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By Colin Woodard Special to The Christian Science Monitor

KWAJALEIN, Marshall Islands (December 8, 1999 – Christian Science Monitor)---From the air, you'd never guess that Kwajalein Atoll was of considerable strategic significance to the United States.

This remote ring of coral islets is set in the very center of the vast Pacific Ocean and is far from just about everything. Most of its islets are little more than glorified sandbars covered in coconut and pandanus trees, looking very much like a tropical paradise.

But Kwajalein is more "Dr. Strangelove" than "Blue Lagoon." Today it sits at the center of complicated ongoing negotiations that will have serious consequences for both the Marshalls and the development of the Pentagon's $10.5 billion National Missile Defense (NMD) program.

That's because leaders of the tiny Republic of the Marshall Islands, a former U.S.-administered Trust Territory, want to raise the rent the U.S. pays for use of Kwajalein Missile Range, a key facility for NMD testing.

"We think the Marshallese people are entitled to a much better deal for use of this unique asset," said Foreign Minister Phillip Muller. The current U.S. payments for use of Kwajalein - about $12 million annually - must be raised to an unspecified "fair-market value," he said.

Kwajalein has been at the center of U.S. nuclear weapons development since it was captured from Japan near the end of World War II. It was the staging ground for 67 above-ground U.S. atomic tests at Bikini and Enewetak atolls in the 1940s and '50s.

For the past four decades, Kwajaelin's 850 square mile lagoon has served as the bull's-eye for tests of intercontinental ballistic missiles launched from California's Vandenberg Air Force Base, 5,000 miles away. Virtually every ICBM in the US arsenal was test fired at Kwajalein, from Titan and Polaris to the MX. The Pentagon has invested more than $4 billion in sophisticated systems that track incoming warheads. Divers can then recover warheads and test vehicles from the shallow lagoon.

"[Kwajaelin's] the only place where you can do exoatmospheric tests of long-range missiles," says Bill Congo of the Army's Space and Missile Defense Command in Huntsville, Ala., which operates the Kwajalein Range. "We've been testing out there for 40 years, and it's been a very successful facility."

With the end of the cold war, Kwajalein Missile Range's future looked bleak, with budget cuts and downsizing. But its prospects changed almost overnight in August 1998 when North Korea test fired a medium-range Taepo-Dong missile over Japan, shocking defense planners and reviving support for the creation of a missile shield to protect the U.S. and its allies.

"Missile defense has given a new lease on life for the Kwajalein base," says Richard Baker, an expert at the East-West Center in Honolulu.

During NMD tests, intercept vehicles are launched from Kwajalein to destroy incoming missiles. The current prototype - the Exoatmospheric Kill Vehicle - is designed to soar into space at more than 4,500 miles an hour, identify and evade decoys, and strike an incoming warhead with such force that both vehicles are vaporized. "Without Kwajalein they'd never get the proper trajectory and altitude to test this kind of system," says Dan Smith of the Washington-based Center for Defense Information.

Under current treaties, the U.S. can unilaterally extend its leases on Kwajalein for another 15 years at fixed rents, and the Pentagon's official position is that no negotiations are necessary. As a practical matter, however, it would be extremely difficult to continue operations at Kwajalein without the cooperation of the Marshallese.

The base was created after World War II, when the Marshall Islands were a U.S.-administered United Nations Trust Territory, and hundreds of residents were forced from their homes with little compensation. During the 1970s and 1980s, exiled landowners organized civil protests, including the reoccupation of restricted islands, forcing the U.S. to increase rents. Imata Kabua, one of Kwajalein's biggest landowners, led many of the protests; he is now president.

Mr. Muller has hinted at a resumption of such protests should the U.S. refuse to renegotiate. "We know from history what they are capable of doing," he told Reuters in February.

In the Marshallese capital, Majuro, most hope the U.S. will increase rents at Kwajalein. But, speaking privately, many here fear that some of the country's leaders may use Kwajalein's newfound leverage to promote their own interests, rather than those of the country. The Marshall Islands are in the midst of complex negotiations over the future of U.S. development support that now runs about $40 million a year - a figure that represents nearly three-quarters of the country's gross domestic product.

Dozens of interviews indicate that outside government circles there appears to be considerable support among Marshallese for the U.S. to enhance oversight and accountability over any new funds it provides. Years of mismanagement and abuse of power by some government officials resulted in major gains for the opposition party in elections held Nov. 15, the first electoral defeat for the ruling circle since the Marshalls gained independence 13 years ago.

Former U.S. Ambassador William Bodde says the nearly $1 billion the Marshalls has received from the U.S. over the past 15 years "has produced a few millionaires, but most of the population continues to live under deplorable conditions."

Even in Majuro, essential services such as education, health care, and waste disposal are dismal. On Ebeye, a 78-acre islet on Kwajalein Atoll that is home to more than 14,000 Marshallese, electricity and water supplies are sporadic. Meanwhile, the government has lost millions on failed hotels and expensive aircraft.

Marshallese negotiators could try to use Kwajalein's value to the Pentagon to increase pressure in Washington to minimize the strings attached to any future U.S. development support. "They're hoping the Defense Department is going to save the day for them," a knowledgeable source in Majuro says. "They'll play Kwajalein for everything they can."

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