The International Atomic Energy Agency is the world's central intergovernmental forum for scientific and technical co-operation in the nuclear field. It works for the safe， secure and peaceful uses of nuclear science and technology， contributing to international peace and security and the United Nations' Sustainable Development Goals.
In January， 1984， China joined in the IAEA
China acts designated member of the Board of Governors
China has provided comprehensive support to the IAEA
China has signed or joined to 12 international conventions in the nuclear field
China is the second largest contributor to the IAEA - Assessed Contributions
China will continue to contribute to the Nuclear Security Fund
This work has been supported in part by voluntary contributions made by Member States to the Nuclear Security Fund， Division of Nuclear Security， Department of Nuclear Safety and Security， within the International Atomic Energy Agency.
The 1st installment discusses security and safety vulnerabilities of global trade， the impact of those vulnerabilities， and suggests a revised approach to address those vulnerabilities using， in many cases， existing security infrastructure for dual (or multiple ) purposes.
The 2nd installment discusses commercial fraud within the global containerized supply chain， illicit trafficking in nuclear material， and obligations of States with respect to nuclear safety and security.
The last installment covers the United Nations’ Sustainable Development Goals (SDGs) and their relevance to the Belt Road Initiative; and discusses approaches for management of risk in trade that utilize nuclear detection technologies to enhance safety， security， and trade facilitation.
集装箱② 作为供应链物流的重要载体，在海、陆、空运输中得到广泛应用，为各国带去可观的经济效益。据欧盟委员会统计，预计在2018-2026年间，全球集装箱贸易将以平均4.6%的速度持续增长。其中，2019-2023年，预计全球集装箱海港吞吐量将以每年5.5%的速率增长，达到近10亿标箱。然而，集装箱虽能加快货运速度，推动贸易发展，但由于其封闭性，和内载货品的不可视性，成为组织犯罪集团进行非法③ 贩运的载体， 对贸易活动的安全构成威胁。威胁包括:毒品贩运，假冒商品，烟草走私，核生化武器及其部件的非法贩运，以及受污染货物或未受控的有害废物形式存在的安全威胁。此外，用封闭集装箱运输货物也会导致商品的漏报和瞒报等逃税行为的频发。
A DISCUSSION SERIES ON FACILITATION OF SAFE AND SECURE TRADE
USING NUCLEAR DETECTION TECHNOLOGIES
—The Mutually Supportive Relationship Between Facilitation， Tariff Collection， Safety， and Security
Trade and supply chains between countries and regions have formed a closely related， complex， and interconnected web of the global economy. Trade is critical to the economic well-being of a nation and provides significant revenue through the collection of customs tariffs on traded goods. Taxes on international trade account for a large share (often around 40 percent) of total tax revenue in low-income economies. Connectivity in logistics， finance， and information is the foundation of sustainable trade. While growing international trade moving more and more packages at faster speeds enhances the interdependence between countries and regions， the global trade system continues to be vulnerable to transport of commodities posing safety hazards or security risks through exploitation by non-state actors to carry out illegal， illicit， criminal， or terrorist activities.① To address the broad range of illicit activities， States have adopted obligations through legal mechanisms such as United Nation Conventions and Treaties. However， addressing these many obligations is a difficult balance given， among other factors， the complexity of illicit activities， concerns over negative impacts on the global supply chain， and financial and manpower resource constraints.
This paper is the first in a series of three installments that discuss security and safety vulnerabilities of global trade， the impact of those vulnerabilities， and suggest a revised approach to address those vulnerabilities using， in many cases， existing security infrastructure for dual (or multiple) purposes. The reconsidered approach changes the paradigm that security and safety measures negatively impact the flow of trade. Instead of looking at safety， security， and revenue collection as diametrically opposed to facilitation of trade， the relationship can be one of harmonious integration for the benefit of all legitimate users of the trade system.
Over the course of this discussion series， we will describe the international supply chain， with a focus on containerized cargo movement， and highlight the cost of vulnerabilities in terms of lost tariff revenue， safety hazards and security risks， and societal costs from illicit trafficking (drugs， cigarettes， hazardous waste， and nuclear material) and commercial fraud. Through enhanced use of existing infrastructure， with an emphasis on non-intrusive inspection technology and information technology， the economic case will be presented on (1) the cost of infrastructure versus cost of illicit acts， and (2) the cost of continual loss from commercial fraud.
