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12 April 2000

US Department of State
International Information Programs

Washington File


12 April 2000

State Dept.'s Holum on Multilateral Export Controls

     (U.S. continues pressing for stronger regime, he says) (2560)

     John Holum, the State Department's senior adviser for arms control,
     says that the United States continues pressing to strengthen the
     Wassenaar Arrangement multilateral regime for controlling exports of
     advanced technology and conventional armaments.

     In April 12 testimony before the Senate Governmental Affairs
     Committee, Holum said the United States wants more disclosure by
     Wassenaar members about the exports they approve.

     Now a Wassenaar member discloses a decision undercutting another
     member's denial of an export license only for the most-sensitive
     items. Holum said the United States wants the undercutting provision
     applied more broadly.

     He said the United States also wants Wassenaar agreements on
     controlling portable surface-to-air missiles.

     The Wassenaar Arrangement succeeded the much more powerful Cold
     War-era Coordinating Committee for Multilateral Export Controls
     (COCOM). Holum said the annual Wassenaar meeting in December
     demonstrated that the 33 members are converging more on ways to make
     the regime more responsible, transparent and accountable.

     "This is a noteworthy achievement after just four years," he said.
     "Nonetheless, significant national differences remain, both in
     substance and procedure, that will require patient persuasion and
     diplomacy to resolve."

     He said the best way for the United States to achieve its
     export-control objectives is in multilateral regimes such as

     The United States must realize that it cannot regain the veto of other
     countries' proposed exports as it had under COCOM.

     "Our allies simply would not agree to it," he said.
     Following are terms and abbreviations used in the text:

     -- COCOM: Coordinating Committee for Multilateral Export Controls.

     -- dual-use goods: goods with both civilian and military applications.

     -- WA: Wassenaar Arrangement.

     -- WMD: weapons of mass destruction.

     -- Australia Group: multilateral export-control regime for chemical
     and biological weapons.

     Following is the text of Holum's testimony as submitted for the
     committee's record:

     (begin text) 

     Statement of John D. Holum
     Senior Adviser for Arms Control and
     International Security
     Department of State
     Before the Senate Governmental Affairs Committee

     Wassenaar Arrangement and the Future of Multilateral Export Controls

     The Department of State appreciates this opportunity to discuss the
     Wassenaar Arrangement and the future of multilateral export controls.
     I am encouraged by congressional interest in this important subject,
     and look forward to working closely with the Committee on this and
     other multilateral export control issues. I would like to begin my
     testimony by describing the Wassenaar Arrangement, then discussing
     Wassenaar's strengths and weaknesses.

     It is important to note at the outset that Wassenaar is not, and
     cannot be, COCOM. COCOM, and other multilateral control mechanisms
     faced a clearly defined, mutually agreed strategic threat, and
     addressed that threat by embargoing exports of arms and sensitive dual
     use items to proscribed destinations. Along with our allies, we agreed
     upon procedures for controlling exports to these destinations,
     including allowing for any nation to veto a specific export.

     The end of the Cold War, the disintegration of the Soviet Union, moves
     toward democracy and market-based economies in the former Warsaw Pact,
     deep cuts in the strategic arsenals of both sides, and the goal of
     assisting economic and political reform in East Europe, Russia and the
     other newly independent states -- rather than retarding their economic
     development -- all led our allies to the view that the COCOM,
     arrangement had outlived its strategic rationale and could not be
     sustained. The U.S. eventually joined this view when it became clear
     that our trading partners would no longer agree to follow the
     procedures outlined in the COCOM arrangement. In the waning days of
     COCOM, the U.S. sought to preserve the controls for as long as
     possible, and pushed to establish a new worldwide arrangement to cover
     conventional arms and related technologies. It was only through U.S.
     leadership that we were able to stem the flow of arms and sensitive
     technologies to places such as Iran, Iraq, North Korea and Libya,
     destinations largely ignored by the former COCOM.

     The world has changed for the better. Many of the targets of COCOM now
     are members of Wassenaar, as well as trading partners, friends, and in
     some cases treaty allies.

     Our former COCOM partners recognize that responsible national export
     controls and policies remained indispensable to promote international
     peace and security in the post-Cold War environment, even though they
     opposed, and continue to oppose, any COCOM-like control regime.
     Despite this broad agreement, it was only through persistent and
     strong U.S. leadership that COCOM members, eventually with
     participation by Russia, designed a new multilateral export control
     regime to address the new challenges posed by regional instability and
     states whose behavior threatened international security.

