ARGENTINA: CONDOR MISSILE PROGRAM AT A CRITICAL JUNCTURE

Created: 8/1/1990

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DATE: FF.B

.DIRECTORATE OF INTELLIGENCE

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Argentina: Condor Missile Programritical Juncture

Summary

Argentina's controversial Condor ballistic missileajor irritant in US-Argentine relatlons--is at an important juncture inyear history. Despite considerable pressure from Argentine nationalists to continue with the Condor II missile's development, the Menem government apparently haa decided to Initiate steps to abandon the troubled program to enhance its international image and toloser relationship with the United States. Henem's success to date in improving civil-military relations should help him and bis defense advisers weather what will probably be atiff resistance from those in tho military opposed to cancelling the Condor program. Given Iraq's renewed interoat in Argent ins's assistance in completing the development of the missile, some Air Force personnel and firms Involved in the program may attempt either to move their operations to the Middle East to market their experience and know-how or to operate clandestinely in Argentina in hopes of selling missile technology to Middle Eastern clients.

This typescript was prepared bvSouth America-

Caribbean Division. Office of African and LatinontributionOffice of

Scientific and Weapons Research. Comments and queriesand may be directed to the Chief, South ALA,

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CL BY: DECLi OADR DERV: MULTIPLE

Menem Is likely to have high expectation*S-Argent ine cooperation -agreement In the aerospace field to compensate for the loam of Condor research and development. We believe his resolve in clamping down on potential rogue Condor operations will be dependent,arge extent, on the degree to which he believes Washington is providing opportunities for the Argentine aerospace industry to engage in Joint space and aircraft development and is supporting his broader economic reform efforts.

Background

he Argentine Air Force embarked on anmissile development program--code named projectprovide itignificant strike capability,advances in weapons and space development,international prestige, and generate exportprogram encompassed the development of three missile1 Alacran (designed to be both an operational

nissileestbed for the rocket motor and aerodynamicsIntegrity of follow-onhe

tcand amissile. Research_and

centered 1

development has been centered largely on the Condor II

Condor II missilewo-stage vorsionondor I

ET

Current Dovlopmont Status

Over the past two years, however, progress on the Condor II has been stymied by technical difficulties, funding shortfalls, and international scrutiny, bringing the programirtual standstill '

.International scrutiny of the Conaen consortium--prompted by the formation of the Missile Technology Control Regime (MTCR) in Aprilwell as KTCR restrictions on the transfer of advanced technology have also disrupted development of the missile.*

Iraq, meanwhile, has made indigenous missileigh priority and apparently has renewed Its intaraat in Argentina's program.

We believe that, using

couiand begin series production by the

an elaborate technology and materials procurement network

Jlrag could manufacture Condor.

.

Production of the missiles, however, might ba delayed until tnef the flow of technology andin the area of guidance andinterrupted.

The Menem Adminlatratlon'a Policy on Condor

Argentine President Menem, along with Defense Minister Romero and Foreign Affairs Minister Cavallo, recognize that addressing US concerns about missile proliferation will be an important factor in their ability to improve relations with Washington and obtain support for theconomic

reform program. For their part, the chiefs of the

that, in light of the country's bleak financial situation, defense and missile policy should parallel Menem's pragmatic orientation towards the Weet to secure military assistance and orders for Argentine military technology^

esult, Menem end his top advisers apparentlyto take steps to abandon the development offII. Romero and Ca+allo

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expect Menom toecree endinghe Condor program, which would be the clearest statement to date of the administration's intention to abandon the missile. Meanwhile, the government hasS technicalscheduled to visit Argentina in late July to confirm that Condor operations have been shutpostpone its visit until after the decree is issued to allow time to work out legal arrangements for the cancellation of contracts with the Consen Croup.

Menem reportedly will play up tho decree as ato head off allegations from nationalists thatls bowing to US pressure ond sellingesearch and development, but cancelling the Condorstill encounter stiff resistance. The missile has beenof national pride and many private firms havein the program. Monem has faced strong pressurenationalists, including Peronist Partysome members of the opposition Radical Party, tothe Condor II'b development, as well as from congressmenprivate sector interests involved in the Romero has acknowledged to US officials that hehave been asked to appear before ato discuss the Condor program and thepolicy toward it.

Strong opposition to cancellation willalso come from within thethe Air Force. I

Air Force officers with personal stakes in the

evelopment have used political contacts to try toadministration toward continuation of the program. support from Romero and the service chiefs other high-level military

argued that

must preserve its research and development in ballistic missile technologies for strategic reaeonsP

Prospects for Condor .ir.fl Ircplns for the United States

Buoyed by successes In economic reform and the privatization of state-owned enterprises. Menem currently appears to betronger position politically to resolve the Condor lasue than he

ear ago. Improved civiL-military relations should help him and his defense advisers weather the potential fallout from those in the military opposed to cancellation. Moreover, negotiationsS firm for co-production ofampa trainer aircraft have improved prospects that the Air Force, which stands to gain financially from Pampa sales, will be amenable to abandoning Condorf

It is possible, although we believe doubtful, thatpparent readiness to cancel Condor is designed for US consumption and to mask his intention merely to go through the motions of ending it or even of allowing it to continue covertly. In our view, however, Menem realizes that discovery of either course by the United States would seriously damage bllatr ii relations.

A more likely scenario is that, in the event of cancellation, retired and active duty Argentine Air Force officials who run the condor program and are accustomed to operating independently win try to keep the project alive clandestinely. Givenenewed interoet in Argentina's assistance, these officials and related firms may try to move their operations, experience, and technical know-how to Iraq.

Should Menem follow through with cancelling Condor, we believe he will have high axpectatlonailateral agreement--probably with regard to apacewould help compensate Argentina's aeroapace industry for the loss of the program, when President Bush visits .in September. Workingormula for US aaslstance probably will be on Romero'a agonda when he visits Washington this month. Moreover, Nenem's resolve in reining in potential rogue Condor operations is likely to be dependant, arge extent, on the dogree to which he believes the US Is helping him engage his aeroapace industry in peaceful ventures, such aa aircraft and space development, and providing support for his economic reform program, including assistance on the debt and trade fronts. At the same time, Menem will look to Washington for help in downplaying any US connection to tha cancellation of the Condor to prevent Inflaming nationalistic sentiment.

Original document.

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