The topic of this discussion series is particularly relevant， given sustained increases in both legal and illicit cargo volumes with corresponding issues with commercial fraud， and the reality that no single country is isolated from events that occur on the global stage. Sustained issues with the global supply chain both demonstrate that globally coordinated efforts are required to ensure public health， safety， and security， and that science and technology is needed to provide it.
In this first paper of the series， we describe the international containerized cargo supply chain and the societal costs from illicit trafficking of drugs， cigarettes， and hazardous waste. Future installments will discuss illicit trafficking in nuclear materials; evasion of customs duties; additional obligations of States with respect to Chemical， Biological， Radiological， Nuclear， and Explosive (CBRNE) threats; the United Nations’ Sustainable Development Goals (SDGs) and its relevance to the Belt Road Initiative; and a path forward demonstrating that through the use of science and nuclear detection technology， it is possible that security and speed of commerce no longer need to be viewed as a trade-off. Instead， it is possible that many of the existing measures used by States to ensure safety， security， and tariff collection， could also facilitate trade.
Containers2 are an essential vehicle for supply chain logistics， and its use in wide-ranging transportation sectors including sea， land， and air， brings considerable economic benefits to countries. According to the European Commission， "Containerized trade is expected to continue its growth during 2018-2026 at the average rate of 4.6% worldwide. The global container seaports' throughput is forecast to grow by 5.5% annually in 2019-2023， reaching almost 1，000 million TEU." However， the inherent features of containers such as ability to quickly move contents and the invisibility of contents– features that fuel the growth of containerized trade – are also inherent features that enable containers to become a carrier of security and safety threats in the form of illegal activities.③The safety and security threats include， among others， drug-trafficking， counterfeiting of goods; tobacco smuggling; movement of chemical， biological， or nuclear weapons or their components; and safety threats in the form of contaminated goods or uncontrolled hazardous wastes. Additionally， transport of goods in opaque containers can also increase evasion of Customs duties through misdeclaration and under-declaration of goods.
As the size of large container vessels continues to increase and other efficiencies in port and the intermodal transport system are realized， containers will continue to be the cheapest way to ship cargo internationally. The average global costs of moving a full cargo container from a factory to a buyer’s destination is on the order of US $1500 to $3000 for a 20’ and 40’ container， respectively.④This very low cost comes from economies of scale which can work both for legal and illegal cargo shippers. Larger ports and container ships moving hundreds to more than 20，000 TEUs5 on a single vessel make legal movement of cargoes more efficient， but also make the movement of illegal cargoes more reliable and difficult to detect.
2. Illicit Trafficking of Drugs， Cigarettes， and Hazardous Waste
2.1 The Drug Trade
For ocean carriers and their shipping customers， the use by drug smugglers to piggyback on efficient supply chain operations is a concern in international supply chains. The drive to stem drug flows raises costs and slows shipments， while at the same time， highlighting difficult security and safety questions as operators pursue greater size and speed of ocean-going vessels and greater efficiencies in port cargo handling operations. “Ocean carriers saw a series of seizures of large shipments of drugs in the United States (U.S.) and Europe in 2019， and officials say they are a sign of the growing use of commercial shipping operations for increasingly large loads of cocaine， heroin and other drugs. Officials say the growing scale of shipping operations， with the biggest container ships doubling in size over the past decade， has made it an attractive target for drug traffickers.”
In the absence of data on the flow of all illicit drugs - both those that are seized and those that successfully evade enforcement officials—policymakers can use certain drug seizure data to better understand how and where drugs are crossing borders. According to Mr. Richard Kerlikowske， former Commissioner of U.S. Customs and Border Protection (2014-2017) and the Director of the Office of National Drug Control Policy (2009-2014)， intelligence received from arrested smugglers and law enforcement partners in Mexico indicate that cartels clearly prefer moving high-profit narcotics through the busy ports of entry because their chances of success are better there.iii The preference for smuggling using legal crossings is illustrated by figures from the U.S. showing that a fairly consistent percentage of drug seizures actually occurs at legal crossing points and not at other border locations. During the period 2012-2018， approximately 88% of heroin， 86% of cocaine， 82% of methamphetamine， and 86% of fentanyl6 seized by officials was smuggled through legal crossings.
