As we approach the new millennium we are witnessing an increased demand for and use of nuclear technologies, a heightened awareness of the safety imperatives and of safeguards and physical protection requirements, consolidation of detente and the beginning of nuclear disarmament. These developments are coming together to create additional challenges and new opportunities. In my introductory statement this morning, my first to you as Director General, I would like to open by offering some perspectives on the coming years. I will then turn to some specific areas of our work and to matters on the Agenda for this meeting.

The Agency was established forty years ago to promote peace and development. History has shown that its twin objectives - to maximize the benefits of nuclear energy for human development and to ensure that nuclear energy is used safely and peacefully within a sound framework - clearly go hand in hand. Without peaceful uses of nuclear energy, there will not be much need for nuclear safety or safeguards. And, conversely, without nuclear safety and safeguards, there will not be much use of nuclear energy. The Agency's founders understood this symbiotic link, and States have renewed and refined it through instruments such as the Treaty on the Non-Proliferation of Nuclear Weapons and agreements to set up nuclear-weapon-free-zones. Our role is to see to it that the Agency's twin objectives are equally supported with vigour by all IAEA Member States and that no divide is allowed.

The twin objectives entail a number of major tasks. Maximizing the benefits of nuclear energy is a threefold task:

• to act as a catalyst for the scientific community and as a hub for state-of-the-art technology;
• to conduct comparative assessments on the risks and benefits of nuclear and other technologies, thereby enabling States to make informed and appropriate choices; and
• to act as a centre for the transfer of nuclear technologies so as to ensure their accessibility to Member States in general, and to developing countries in particular.

The Agency's objective of ensuring nuclear energy's use within a sound framework is twofold:

• to assure, through its verification system, that pledges to use nuclear energy exclusively for peaceful purposes are fulfilled; and equally
• to strive for the highest level of safety in all areas of nuclear energy's use.

In several countries, the role of nuclear energy for electricity is being revisited. One focus is on the contribution of nuclear power to combat the greenhouse effect. Right now, nuclear energy - which accounts for the avoidance of about 8 per cent of carbon dioxide emissions - is already a mature and readily available technology for cost-effective mitigation of greenhouse gases over the long term. Equally, the role of nuclear power in helping countries achieve a degree of energy independence is becoming more widely recognized. Recent studies foresee an increase in electricity demand worldwide by a factor of two to three by the year 2030 and in Asia by a factor of seven and more. These demands are mostly driven by growing economies in the developing world. The projection is that the fast-growing demand for energy will require the use of all available energy sources on the one hand, and a switch to a more environmentally friendly mix on the other. That mix certainly will vary from one country to the next and will be driven by economic, environmental, and geopolitical factors. The contribution of nuclear power to that mix will be influenced by the degree of public trust in the safety of both its operation and of the waste disposal and in the regime to guard against its diversion to non-peaceful ends. Nuclear power alone cannot ensure secure and sustainable energy supply worldwide, nor can it be considered as the only means of reducing greenhouse gas emissions. But together with renewable sources, improved fossil fuel conversion, and efficiency improvements throughout the energy system - all of which are important - nuclear power could play a key role in strategies aiming towards these goals. The Secretariat will be making these points to the Kyoto Conference on Climate Change this week. A central challenge for the Agency is to provide objective comparative assessments of alternative energy scenarios, including, when requested, country-specific energy and electricity analyses and planning. Its expertise should remain available to countries which have decided to avail themselves of the nuclear power option. .

Mr. Chairman, let me now turn to some recent developments relevant to our work; starting with the Agency's Security Council mandate in Iraq.

On 16 October the Director General informally briefed the Security Council on the Agency's work in Iraq and introduced the Agency's fourth consolidated report on progress in implementing its Security Council mandate.

Governors will be aware that in late October the Agency's implementation of its Security Council mandate in Iraq was interrupted for a period of 23 days. The Agency and UNSCOM personnel returned to Iraq on 21 November and the Agency's Nuclear Monitoring Group was able to resume its work on the next day. Inspections since then have accounted for all significant items that had been relocated during the period when inspection activities were interrupted.

