The Rakon files: Parts don't need export okay, says PM

Herald inquiries revealed Rakon had knowingly provided a key component of smart bombs for the past 10 years. Picture / Paul Estcourt

Star technology firm Rakon's crystals and oscillators which are used in smart weapons' navigation systems do not require export permits "at the moment", says the Prime Minister.

"As far as we can ascertain, Rakon's oscillators and crystals are not on the internationally agreed list of controlled goods and therefore do not require export permits," a spokesman for Helen Clark said yesterday.

"This is a list that is compiled by member countries signed up to the export control regimes of which New Zealand is a member.

"These lists aren't static, they are added and deleted as technology changes and things develop, but as far as we can ascertain these oscillators and crystals have a wide range of potential uses in communication and navigation technology and they are not on any list of controlled goods. "That's where the Government's position is at the moment."

The Weekend Herald reported that despite claiming last August not to know the end use of its products, Rakon has knowingly provided a key component of smart bombs for the past 10 years, is developing a component of a product for the US nuclear defence programme, and one which turns dumb shells into smart shells.

The report disclosed that Rakon, which last year won the New Zealand Trade and Enterprise supreme award for exports, had not been upfront at times in the past with clients over complaints of faults with products.

JDAM smart bombs used in the war in Iraq have almost certainly contained key Rakon components.

The Government is opposed to the war, which the Prime Minister has described as "wrong".

Although export regulations don't specifically identify crystals and oscillators as products that must be vetted before being sent overseas, there are sections which appear to deal with goods for guidance systems.

These mention goods that can be used in "the handling, control ... of bombs, torpedoes, rockets [and] missiles ... target acquisition, designation, range-finding, surveillance or tracking systems ... guidance and navigation for [naval] military use" as exports that may be restricted.

Green MP Keith Locke said the issue could have been sorted out when it arose last August if the Ministries of Economic Development and Foreign Affairs and Trade, and the Security Intelligence Service, which talks about its "role in stopping New Zealanders being involved in anything connected with nuclear weapons", had investigated.

"It seems all these agencies were so bedazzled by Rakon's export success they were reluctant to investigate properly then and ask hard questions."


RAKON REPLIES

Statement issued by Rakon Limited, May 27, 2006:

In response to coverage in the New Zealand Herald, May 27:

There is no hidden story. Rakon has fully disclosed the use of its products for military and aerospace applications in its recently published offer document.

We are disappointed and surprised that the Herald did not contact Rakon to verify any of the details in its article.

Rakon is proud of the quality of its products and the consistently superior quality ratings achieved across its broad customer base.

None of our products are being designed or manufactured for use in nuclear weapons.

Rakon has not invented technology specifically for US smart bombs. Although the military and aerospace industry is an important market for Rakon, it comprises less than 4% of Rakon's output by unit volume.

We are disappointed that the Herald has taken internal emails and distorted them out of context to sensationalise them.

- Brent Robinson, managing director, Rakon Ltd