At ports of entry throughout the world， governments such as the U.S. are increasingly relying on X-ray technology to detect such illegal drugs.v In January 2019， U.S. Customs and Border Patrol (CBP) used X-ray technology to detect the largest stash of the synthetic opioid fentanyl ever seized in CBP history. Underneath a load of cucumbers， in a false floor in the rear of the trailer， was nearly 254 pounds of fentanyl and 395 pounds of methamphetamine--with a street value of about $4.6 million. In June 2019， after "anomalies" were detected in several of containers at the Port of Philadelphia， further inspections involving fiber-optic scopes， narcotic-detector dogs and an X-ray scanner led to the discovery of 15，000 bricks of cocaine， weighing a total of about 35，000 pounds， with a street value of approximately US $1 billion.vi In July 2019， Australian border officials used a large X-ray device to crack a major drug-smuggling case involving a second-hand excavator transported to Australia by ship. The hydraulic arm of the construction equipment was stuffed with 384 kilograms of cocaine valued at AUS $132 million.
The cost of the illegal use of the containerized supply chain is immense. The cost of just policing and interdiction of illicit drugs globally costs over US $100 billion annually. Meanwhile conservative estimate of the annual value of illicit drug markets is over US $330 billion – a huge resource in the hands of criminal networks and available for fueling corruption.viii Societies also bear a high cost linked to problematic drug use， including the cost of drug-related crime and of health and social services needed by people with drug dependence or people unable to protect themselves from other bloodborne disease.
To address the threats posed by illicit trafficking in drugs， the United Nations has a long history of action on the part of the Member States. Conventions requiring action include: the Single Convention on Narcotic Drugs of 1961 as amended by the 1972 Protocol; the Convention on Psychotropic Substances of 1971; and the United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances of 1988 with final acts and resolutions. There are several Articles of Interest in this last Convention relevant to trade. Under Article 15(3)， each party to the Convention “shall seek to ensure that commercial carriers and the appropriate authorities at points of entry and exit and other customs control areas co-operate， with a view to preventing unauthorized access to means of transport and cargo and to implementing appropriate security measures.”
Article 9 of the Convention describes other forms of international cooperation and training that the Parties shall undertake. These mandates include that Parties shall “assist one another to plan and implement research and training programmes designed to share expertise…and， to this end， shall also， when appropriate， use regional and international conferences and seminars to promote co-operation and stimulate discussion on problems of mutual concern， including the special problems and needs of transit States.” Additionally， the Article describes training programmes that shall deal with detection and monitoring of the movement of drugs， and the methods used for transfer， concealment or disguise.
The Convention does not prescribe the research activities needed or methods (e.g.， specific technologies， intelligence， or data analytics) to use for the detection and deterrence of illicit trafficking of drugs， but the value and use of nuclear detection technologies is clear. As described earlier in this section， the use of X-ray technology has led to significant seizures of drugs. The use of X-ray technology in large fixed facilities， mobile platforms， and handheld devices is just one application of nuclear detection technology to detect drugs. Other viable options include technologies such as neutron interrogation. Improvements in the development and use of nuclear detection technologies integrated with other sensors and information can be used to assist in the fight against the illegal trade in drugs.
2.2 The Cigarette Trade
A 2009 study determined that 11.6% of the global cigarette market is illicit， equivalent to 657 billion cigarettes a year and $40.5 billion in lost revenue with the majority of the revenue ($23 billion per year) lost in low and middle income economies. In the case of cigarettes， the costs presented above were only for lost tariff revenue. If the cost in terms of lives and medical care are included， the numbers are many times higher. For example， if illicit cigarette smuggling was eliminated， estimates are that over one million lives would be saved within 6 years (mostly in low and middle income economies).
A recent seizure in Hong Kong is one example of many that illustrates the illicit cigarette trade problem. In February 2020， Hong Kong Customs seized 4 shipping containers loaded with some 31 million cigarettes worth about US $11 million. Before reaching Hong Kong， the containers carrying the cigarettes were shipped through Japan， South Korea， Vietnam， and mainland China， according to Lee Hoi-man， deputy head of the Revenue and General Investigation Bureau under Customs.xi The circuitous route was used by smugglers in an attempt to avoid detection， illustrating the global connectivity of illicit trafficking， and the contents listed on import documents were changed to throw off law enforcement in various jurisdictions that rely primarily upon risk management systems based on shipping documents.
In 2018， more than 20 million illicit cigarettes were seized in a joint operation involving the Australian Border Force (ABF). The two sea cargo containers of interest from Vietnam were interdicted at a transshipment port before they reached Australia. According to authorities in Australia， the cigarettes were “worth about AUS $14.2 million dollars7 in evaded revenue and had they made it into the Australia market without duty being paid， that money would have likely flown straight to other criminal pursuits.”
