Export control systems should be modernized to improve performance and competitiveness in the world defense markets by implementing a modern system that will be more efficient, predictable and transparent. In an open letter to President George W. Bush, the newly formed Coalition for Security and Competitiveness outlined several proposals to modernize the export regulation process.
The coalition recommended the implementation of more efficient export control regulatory management, by identifying and safeguarding the sensitive and militarily critical technologies essential for US defense, facilitating defense trade and technological exchange with allies and trusted partners, promote greater multilateral cooperation on mutually agreed export control.
According to the letter, these proposals can be implemented by the Executive Branch under existing statutory authorities. “Security and competitiveness go hand in hand,” said National Association of Manufacturers President and CEO John Engler, “The international marketplace is changing rapidly with new competitors emerging in both developed and transitioning economies. We need a modern export control system that recognizes this new environment and enables U.S. companies to compete and continue their technological leadership.” Said Engler.
The current system regulating the export of defense and “dual-use” items (i.e., those with both civil and military application) is administered by the U.S. Departments of State and Commerce, respectively, but often involves other federal agencies. The Commerce Department processes more than 18,000 authorizations per year. The State Department processes more than 65,000 licenses each year, a figure that has been increasing about 8 percent annually. Some cases take months to process, causing a detrimental impact on allies, trading partners, and exporters in general. Last year, the State Department had a 10,000-case backlog that is still being whittled down. Among the coalition’s recommendations to improve the current system, while maintaining effective controls on sensitive items, are hiring additional licensing and agreements officers to ease processing delays and developing new types of authorizations for exports.