In response to a report issued by the emergency session of the UNSCOM commissioners, the President of the Council issued a statement on December 3rd, which inter alia demanded that Iraq fulfill all its obligations; and encouraged UNSCOM and the IAEA to intensify their efforts to implement fully their respective mandates.

I should report that since 1991 the Agency has conducted 29 on-site inspection campaigns in Iraq involving more than 500 facility inspections and more than 5000 person days. The Agency has conducted a comprehensive campaign to destroy, remove, and render harmless all items of Iraq's clandestine nuclear programme that came to its knowledge. This campaign was essentially complete by November 1992. Since that time only a relatively small number of items of proscribed equipment and material have been identified and disposed of. Additionally, all known nuclear-weapon-usable material was removed from Iraq. The safeguarded research reactor fuel was verified and fully accounted for before removal. The Agency phased in its Monitoring and Verification (OMV) plan incrementally from November 1992 to August 1994. Since then it has maintained a continuous OMV presence in Iraq. The IAEA's activities regarding the investigation of Iraq's clandestine nuclear programme have reached a point of diminishing returns and the Agency is focusing most of its resources on the implementation and technical strengthening of its plan for ongoing monitoring and verification. Naturally the Agency will continue to exercise its right to investigate any aspect of the clandestine programme should new information come to light.

The Agency's fourth consolidated report identifies five matters which require further clarification by the Iraqi counterpart. The resolution of these matters would provide further assurance that the technically coherent picture of Iraq's clandestine nuclear programme is comprehensive and that there are no activities which are outside that picture. Further, a fuller understanding of the technical achievements of Iraq's programme will enable the Agency to tailor its ongoing monitoring and verification activities appropriately. The Agency plans to send a team headed by the Action Team Leader to Iraq this month to seek to resolve these matters.

Finally, I should note that although there are no indications of significant discrepancies between the technically coherent picture of Iraq's past programme and the information contained in Iraq's "Full Final and Complete Declaration, no absolute assurances can be given with regard to its completeness. As we reported to the Security Council, some uncertainty is inevitable in any country-wide technical verification process which aims to prove the absence of readily concealable objects or activities. The extent to which such uncertainty is acceptable is a policy judgement.

With respect to the implementation of safeguards in the Democratic People's Republic of Korea the Board was informed in September that the situation summarized in the report for the General Conference remained unchanged and that an eighth round of technical discussions was expected to take place in Vienna in the week beginning 20 October 1997 That meeting took place as scheduled but I have to report that again no progress was made on important issues. These include the preservation of information which must remain available to enable the Agency to verify in the future the correctness and completeness of the DPRK's initial declaration and compliance with the Safeguards Agreement. They also include verification activities connected with the reprocessing plant. For example, the DPRK again declined to accept measurement of the liquid nuclear waste to verify that there is no movement or any operation involving such wastes.

I should also report that the whole canning operation for the irradiated fuel from the 5 MWe Reactor is now expected to be completed by the Spring of 1998. This will permit us to supplement existing surveillance arrangements by having the containers with all the fuel rods under Agency seals. The continuous presence of inspectors in the Nyongbyon area is

The process of corresponding with almost 200 States and other parties inviting them to conclude an Additional Protocol to their safeguards agreement(s) is now practically completed. Some 34 States have indicated their intention to conclude the Additional Protocols at an early date.

Already six Additional Protocols have been approved by the Board. I am pleased that a seventh agreement is before the Board this week - a Protocol Additional to Lithuania's Safeguards Agreement pursuant to the NPT.

I am also pleased to report that on 2 December consultations were held in Luxembourg about Additional Protocols between the Agency, the European Atomic Energy Community (Euratom) and the 13 Non-Nuclear-Weapon States of the European Union; and also between the Agency and Euratom and each of the two Nuclear-Weapon States of the Union. At this meeting the Agency was informed that the Council of Ministers of the European Union had, on 1 December, approved directives for the European Commission to negotiate tripartite Additional Protocols with the IAEA and with the respective EU Member States.