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Czech Arms for Al Qaeda
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By Jaroslav Spurny. Translated by Eva Pilatova.

posted on TOL Wire on 25 July 2003

from Respekt http://www.respekt.cz/

By the end of today, the globe will have been criss-crossed by convoys carrying arms worth $700 million. The same was true yesterday and will be tomorrow. Every year, weapons worth $200 billion are sold worldwide. A small stream of money from these convoys also flows into the Czech Republic. The problem is that the hands receiving this local ‘special material’, as arms are known, are often very dirty. No border patrol pays special attention to this lucrative trade in death.

TANKS FOR THE MULLAHS

It’s a cold and damp noon in Tbilisi on the last day of February. Stallholders selling cigarettes and alcohol are warming their hands over open fires opposite the flaking walls of the Georgian Defense Ministry. An old Zhiguli car or a dented van pass now and then along a broad, potholed road. We are going to a meeting with Gela Bezhuashvili, a deputy to the Georgian defense minister. The man at reception seems, though, to have different information: Our meeting has been canceled without any reason being given. Several hours later we get an unofficial explanation from the Czech ambassador, Jiri Nekvasil: “You shouldn’t be surprised. You're spreading untruths about Czech arms imports to this country.”

Nekvasil is referring to a case in 2000 when Respekt, drawing on documents it had obtained, reported that the Czech Republic had sold 120 T-55 army tanks to Georgia over the previous two years. The sale was approved at the time at a special session of the state security commission, but the ministry in Tbilisi and officials at the Czech industry ministry today claim that only 12 armored vehicles arrived in Georgia. Apparently the country lost interest in the other tanks.

“I saw those 12 tanks with my own eyes. There weren’t any more,” says Nekvasil.

But it’s not quite as simple as all that.

In 2001, after the attack on New York’s twin towers, a French expert on terrorism, Roland Jacquard, published a book titled In the Name of Usama bin Laden. In the book, he says--citing sources in the Italian secret services--that more than 100 tanks went from the Czech Republic via Georgia to either Al Qaeda or to the Taliban in Afghanistan. Even though Czech exporters of arms and officers ridiculed Jacquard’s assertion (“It’s nonsense,” said Ales Vermirovsky, head of the workshop that repairs and maintains tanks), it’s not unlikely.

In 2000, for instance, the Czech authorities gave a license to sell 100 tanks to Yemen to a firm whose identity remains secret (as too is the shipping route and shipper). This was just after the CIA discovered and released the alarming information that Yemen was smuggling tanks bought from Polish arms traders to Sudan, a country under an international embargo and riven by religious and ethnic conflicts, government repression, terror, and a war that has brought death to tens of thousands of civilians. The deal between the still-mysterious firm and the Yemeni government was struck after Al Qaeda carried out a terrorist attack on an American warship in Yemen in which 17 U.S. Marines died.

And we keep supplying tanks to Yemen. “I really do not know whether the tanks are re-exported. That would stir up a hornets' nest,” said Petr Necas, the longtime head of the parliamentary committee for defense and security.

“As far as I know there are guarantees from the Yemeni government that the tanks will remain in the country. I’ll check that,” says Industry Minister Milan Urban, whose office grants licenses for such exports.

But to return to Georgia: Even though the deal with "special material" is strictly concealed in the Czech Republic and the list of approved dealers is also confidential, Respekt has in its possession a document permitting a company called Thomas CZ to export 120 T-55 tanks to Georgia in 1999. It was an extraordinary thing for a small Caucasian republic: It owned just 20 of them at that time.

Moreover, the sum the local army was to pay--just over 100 million crowns [$3.6 million at today’s rate]--was more than its entire budget for military hardware. Put simply, that year the army would not have been able to buy a single round for a submachine gun.

THE DISBELIEVING AMBASSADOR

Tracking down imported weapons in Georgia is an experience. Even before passing through passport control at the airport, a man in a leather jacket approaches us. “Are you Czech journalists? I’ll help you with the formalities,” he says without revealing his identity. “That is not important. You can call me Yuri. I’m just supposed to help you,” he adds.

