Orliss) was known to haveassisted the MIC with a carbon fiber filament windingand insulating material project. She was also thepoint of contact, in late 2002, for a contract with anunspecified Ukrainian supplier for missile enginesand gyroscopes, but none of these items were everdelivered. The MIC only received some models ofthe gyroscopes.Figures 55 and 56 further illustrate the activitybetween the MIC, and the MIC front companies suchas ARMOS, and Ukrainian military supply companiesin 2002.In addition to gyroscopes and motors, Iraq soughtmissile fuel from private Ukrainian companies.Huwaysh stated that Iraq approached Ukraine fordiethylene triamine (DETA) and AZ-11 (a mixtureof 89 percent DETA and 11 percent UDMH). TheMIC intended to use the fuel for the HY-2 missilesystem. Iraq reportedly had approximately 40 HY-2missiles but only had sufficient fuel for 15 of them.Iraq, however, never received either the AZ-11 or itscomponents.By 2003, recovered documents and intelligenceindicate that the ARMOS Trading Company was playinga greater role an intermediary between Iraq andUkraine. ARMOS was a joint venture with a Russiancompany established by MIC to import technologyand assist in the acquisition of materials and equipmentfor MIC and other Iraqi ministries.Regime Financeand Procurement97