By Amulya Nagaraj: Subscribe to Amulya's RSS feed
September 1, 2010 9:33 AM EDT
In a bid to tighten national security, U.S. President Barack Obama announced a restructuring of export control policies that would prune one-third of the items in the current control list.
In a speech at the Commerce Department's annual conference, Obama said the current control system is "overly complicated, contains too many redundancies, and, in trying to protect too much, diminishes our ability to focus our efforts on the most critical national security priorities."
The government will restructure the control lists into a single, cohesive "positive list" and said it may decontrol about one third of the total Munitions list, which contains articles, technology and services related to defense.
A preliminary analysis conducted by technical experts states that about 74 percent of the 12,000 items licensed last year in the Munitions List category will be moved the Commerce Control List or will be decontrolled altogether, the government said in a statement.
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"Of 26 percent of items that remain on the Munitions list, none were found to be in the highest tier of control, about 18 percent are in the middle tier and the remaining 8 percent in the lowest tier," the government said.
A new "Export Enforcement Coordination Center" will be established to help with enforcing these lists. The U.S. government will also transition to a single information technology system to administer to export control systems by the next year.
This will open up immense export possibilities for companies that export defense materials, technology or aerospace-related goods.
Boeing's CEO Jim McNerney, who also serves as the chairman of the President's Export Council (PEC) advising Obama on international trade, said the plane-maker supports the initiative as "an important step toward strengthening and streamlining our export control policies, making them more effective in protecting our national security and advancing U.S. competitiveness."
The PEC, which consists of 20 members from companies in the private-sector such as Xerox, Walt Disney, is responsible to advise the President on ways to enhance U.S. competitiveness and support job growth in the next five years.
""The restructured list shows great promise in assigning the appropriate level of protection to technology exports across all levels of risk," Aerospace Industries Association CEO Marion Blakey said in a statement, adding that it could have a 'dramatic' impact on small and mid-sized companies.
However, the latest reform suggestion has drawn fire from several quarters on concerns that it could actually impede national security, as it potentially lowers barriers to sensitive technology. Easier licensing policies could mean regions and people who were previously not allowed to access certain technologies will be given free access.
Under the new proposals, only the highest tier items will require a license to all destinations. However, sanctions against specific countries like Iran and Cuba will still continue to be in place, the government said.
The government intends to begin issuing proposed revisions to the control lists and licensing policies later this year.
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