     That new regime is the Wassenaar Arrangement (WA) -- the first global,
     multilateral arrangement covering both conventional weapons and
     sensitive dual-use goods and technologies. It was negotiated and
     established in the mid-1990s at the same time that COCOM was
     disbanded, when it became apparent that the Cold War's East-West
     export controls no longer were appropriate. However, Iraq's buildup of
     arms before the Gulf War demonstrated the need for some form of global
     export regime and the Wassenaar Arrangement responded to this
     challenge by covering more than just dual-use items, as had been
     COCOM's focus. The Wassenaar Arrangement received final approval by 33
     co-founding countries in July 1996, and began operations in September

     The WA is designed to prevent destabilizing accumulations of arms and
     dual-use goods and technologies. The Arrangement encourages
     transparency, responsibility, consultation and, where appropriate,
     national policies of restraint. In doing so, the WA fosters
     accountability in transfers of arms and dual use goods and
     technologies. The Arrangement also provides a venue in which
     governments can consider collectively the implications of various
     transfers on their international and regional security interests. It
     also seeks to enhance cooperation to prevent dangerous transfers.

     WA members maintain export controls on items covered by the Wassenaar
     Munitions and Dual Use lists. These lists regularly are reviewed by
     experts of the Participating States and revised as needed. However,
     the decision to transfer or deny any controlled item remains the
     responsibility of individual member states. There are not, as there
     were in COCOM, case-by-case prior reviews of proposed exports to
     proscribed destinations, or vetoes on proposed exports. To facilitate,
     meeting the WA'S principal objective of preventing destabilizing
     accumulations, members report on their decisions to transfer or deny
     to non-members certain classes of weapons and dual-use technologies.
     Again unlike COCOM, Wassenaar members are not constrained to honor
     each other's denials, but consultations are encouraged in such cases.

     In order to enhance transparency in arms transfers, Wassenaar members
     report semiannually on their deliveries to non-members of seven
     weapons categories derived from the UN Register of Conventional Arms.
     These categories are Battle Tanks, Armored Combat Vehicles, Large
     Calibre Artillery Systems, Combat Aircraft, Attack Helicopters,
     Warships, and Missiles and Missile Launchers.

     In order to promote transparency and like-mindedness, Wassenaar
     members also report on their transfers to non-members of dual use
     goods. The Wassenaar List of Dual Use Goods and Technologies consists
     of a Basic List of controlled items, on which members semiannually
     report aggregated license denials. The Basic List is subdivided into a
     Sensitive List of technologies on which members report individual
     denials of licenses within 30-60 days. In addition to these individual
     denials, members also report semiannually aggregated numbers of
     licenses issued or transfers made. Finally, the Sensitive List is
     further subdivided into a Very Sensitive List, consisting of
     technology subject to extreme vigilance in national licensing

     Although no country is an explicit target of the WA, members are
     committed to dealing firmly with states whose behavior is a cause for
     serious concern. There is broad agreement that these states presently
     are Iran, Iraq, Libya and North Korea. Wassenaar members deal with
     these "countries of concern" by preventing, through shared national
     policies of restraint, their acquisition of armaments and sensitive
     dual use goods and technologies for military end-use.

     Wassenaar provides for the first tine a global mechanism for
     controlling transfers of conventional armaments, and a forum in which
     governments can examine and debate the implications of various
     transfers on their international and regional security interests. It
     also calls attention to potentially destabilizing accumulations of
     weapons, and to situations that may call for concerted actions.

     The United States works actively within this unique forum to advance
     our national interests. Wassenaar has addressed such topics as the
     conflict in Sudan, North Korea's weapons production programs, Iran's
     conventional arms procurement objectives, arms flows to areas of
     conflict in Africa, and the situation in Kosovo. At the December 1996
     Plenary meeting, members issued a public statement confirming that
     they do not transfer arms or ammunition to Afghanistan. In 1997,
     members reiterated the need to exercise maximum restraint when
     considering licenses for the export of sensitive items to destinations
     where the risks are judged greatest. This statement was refined in
     1998 to include regions in conflict. In 1999 members discussed Small
     Arms/Light Weapons and the possibility of developing common export
     guidelines for man-portable Surface-to-Air missiles (MANPADS). They
     agreed to a modest increase in arms transparency, and reaffirmed their
     policies of "maximum restraint" regarding arms exports to areas of

     Wassenaar is more than just a forum for discussion. The United States
     has helped establish and maintain Wassenaar's control lists, has
     benefited from sharing data on arms and technology transfers, and has
     gained insight into the policies and positions of other members. It
     has also served to promote and reinforce strong norms of responsible
     export behavior, which over time has encouraged restraint.