And the entry and customs formalities really are dealt with immediately. We skip the queue in front of passport control and the mysterious man hands us over to a taxi driver. From that moment on until the end of our 10-day stay, we cannot rid ourselves of the unpleasant suspicion that we are being controlled by the local secret services. They know all about us at the Foreign Ministry, which issues the necessary accreditation for $15. They even know that we came to search for exported tanks and other Czech hardware. As it emerges later, the Georgian authorities received their information from the Czech Embassy in Tbilisi.

Ambassador Nekvasil refuses to cooperate with us in any way, even refusing to pass on the names of contacts. Why? Could the explanation be the ambassador’s good relations with arms exporters, a relationship that the owner of Thomas CZ Jiri Tomes likes to boast of?

“I know Mr. Tomes, but that has nothing to do with it. I simply think that you are not capable of providing objective information.”

Fortunately, BBC correspondent Ketevan Bochorishvili is in Tbilisi and she can help us get to some local sources of information. “The man with the best information is a member of the parliamentary security committee, Giorgie Baramidze,” Ketevan says. It is late afternoon and as we near the parliament building we see it is dark; at the moment there is no electricity supply in the center of Tbilisi, daily outages are common. Sometimes the darkness can last hours. We pass a double military check. Men in uniforms and with automatic rifles in their hands also stand in the courtyard of parliament and in its corridors. The meeting is, however, all for nothing, as Baramidze does not want to deal with foreigners at all.

“A tank deal? I know nothing about that,” he says. “But Georgia needs weapons, we need to defend ourselves. The situation in our country is not fully under the government’s control. Russians have their interests and troops here and are trying to limit our sovereignty. And we share a border with Chechnya,” the parliamentarian adds.

Another meeting--with an editor of Radio Free Europe--takes place in circumstances that are almost conspiratorial. A guide recommended by the RFE journalist picks us up in our hotel and without a word drives us in a dirty Zhiguli far out to the outskirts of the city. There we pass through a corridor in a prefabricated apartment block and get into another car that has been waiting for us. The guide, again without a word, drives to another housing estate, where we end up in a flat that is freezing and dark (the majority of Tbilisi housing estates have no heating and no water supply and spend almost the entire day without power).

Outside the window in the dark, some 100 kilometers away, is the Pankisi Gorge, where the Georgian army is, with American assistance, currently struggling in vain to capture a hundred or so Al Qaeda terrorists [reportedly] hiding there. Unfortunately, even this meeting produces no new information.

In the end we managed to glean some details from a Georgian journalist, Irakli Aladashvili. According to the information he has, Georgia had one fundamental condition: The deal should remain secret. “Why? I don’t know,” says Aladashvili. “Re-export is naturally one of possible explanations. But it is more likely that the government is trying to conceal armament purchases from Russia, which is still threatening our sovereignty.”

However, after Respekt released its article [in 2000] and after In the Name of Usama bin Laden was published, the contract began to be discussed in the Czech press and the deal became public. Aladashvili believes that could have alarmed the politicians and businessmen involved so much that the deal was dropped.

“You know, the fact that I have business with Georgians annoys Russians. And their secret services are spreading various lies about me, for instance that rubbish about re-exporting the tanks to terrorists or to dangerous countries,” explains the owner of Thomas CZ, Jiri Tomes. “But I can tell you one thing: I haven’t shipped 120 tanks there.”

Is he telling the truth? Did we send to Georgia tanks for Al Qaeda or the Taliban, as Jacquard maintains? Only those in the know can give an answer, and they are keeping mum or are hard to believe.

“Information on exports is classified,” cabinet spokeswoman Anna Starkova declares flatly.

The case of the Georgian tanks demonstrates that when the press and public take an interest in a shady business deal, it is much more difficult to conclude it. That is the main argument why arms trading should become far more transparent and why the state should not keep them under such close wraps.

INTO THE UNKNOWN

The International Institute for Peace Research in Stockholm calculated that in 2002, the world spent $800 billion on military expenses, a quarter of that on weapons. According to a report by the U.S. Congress issued in August 2002, by far the biggest importer of arms over the past seven years has been Saudi Arabia. Over that period, it invested $70 billion on arms (by way of comparison, South Korea imported $10 billion over the same period, Israel $8 billion, and the Czech Republic less than $100 million).

