The issue of stability and instability in the Persian Gulf has become so much politicized in the past few years that even the most basic assumptions must be clearly stated.

I believe the following general concepts will help us in our exercise:

1. While Persian Gulf is a vital waterway internationally, the sources of its importance are not identical for all players:

1.1. For littoral states of the Persian Gulf, this waterway is our lifeline. Of course some littoral states, like Iran, depend entirely on the Persian Gulf for their oil exports as well as much of their international commerce, while some others have developed alternative mechanisms for their oil exports, including pipelines to their ports elsewhere, or through other countries.

1.2. For those who are primarily dependent on Persian Gulf as the major supplier of their energy requirements, such as Europe and Japan, Persian Gulf constitutes a major element in their economic and industrial well-being.

1.3. For those who do not depend on Persian Gulf oil, such as the United States, this area is an important theater for extension of their control in international political arena and in international economic competitions.

2. Without attempting to judge the legitimacy of the interest of each category of states in the Persian Gulf, one can easily conclude that there is a qualitative difference between the interest of the first two categories and that of the third.

3. There are domestic, regional and international sources of instability in this region:

3.1. Domestic sources of instability include lack of political and social development commensurate with the economic boom, wide disparity in the distribution of wealth.

3.2. The regional element of instability stems from a fact of geography: that is asymmetries in terms of size, population, economic growth and potential, and the way this asymmetry has been addressed. I will deal with this in greater detail later.

3.3. The international element of instability stems from the divergence of the nature of interest of various outside powers in the region, their competition, and their injection of extraneous issues which further complicate an already complex security situation. The paramount interest of such foreign players may not always be stability, but in fact may depend on what can justify their presence. Furthermore, presence of foreign forces has historically resulted in domestic instability within the recipient countries and exacerbated the existing tensions between these countries and other regional states.

4. The model for security and stability that has been pursued to date in this region has been one based on competition and rivalry and block formation.

Because of geographic and demographic realities of the region, in a competitive scenario, smaller states tend to rely on external powers and/or attempt to purchase security through financing the war machine of another state which in the 1980s was Iraq. As it has been shown by the Iraqi invasion of Kuwait, this approach would foster new imbalances and provide the capability for unrealized, unstated or concealed ambitions to surface and menace the region.

5. The fact is that these imbalances and asymmetries in the region need to be primarily recognized. There are asymmetries in the region, such as size, population, human resources which can not be easily altered in the course of the time. Resorting to the outdated security theories, namely balance of power not only is not applicable in this case, but encourages ambitious plans to purchase the sophisticated weaponry and arms race.

6. I believe that the approach which is the most relevant to this area in that of "Non-offensive defense scheme" which provides credible security for all states in the region, curbs the arms race, builds confidence among states and paves the ground for a more stable and lasting peace and security in the region.

6.1. Therefore, it is imperative to pin point common areas of interest and shared objectives and find cooperative methods of achieving and maintaining those objectives.

There are significant areas of common interest both between countries of the region and between them and those outside the region. For Iran, for instance,

_ Prevention of tension in the Persian Gulf region;

_ Preservation of territorial integrity, political independence and international boundaries of all states in the Persian Gulf region;

_ Free flow of oil and other resources; and

_ Protection of the environment of the Persian Gulf region

constitute absolute imperatives for national security and development. I believe these concerns are generally shared within and outside our region.

6.2. The area of security assurances and guarantees is naturally a more sensitive and difficult one. Confidence building measures through mutual commitment to a number of underlying principles might provide a positive and constructive first step in this regard.

6.3. It is possible also to envisage gradual creation of verification mechanisms with the help of the United Nations, and to develop responsible and balanced methods of arms control, in particular with regard to weapons of mass destruction.

6.4. The main problem here is that, the region is suffering from the lack of a forum for discussions and negotiations on the variety of issues of common interest to all states in the region.

I think that one of the best approaches could be the establishment of a negotiating Conference under the auspices of the United Nations. This Conference should be entrusted to commence discussions on a broad spectrum of security and cooperation issues which I tried to outline in my statement. These issues in a nutshell could be categorized as:

6.4.1. Arms control, disarmament and confidence and security building measures, which would encompass military exchange of information, military activities, military contacts, notifications, observations and concluding non-aggression pacts between regional states, as well as cooperation in respect of non-proliferation and disarmament with regard to the weapons of mass destruction and particularly the establishment of a zone free from these weapons.

6.4.2. Peaceful settlement of disputes.

6.4.3. Human dimensions such as the issues related to the migrants, refugees and displaced persons.

6.4.4. Environment.

6.4.5. Economic cooperation.

6.5. Any regional arrangement should be initiated by the regional countries based on the unique experience, characteristics and historical bonds of the region.

6.6. Any regional arrangement should be limited in its nucleus to the eight littoral states of the Persian Gulf. Inclusion of other states will bring with it other complex issues, overshadowing the immediate problems of this region and further complicating the complex nature of Persian Gulf security and cooperation.

6.7. All eight countries of the Persian Gulf region, including Iraq, must ultimately be included in the security and cooperation arrangements in the Persian Gulf area. Any exclusion will be the seed of future mistrust, tension and crisis.

6.8. To prevent the domination and/or imposition of the views of any single country or group of countries, and furnish the necessary international umbrella which would provide the international community with assurances as well as mechanisms for safeguarding its legitimate interests, arrangements should be envisaged within the framework of the United Nations and with the active and serious cooperation of its Secretary-General. The necessary institutional framework has already been provided in Security Council Resolution 598.

Let me conclude by making a final observation. We know that the establishment of a viable regional security and cooperation arrangement in the Persian Gulf area is not an easy task. Differences between the countries in the region, some publicized and some less a matter of international public attention, do exist, and require an approach which is sensitive to these concerns and problems. But it is important to build a new system in this strategic region based on the lessons that we have learned from the past not to repeat the same mistakes.