     As head of the U.S. delegation to the 1999 Wassenaar Plenary meeting,
     I am well aware that the Arrangement falls short of U.S. goals in some
     important areas. We would like to see more transparency in both arms
     and duel use transfers, more targeted information sharing, more
     discussion of common problems and possible solutions, as well as some
     form of a no-undercut provision for dual use denials. We would like to
     get agreement on guidelines for MANPADS transfers, controls on
     brokering, and possibly an arms transfer code of conduct.

     These are ambitious, but attainable, goals. I observed at the Plenary
     that national views increasingly are converging around the ideas of
     responsibility, transparency and accountability. This is a noteworthy
     achievement after just four years. Nonetheless, significant national
     differences remain, both in substance and procedure, that that will
     require patient persuasion and diplomacy to resolve.

     We are well aware of the strong advantages to a veto-type arrangement
     but it is critical to recognize that we will never be able to impose
     one unilaterally. Our allies simply would not agree to it.
     Additionally, a veto-style arrangement could actually harm U.S.
     exporters by increasing dramatically license processing times by
     requiring coordination with as many as 33 countries, ceding to those
     outside the regimes the ability to respond in a more timely manner. It
     is also important to recognize that in many fields, the U.S. is the
     leader technologically; we do not believe that it would be
     advantageous to delegate to other countries whose industries are not
     as advanced as the U.S. the right to determine which sales can and
     cannot be made.

     The Future of Wassenaar

     As you prepare for your upcoming travel to Europe. I would recommend
     looking to the future, rather than the past. Wassenaar is a product of
     the post-Cold War period, and faces a dramatically different security
     environment than institutions developed during that period.

     In the new global economy we must lead by example. I believe we have
     made solid steps in this direction, and that a consensus is emerging
     among Wassenaar partners that reflects their commitment to responsible
     transfers. This commitment already is implemented in the national
     policies of Wassenaar partners, and ultimately is what unites us. The
     most effective way to achieve U.S. objectives is to continue to act
     collectively to assess the risks, and to coordinate policies.

     The Wassenaar Arrangement provides a unique venue for the evaluation,
     coordination and cooperation that can yield a safer, more peaceful
     international environment. We will continue to make a concerted effort
     in this forum to foster greater like-mindedness as we examine
     sensitive transfers, assess the risks, and determine appropriate
     responses at the national level.

     The Future of Multilateral Export Controls

     While arms and sensitive dual-use technology transfers to State
     sponsors of terrorism have dropped dramatically since the beginning of
     the decade, we must continue our work to constrain the ability of
     these countries to develop weapons of mass destruction and advanced
     conventional weapons. Recognizing that the spread of weapons of mass
     destruction and sophisticated conventional arms is the most important
     security threat in the post-Cold War world, the role of the
     multilateral nonproliferation regimes has now shifted to focus on the
     behavior of programs of proliferation concern and the entities that
     supply and procure for them, rather than targeting particular
     recipient countries.

     Our export control system for the post-Cold War world responds to
     these new security threats. We have emphasized broadening
     international adherence to our non-proliferation and export control
     goals. Especially since 1991, significant strides have been made in
     strengthening the contributions of export controls to nuclear
     nonproliferation. Moreover, memberships in both the Zangger Committee
     and the Nuclear Suppliers Group together now include all of the
     significant nuclear supplier states and almost all relevant suppliers
     are members of the other regimes. Increasingly, countries that had
     been contributing to the proliferation problem -- such as Argentina,
     Brazil and South Africa -- are becoming part of the solution.