The largest arms exporter last year was Russia. The country exported weapons worth $6 billion. According to data from the Czech Ministry of Industry, the turnover of domestic arms was $9 billion crowns [$322 million]. That ranks us among the top 40 arms exporters and, compared to the overall volume of domestic exports (200 billion crowns, or $7.2 billion), that may seem a negligible number. The problem with Czech arms exporters, however, is something else.

According to the Ministry of Industry, more than 100 firms have licenses to trade weapons, and two-thirds of them do in fact deal in arms. Ninety percent of them either belonged to the communist-era empire Omnipol or employ Omnipol people in some capacity. Jiri Tomes of Thomas CZ used to be a manager in Tatra Koprivnice before 1989's Velvet Revolution, selling trucks to the armies of our Bolshevik allies. Now the stage set has changed but businessmen are following the same track: They are trying hard to hang onto the markets they know so well from the communist era. Communist Czechoslovakia used to export weapons chiefly to countries that are today rated as countries in crisis, where human rights are being seriously breached.

“The structure of Czech export is largely based on the sale of unwanted older-generation weapons from army or police stocks," says Filip Pospisil of the foundation Clovek v tisni [People in Need], which analyzes arms exports. "These guns are cheap, they are unsuitable for modern warfare. They don’t have the deterrent effect on the importers’ external enemies, but they are still effective in internal conflicts, in civil wars. Moreover, there is information emerging in the world media that Czech weapons are often re-exported even to embargoed countries.”

A year ago, the British newspaper The Guardian quoted three Iraqi army defectors as saying, “We witnessed the delivery of 15 missiles and homing devices to Iraq. The shipment was unloaded in the Syrian port of Lakatia. We know that the weapons were originally exported from the Czech Republic.”

When the Guardian article came out, Anna Starkova of the Ministry of Industry had this to say: “I’m 100 percent certain that we didn’t issue a single license to export missiles to Iraq last year.”

And what about Syria? Could the ministry have issued a license to sell missiles to Syria? “I can’t tell you that. That’s secret,” she said.

After winning the war, Americans did find in Iraq an arsenal of dozens of air-raid missiles of the Strela 2 type supposedly traded in the deal. Nevertheless, it has not yet been disclosed whether the U.S. army or the CIA has ascertained that the missiles actually were re-exported from the Czech Republic.

Another example: Two years ago, a scandal about the export of artillery to Georgia erupted in the Czech Republic. The deal was done by good old Thomas CZ (which, by the way, won its license despite having, in early 2001, brokered the purchase of defective, and therefore useless, munitions for armored vehicles for the Czech army; the loss to the treasury was 30 million crowns). Tomes’ people chartered a plane from the Ukrainian company Volare to transport the weapons. However, one of the FBI's European bureaus discreetly warned allies that something odd was happening and the plane was checked during its layover in Burgas, Bulgaria.

It was found that the crew wrote over the journey’s destination in a flight plan from Georgian Aspara to Asmara, a capital of Eritrea, a country in the throes of civil war and under an arms embargo. An “intensive investigation” began, during which the Ukrainian crew disappeared no one knows where without having been questioned. A month later, both the Bulgarian and Czech authorities announced that “the law was not breached.” The plane then flew on to Georgia with a different pilot.

Did the arms end their journey there? That’s unknown. “When I tried to find out,” says Irakli Aladashvili, “I hit a wall of silence in our government offices.”

THE TRACK LEADS TO GIBRALTAR

The late head of the National Auditing Office, Lubomir Volenik, once said in an interview with Respekt that “the biggest corruption worldwide is to be found in state tenders; that is, in the building industry and the arms trade.”

A stereotypical example of this is the notorious attempt by the Czech government, led by former Prime Minister [Milos] Zeman, to buy Gripen fighters from the Swedish-British firm British Aerospace for 100 billion crowns ($3.6 billion). From the start, even the birds in the trees have talked about corruption in this colossal deal, which all major representatives of our NATO allies tried to talk the Czech army and government out of, arguing that it was pointless. In the corridors of power, it is even possible to hear the exact figures being quoted: British Aerospace was supposed to invest into lobbying efforts--and probably corruption (Omnipol represented the interests of the importer in the Czech Republic)--about 700 million crowns [$25.1 million]. Some politicians say strangers were offering them bribes worth millions (for instance, 60 million crowns [$2.1 million] to Senator [Michal] Zantovsky) for help in pushing through the deal. The police, though, have not uncovered anyone involved in corruption.

