Export Control System Needs Modernization

A quick look at foreign trade figures from 2006 in the aerospace and defense industry reveals some impressive statistics. A total of $85.2 billion in exports fueled an industry trade surplus of $54.8 billion, a lofty figure made even more remarkable when you consider our nation’s overall trade deficit.

But as strong as these numbers are, they could be even more substantial. The US export control system prevents the nation from realizing the full security, technological, and economic benefits of high-technology trade and cooperation with our allies.

AIA has joined with other business advocacy groups to create the Coalition for Security and Competitiveness, which is pursuing a concerted effort to improve how the US export control system operates. In a more and more globalized world, in which the US faces threats from terrorist groups, rogue states, and others, effective export controls remain essential. These controls keep our most advanced technologies, weapons, and equipment out of the hands of our adversaries — an increasingly difficult task. And in an era where transnational threats rank with traditional ones, and new challenges continue to emerge, the cooperation of friends and allies has become even more critical.

If we are to keep the nation secure and advance our interests abroad, building interoperability, trust, and efficient working relationships with our global partners is no longer a luxury, it is a requirement. The United States promotes these partnerships through a number of political, diplomatic, economic, and military means. Defense trade and technology sharing leverages the technological competitiveness and innovation of US industry to build the interoperability, trust, and capacity that are critical to coalition warfare. At the same time, this cooperation strengthens America’s technological edge, sustains the defense industrial base, and enhances our economic security. Technology cooperation gives our warfighters the best weapons and equipment at the best value for the American taxpayer. And by providing access to our trading partners’ markets and innovations, we also sustain American jobs.

Unfortunately, our current export control system does not manage defense trade and technology cooperation in an efficient, predictable, or transparent manner. The system also hampers companies marketing civil or dual-use products in the international marketplace, even though the restricted technologies often have little or no military or intelligence applicability. The aerospace and defense industry is partnering with the executive branch and Congress to develop an export control system that not only keeps sensitive technologies out of the hands of our adversaries, but one that also facilitates trade and cooperation with our allies and partners in both mature and emerging markets.

In the short term, with rigorous oversight and management and adequate resources, our current export control system can be made more efficient, predictable, and transparent. The coalition has suggested a list of improvements the administration can undertake now that can show results relatively quickly. But they require leadership and sustained engagement by the administration working with industry. We have received positive initial reactions from administration officials as they review the suggestions.

Going forward, improvements to the current system alone will not be successful in adequately meeting the security and economic challenges of the 21st century. Therefore, AIA and our partners among industry associations, think tanks, foreign partners/allies, and academic institutions are identifying the critical elements of a modern, effective US export control system that could be enabled through legislative, regulatory, process, and organizational changes. This package of proposals can create a system that will effectively govern the export of aerospace, defense, and dual-use products.

The end result of these improvements would be streamlined defense trade with our closest friends and allies. This would not only increase our national security, but boost trade and create a jump in the high-paying jobs in the aerospace industry. With these clear benefits, we can’t afford not to take these steps forward.