To address the negative effects of illicit usage of tobacco， governments and international bodies such as the World Health Organization (WHO) have taken actions such as the 2012 Protocol to Eliminate Illicit Trade in Tobacco Products (Protocol). The Protocol was negotiated under the Framework Convention on Tobacco Control and is one of the efforts by the parties to the WHO to combat the trade in illicit tobacco products. The Protocol is an international treaty with the objective of eliminating all forms of illicit trade in tobacco products through a group of measures to be taken by countries acting in cooperation with each other: it is intended to be a global solution to a global problem. As of April 2020， the Protocol counts 58 Parties.
The Protocol was developed in response to the growing illicit trade in tobacco products， often across borders， and places special emphasis on cooperation at regional and sub-regional levels to combat illicit trade of tobacco products. Illicit trade poses a serious threat to public health because it increases access to – often cheaper – tobacco products， thus fueling the tobacco epidemic and undermining tobacco control policies. It also causes substantial losses in government revenues， and at the same time contributes to the funding of international criminal activities.
The Protocol requires the establishment of a global tracking and tracing regime within five years of the Protocol’s entry into force， comprising national and regional tracking and tracing systems and a global information sharing point which is only possible by adopting technologies supporting supply chain visibility. According to the Tobacco Products Directive 2014/40/EU， by 20 May 2019 the traceability system and the security features should be in place in the Member States for cigarettes and roll-your-own tobacco， and by 20 May 2024 for all other tobacco products (such as cigars， cigarillos， and smokeless tobacco products). Thus， all the organizations would need to implement traceability and supply chain visibility measures to overcome the illicit trade of tobacco products.
One solution to address the illicit trade in cigarettes and provide better visibility， detection， and deterrence， is the enhanced use of existing technologies and processes. Not only can the “active” nuclear technologies of X-ray system be used to detect cigarettes， but “passive” radiation detection systems could be used as well. 8 As presented at the World Customs Organization’s 2017 Conference on The Power of Big Data， Advancing Border Management， a global research effort coordinated by the IAEA demonstrated that cigarettes (tobacco and various filters) have distinct radiological characteristics due to presence of different naturally occurring radioactive materials.xv The presence and concentrations of various radioisotopes in tobacco can provide information about the possible origin and form (raw tobacco， stemmed tobacco， etc.). Additionally， the processing， packaging and other technological processes， including the use of additives for bringing raw materials to consumers， can significantly change radioactive contents in cigarettes. Studies have also shown that there is a measurable difference in radioactive content between illegal and legal cigarettes.xvi Using passive radiation detection systems， it may be possible to quickly detect the presence of cigarettes and even differentiate between legal and illegal cigarettes brands. The deployment of passive and/or active detection technologies provides a significant detection and deterrent capability against illicit trafficking of cigarettes.
2.3 The Hazardous Waste Trade
International scrutiny of waste trafficking has revealed an enormous and lucrative criminal industry with considerable involvement of transnational organized crime groups. Illegal trafficking of hazardous and other wastes， including e-waste， is specifically defined under the 1989 Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal with further amendments to the Convention adopted subsequent to its entry into force and that are in force as of 27 May 2018. Parties to the Convention are required to introduce national/domestic legislation to prevent and punish the illicit trafficking of hazardous waste.
The Convention contains obligations of States to ensure that any transboundary movement of hazardous wastes and other wastes is reduced to the minimum and conducted in a manner which will protect human health and the environment; and consider that illegal traffic in hazardous wastes or other wastes is criminal. The Convention also obligates States to co-operate in activities with other Parties and interested organizations including the dissemination of information on the transboundary movement of hazardous wastes and other wastes， in order to improve the environmentally sound management of such wastes and to achieve the prevention of illegal traffic.
Globally， the illegal trade in hazardous waste is estimated to generate revenue of US $12 billion a year for criminal enterprises. Depending on the requirements in each country， illegal disposal is estimated to be up to four times cheaper than legal treatment.xviii The European Union Network for the Implementation and Enforcement of Environmental Law (IMPEL) suggests that as much as 85% of the non-hazardous waste exported from the EU is shipped illegally or in non-compliance with regulations. Globally， the annual turnover in the illegal trade of environmentally sensitive commodities is estimated at around $21.33 billion.
