- The Washington Times - Friday, May 10, 2002

The State Department yesterday announced it is imposing economic sanctions on Chinese, Armenian and Moldovan companies for selling weapons-related goods to Iran.

"We will be imposing some penalties on Armenian, Chinese and Moldovan entities pursuant to the Iran Nonproliferation Act of 2000," State Department spokesman Richard Boucher told reporters.

A senior administration official said the sanctions are related to transfers of chemical weapons technology.

"China has a mixed record on proliferation," the senior official said, speaking on the condition of anonymity. The official said some of the same companies that were sanctioned in the latest penalties have been sanctioned by the U.S. government in the past for arms-proliferation activities.

The names of the 14 targeted companies were not disclosed, and the penalties, which limit U.S. government contacts with the firms, will last for two years, the official said.

The action was carried out based on intelligence reports indicating the companies had transferred military equipment to Iran in violation of U.S. law.

It was the third time in the past eight months that economic sanctions were imposed on Chinese companies, most of which are state-run enterprises. It will be the first time Moldovan and Armenian companies have been hit with sanctions.

In January, the administration slapped sanctions on two companies and one person for their role in selling chemical and biological weapons-related equipment to Iran.

Sanctions also were imposed in September on the China Metallurgical Equipment Corp. and Pakistan's National Development Complex for their involvement in selling Chinese missile equipment for Pakistan's Shaheen 1 and Shaheen 2 missiles.

Those transfers also violated a Chinese government pledge to the United States in November 2000 not to export any missile-related goods for nuclear weapons delivery systems.

U.S. intelligence officials said the latest sanctions have been imposed because of China's transfer of naval missiles to Iran in January.

The sanctions are required under the provisions of the 2000 Iran Nonproliferation Act. The act requires sanctions on companies that sell Iran items controlled under the provisions of the Nuclear Suppliers Group, Missile Technology Control Regime, the Australia Group, the Chemical Weapons Convention, or the Wassenaar Arrangement.

Those agreements are aimed at limiting the spread of nuclear, chemical and biological weapons and missile delivery systems.

The companies will be identified in a notice in the Federal Register, the government's formal notification publication, in the next several days, Mr. Boucher said.

Mr. Boucher said the sanctions prevent the U.S. government from doing business with the Chinese, Armenian or Moldovan companies involved in the transfers.

Mr. Boucher said he appreciated the help of the governments of Moldova and Armenia in resolving the Iranian weapons transfers, and declined to comment when asked if the Chinese government was helpful.

In Beijing, a Chinese Foreign Ministry spokesman said the imposition of sanctions is unfair.

"We oppose the unreasonable sanctions by the United States, if the news is for real," Foreign Ministry spokesman Kong Quan told reporters before Mr. Boucher's announcement.

"China has consistently and firmly opposed any weapons of mass destruction," Mr. Kong said. "The Chinese government has strictly fulfilled its international obligations and made a series of relevant laws and regulations, and imposed strict control on the export of relevant items."

President Bush visited China earlier this year and unsuccessfully tried to win China's approval of a new system aimed at halting the export of weapons of mass destruction.

Defense Secretary Donald H. Rumsfeld also raised China's proliferation of weapons of mass destruction to terrorist states during a meeting last week with Chinese Vice President Hu Jintao, defense officials said.

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