In the end, the purchase of the Gripen fighters failed to pass through parliament by a single vote and the deal was then shredded by the new government, led by Prime Minister [Vladimir] Spidla. According to information that was gleaned by Respekt from the secret services but that is hard to verify, the sellers were unhappy at the collapse of the deal and demanded compensation for the money they had invested. They were supposed to receive it from the Czech state in a very complicated operation that indicates just how difficult it is for outsiders to find a firm footing in the arms-trade merry-go-round.

The secret service source claims the following: British Aerospace could get the money that it had allegedly invested in vain back indirectly, by means of the Czech army placing an order for Spike missiles from an Israeli company, Rafael. In very simplified terms, the Israeli firm offered missiles for $200,000 each and the army planned to buy 500 hundred of them. That at least was the arrangement before Defense Minister [Jaroslav] Tvrdik resigned [in May 2003]. His successor, [Miroslav] Kostelka, currently does not want to confirm any purchases because of budget cuts.

Spike is a universal missile that can be used manually, attached to a helicopter, or installed in an armored vehicle. Similar and equally efficient missiles are, however, available from other manufacturers at prices that are cheaper by a quarter. The Finnish army bought Spike missiles from Rafael last year and the price was 25 percent less than the Czech Republic is supposedly due to pay.

According to information from the secret services, a company in Gibraltar owned by a former senior government official in Prague (Respekt knows the names but will not release them until the details of the entire operation are fully checked) is to play a role in the alleged overpriced purchase. A Czech-English partner of this official has another firm in London that works for British Aerospace. And it is in the account of this firm in London that the $25 million "overpayment" for Israeli missiles should end up, or so the secret service agents claim.

“That’s complete nonsense,” comments former Defense Minister Tvrdik. Shadow Defense Minister Petr Necas also has no inkling. According to some sources from the intelligence service (BIS), this could be a game being played by the intelligence services, which, for unknown reasons, want to compromise the management of the Defense Ministry and some politicians.

WARNING! PRIVATE BUSINESS

The problem with these deals in Czech arms is the lack of transparency in shipping, the secrecy of financial transactions, and the lack of checks on the buyers. In the United States, Germany, Britain, France, Denmark, and the majority of countries in the European Union, the state has primary responsibility for controlling the export of arms or purchases for their own armed forces. Moreover, these countries publish annual reports informing the public about the overall trade in weapons.

In contrast, since 1994 the Czech Republic has had a law that prohibits the state from exporting arms or purchasing them abroad for its own army. Lawmakers gave this right solely to private companies, which then receive a 10 percent commission from the army. And so last year’s arms trade, worth 9 billion crowns, will have put almost 1 billion crowns [$35.8 million] into the pockets of the middlemen clustered around Tomes and Omnipol.

The law making the involvement of private firms compulsory was pushed through parliament by Miroslav Kalousek, then deputy defense minister. His reasons seemed logical. “The objective here is to prevent corruption among state officials. We are not able to give them salaries that would free them from the temptation of corruption, while private firms operating in a competitive environment would be primarily concerned with their good reputation,” he explained back then. Members of parliament accepted the argument. All trades are now “confidential.” The public only hears the overall figures for exports and imports.

“That law is not a good one and I will push for an amendment,” said newly appointed Defense Minister Jaroslav Tvrdik two years ago to Respekt. Nevertheless, by the time he resigned he had yet to propose any amendment to the cabinet.

“I’m considering whether our [party] should do something about the law,” Petr Necas, a deputy chairman of the Civil Democrats (ODS) and currently the shadow defense minister, said at the very same time. He, too, has done nothing.

“It’s impossible. That regulation cannot be changed at the initiative of a member of parliament,” Necas explains, “but only after a government resolution, then approved by parliament.”

And why did Tvrdik--according to many soldiers as well as civilians the best defense minister in the history of the Czech Republic--not push the law through? “We were preparing a reform of the army, working on NATO’s requirements, and I also introduced a lot of measures tightening the purchase and sale of army assets,” the former minister explained to Respekt. “There was simply no time left for that law.”

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