As a result of the high volume of material and the difficulty in detecting the movement of it， illegal trafficking of waste has become one of the fastest growing areas of crime， attracting the growing interest of unscrupulous brokers as well as criminal networks. To evade law enforcement agencies， smugglers trafficking in hazardous waste and electronic waste often customs-code classify goods as second-hand products and thereby bypass customs regulations and international conventions. Criminals shift swiftly between types of contraband or to alternative geographic locations in response to geographically or thematically limited enforcement operations.
According to the 2016 joint United Nations Environment (UNEP) - Interpol report， environmental crime dwarfs the US $3 billion illegal trade in small arms.xxi It is the world's fourth-largest criminal enterprise after drug smuggling， counterfeiting and human trafficking. The UNEP estimated that the annual cost of environmental crime in 2016 was between US $91–258 billion， with waste accounting for $12 billion of the total， making the money lost due to environmental crime 10，000 times greater than the amount of money spent by international agencies on combatting it - just US $20-30 million. Environmental crimes can potentially affect a variety of sectors in any society and are often linked with the exploitation of disadvantaged communities， human rights abuses， money laundering and corruption.
An untapped technology existing at many points of entry， and at a number of transshipment hubs， that could be used to detect illegal trafficking of many hazardous wastes and help States fulfill obligations under the Basel Convention is the use of Radiation Portal Monitors (RPMs). Many of the wastes covered by the Basel Convention， listed in Annexes VIII and IX， in particular， include metal and metal-bearing wastes and wastes containing principally inorganic constituents. From a radiological perspective， the majority of these wastes contain measurable quantities of Naturally Occurring Radioactive Materials (NORM) and can be easily detected using RPMs; and depending on the type of detector provide further insight into the origin and makeup of the material. When compared against expected radiation responses， the RPMs provide a powerful tool for verifying contents of a cargo declaration. RPMs are a fast and inexpensive way of getting this valuable information， and identifying anomalies in paperwork， with minimal impedance of traffic for inspections. With the additional use of active nuclear detection technologies that can provide images of containers， depending on the technology， additional chemical/element identification， the power of nuclear detection technologies in combatting illicit trafficking is apparent.
This paper described the containerized cargo supply chain and the societal costs from illicit trafficking of drugs， cigarettes， and hazardous waste. Application of existing security infrastructure that can detect and deter illicit trafficking in these commodities was briefly discussed. The next installment will discuss commercial fraud within the global containerized supply chain， illicit trafficking in nuclear material， and obligations of States with respect to nuclear safety and security. The last installment will cover the United Nations’ Sustainable Development Goals (SDGs) and its relevance to the Belt Road Initiative; and discuss approaches for management of risk in trade. The installment will conclude the series by describing a path forward demonstrating that through the use of science and nuclear detection technology， it is possible that security and speed of commerce no longer need to be viewed as a trade-off. Instead， it is possible that many of the existing measures used by States to ensure safety， security， and tariff collection， could also facilitate trade.
1 An illegal act is a violation of law， but even this term can apply to civil offenses. Illicit carries a strong connotation of immorality and could also be illegal， and criminal denotes punishable wrongdoing. A ‘criminal act’ is normally covered by criminal or penal law in a State. In addition， criminal acts involving nuclear or other radioactive material may constitute offences related to acts of terrorism， [including those set out in the Convention on the Physical Protection of Nuclear Material and its Amendment and the International Convention for the Suppression of Acts of Nuclear Terrorism] which， in some States， are subject to special legislation. (International Atomic Energy Agency， 2015).
2 For the purposes of this document only， the term container includes maritime containers， aircraft containers and any portable compartment in which freight is placed (as on a train， truck， aircraft or ship or any other means of conveyance) for transportation.
3 Illegal activities include， but are not limited to， those conducted by individuals， organized criminal groups， businesses， and non-state actors.
4 Values are taken as averages of 2019 shipping costs from https://www.chinaimportal.com/blog/shipping-costs-when-importing-from-china-a-complete-guide/， https://www.icontainers.com/ship-container/united-states/， and also https://moverdb.com/container-shipping/ for international shipping costs.
5 One Twenty Foot Equivalent Unit (TEU) is a unit used to express the value of cargo capacity based on the volume of a standard 20’ long container with an 8’ width and 8’6” height.
6 Official reporting of data for fentanyl by US CBP only began in 2015.
7 Approximately US $10.8 million using June 2018 conversion rates.
8 For purposes of this paper， “active” technologies are those involving the emission of some form of radiation， while “passive” technologies are those detect radiation without any emissions.