Canada's CANDU Sale to Romania

The Socialist Republic of Romania, because of its "maverick" foreign politics, has become a favorite son to Western governments and some peace activists. Yet Canada's sale of CANDUs to Romania aids the military intentions of Europe's most cruel dictatorship and harms Canada's working class.

By Wally Keeler

Whatever Became of Massey-Ferguson?

The first CANDU reactor was contracted in 1978, the second in 1981. Romanian authorities plan to build fourteen more reactors on their own under a licensing agreement with Atomic Energy Canada Ltd. (AECL). As early as 1980, Canadian federal authorities knew that Romania was having difficulty repaying debts. Nevertheless, Romania exploited the Canadian nukeniks who were eager to save their industry at all costs.

Counter-trade was accepted as the method of repayment. Canadian firms making CANDU components must accept Romanian products as payment, which then must be resold. Romania offered to trade furniture, clothes, food, heavy machinery, and farm equipment.

A Toronto Star article rightly reported in 1980 that "Federal trade officials are worried that the cheap imports could drive many Canadian firms out of business. Some Canadian companies, such as farm machinery manufacturer Massey-Ferguson Ltd., already are suffering layoffs because of slumping domestic and international sales."

Energy Probe researcher, Norman Rubin, charged, "By being willing to take trade or barter, we are willing to deal away what is surely a larger number of jobs in other Canadian industries. There is just about no domestic industry in which $1 billion worth of goods carries as little employment as building CANDU reactors. But if we import $1 billion worth of inexpensive tractors, we can virtually wipe out Massey-Ferguson."

Look around. Where is Massey-Ferguson now? In 1985, 16,000 tons of bulk steel arrived in Canada from Romania. Stelco. Dofasco, and Algoma protested to the federal government, "These shipments took several weeks of production away from Stelco in an already weak market area," said a Stelco spokesman. Algoma and Dofasco officials echoed the sentiment.

Transferring Technology

During the initial negotiating stages of this deal, Romania enticed AECL by expressing a desire to purchase up to 20 reactors. It later cut the deal down to four reactors, with the option to build more by itself under a licensing agreement with AECL. After this, the four reactors became two, with the proviso of at least 60 percent Canadian content. Eventually, the Romanians managed to negotiate the 100 percent surrender of the design specifications.

Researcher Thad McIlroy wrote, "Romania is buying not even one complete reactor from Canada. They have all the plans for the nuclear portion of the CANDU 600 and are working very hard to build much of it themselves. The license fee per reactor is under $10 million for a product that Canada sells for about $900 million, and which cost this country billions of dollars to develop. Furthermore, Romania has given every indication that it plans to sell Canadian reactors to third markets." (On CBC's Sunday Morning radio program, Romania's ambassador, Emilian Rodean, flatly stated that it was Romania's intention to sell CANDUs to other nations.) The contract with AECL provides that future reactors can be built only in Romania.

Romania has a long history of trading without regard to morality; its economic partners include dictatorships of all political stripes, including the Shah of Iran, Saddam Hussain of Syria, and Kaddafi of Libya - all oil suppliers.

Romania signed the CANDU contract's nonproliferation clauses - but its signature may be as worthless as the one it affixed to the strengthened Helsinki Accords in Vienna last January. (It promptly and publicly disavowed obedience to those clauses.)

Romania has a policy of forced cultural assimilation for the 2.5 million Hungarians in Transylvania. Hungary's protests against the persecution escalated to tit-for-tat expulsion of diplomatic staff. Last autumn, Romania held sabre-rattling military manoeuvres along the Hungarian border.

Weapons Potential?

Hungary's Foreign Minister, Matyas Szuros, on a radio program, described a meeting between the leaders of Hungary and Romania in August, 1988. Ceausescu had boasted that "Romania already has such a strong industry that it is able to make any kind of weapon." The esteemed Hungarian journalist, Istvan Csurka, who understands this oblique message, advised the Hungarian people that they were being threatened by the "atombomba."1

To finance all this, Canada's Export Development Corporation (EDC) provided $1 billion - the largest deal in its history. On March 10, 1982 the financing was suspended because Romania was broke. Later that year, Romania announced the purchase of three Soviet reactors. Such open-wallet attitudes has raised questions about Romania's spending habits. Thad McIlroy, in a report to the Hungarian Human Rights Foundation exposed irregularities and misappropriation of funds by Romania. This was obliquely confirmed by federal officials; McIlroy quoted Robert MacKenzie, who has responsibility for this project at External Affairs, as calling the loan 'sweetener financing' to lock up the deal with the Romanians."

Likewise, Beppie Crosariol reported a study concluding that "no CANDU export has ever resulted in a financial gain for the company. He estimated that AECL has cost the federal taxpayer a total of $12 billion (measured in 1981 currency) since its inception."2

Spies and Heavy Water

The Romanian rip-off was further confirmed in a 1987 book by Ion Mihai Pacepa, the former head of Romania's infamous foreign spy service, the CIE, who had defected to the U.S. in 1978.3 He described how waves of spies infiltrated the Canadian nuclear industry. The biggest spy success was the theft of the blueprints for a heavy water plant. Such a pilot plant was then built at Bucharest's Institute for Chemical Research, and a full operational plant is being constructed at Cernavoda, site of the CANDU reactors.

The export of heavy water, controlled by the International Atomic Energy Agency (IAEA), is a key element to produce plutonium for nuclear weapons. With its own plant, Romania can avoid intrusive inspections by IAEA. The purpose of the spy thefts was to save scarce hard currency.

Earthquake Zone

Safety maintenance may not be adequate after the reactor is built and the Canadian engineers come home. The site of the five-reactor plant is Cernavoda, a small city on the Danube River, close to the Black Sea. It lies in an unstable seismic area, along the same fault that created the Armenian earthquake. Severe quake activity occurred in 1986 and 1987 in the vicinity of Cernavoda, along the edge of the Carpathian mountains. AECL has never before needed to consider earthquake-proofing in reactor design, and questions remain as to the safety procedures at Cernavoda for such an eventuality.

The problem is further aggravated by Ceausescu, who, after a 1985 trip to Canada, surveyed the containment shells enclosing each CANDU reactor, and complained that the project was using too much concrete.

Working and living conditions in Romania are the most severe in Europe and worsening. The guaranteed minimum wage has been abolished. A former Romanian ambassador recently accused Ceausescu of asking "the workers to commit suicide by starvation and cold." On November 15, 1987, thousands sacked party offices in Brasov after workers in one plant had not been paid for three months and were expected to work an extra night shift.

A clandestine trade union, Libertatea, managed to compose and smuggle out to the Vienna Conference for the Helsinki Accords, a lengthy appeal for basic human rights and survival. Their tragic appeal reveals the price that Romanian citizens, especially children, are paying for our CANDU reactors. They call for "an end to the current state of undernourishment in our country, generated by the absence of basic products, such as bread, butter, meat, eggs, etc. We ask all governments to ban the import of Romanian foodstuff until the country fulfills its domestic needs." Canadians are subsidizing an immoral deal by constructing CANDUs for Romania.

Wally Keeler is with a Toronto computer firm and visits Hungary often.

1. Hitel, Decembewr 14, 1988.

2. Kingston Whig-Standard, Dec. 21, 1987, quoting Prof. George Lerner.

3. Red Horizon, 1987.

Peace Magazine Jun-Jul 1989

Peace Magazine Jun-Jul 1989, page 8. Some rights reserved.

Search for other articles by Wally Keeler here

Peace Magazine homepage