     With the backing of Congress, we have been able to assist former
     Warsaw Pact countries with weak border controls and weaker legislation
     to bolster their resources and to resist commercial incentives to
     trade in sensitive dual-use items, arms, and components of WMD. Our
     overall approach has been to:

     -- Reduce the demand for dangerous weapons and technologies through
     support for international non-proliferation norms and through
     strategies to reduce regional instability;

     -- Pursue a multilateral approach to achieving our nonproliferation
     goals through the Missile Technology Control Regime (MTCR), the
     Australia Group (AG), and the Nuclear Suppliers Group (NSG);

     -- Implement and further strengthen the Wassenaar Arrangement (WA),
     and use the WA to promote responsible transfers of arms, sensitive
     duel-use goods, and related technology, and require transparency in
     such transfers;

     -- Work with key suppliers, transshipment centers, and intermediaries
     that are not members of the nonproliferation regimes to adopt export
     policies and practices compatible with international standards,
     thereby increasing the number of countries, as described in the draft
     EAA, "whose policies and activities are consistent with the
     objectives" of the regimes; and

     -- Retain the ability to impose unilateral controls in those limited
     and extreme circumstances that may require them.

     We also continue the effort to reduce demand for dangerous weapons
     through regional diplomacy -- as in the North Korea, the Middle East
     and South Asia -- to respond to the underlying sources of stability
     and insecurity.

     I would like to thank the Committee for the opportunity to address
     this timely topic. Any form of export control requires difficult and
     delicate compromises. Multilateral export controls multiply these
     difficulties, but also multiply the rewards. The fact that so many
     countries participate in these regimes, and try to improve them, says
     that the rewards outweigh the difficulties. I look forward to working
     further with you on this important subject.

     (end text)

     (Distributed by the Office of International Information Programs, U.S.
     Department of State. Web site:


See also Reinsch's April 4 testimony on reauthorization of the Export Administration Act:

12 April 2000

Commerce's Reinsch on Multilateral Export Controls

     (U.S. needs to build export-control consensus, he says) (1020)

     Under Secretary of Commerce William Reinsch says that the United
     States must approach consensus on export-control policy itself before
     it can exert more influence on other countries' policies.

     "The recent legislative debate revealed the differences among us are
     wide," Reinsch said, "and these differences do not provide a firm
     basis for U.S. leadership at this time."

     Reinsch made the comment in April 12 testimony before the Senate
     Governmental Affairs Committee.

     The main subject of Reinsch's testimony was the Wassenaar Arrangement,
     the 33-member regime for controlling exports of advanced technology
     and conventional armaments to rogue states and areas of instability.
     It succeeded the much more powerful Coordinating Committee for
     Multilateral Export Controls (COCOM).

     He told the committee to forget about suggestions for reviving COCOM
     or its forceful provision that allowed any member to block another's
     proposed export.

     "COCOM was a valuable tool for NATO in the Cold War," he said, "but it
     is gone and cannot be resurrected."

     Reinsch said the United States must recognize that it cannot persuade
     most other Wassenaar members to follow a number of unilateral U.S.
     export controls and trade sanctions.

     He said the United States should instead try to pursue more
     initiatives in areas of agreement with other Wassenaar members.

     For example, the United States proposes that other governments use
     broad authority to block any exports to destinations designated as
     posing a weapons proliferation threat even if the export items are not
     specifically prohibited in any control list. The United States itself
     uses such a "catch-all" provision.

     Reinsch said the United States must reduce the number of items subject
     to export controls, concentrating on those that are controllable and
     critical to advanced military capabilities.

     "This adjustment would put us in a better position to seek foreign
     cooperation with our national licensing decisions," he said.

     Reinsch also said the export-control community should continue
     pressing China to join Wassenaar and the other multilateral regimes
     that aim to prevent proliferation of weapons of mass destruction.

     Following is an excerpt from Reinsch's testimony as submitted for the
     committee's record:

     (begin text) 

     Where Do We Go Next

     The Wassenaar Arrangement has a strong record of success in bringing
     new parties to observe the international norms of export controls and
     nonproliferation and in reducing sales of arms to dangerous places.
     Wassenaar provides the structure that could let us address the export
     control issues that have proved the most troubling over the past
     several years. I would like to conclude by listing a few issues and
     actions which the U.S. could consider as we move ahead in this
     difficult area.

     First, we need to recognize that much of the debate in the United
     States over export controls is out of sync with the rest of the
     industrialized world. This reflects in part larger differences over
     security policies, threat perceptions or transatlantic cooperation,
     but it forms a crucial backdrop to improving multilateral controls.
     But I hope we all agree that unless controls are multilateral they
     will have, except in a very few cases, questionable benefit for
     national security while putting our economic strength at risk.

     Second, we need to continue to consult with our allies and with other
     regime members on the scope for cooperation in improving controls. For
     conventional arms and related dual-use equipment, it may be less than
     we would wish. In particular, we must bear in mind that others will
     not adopt our sanctions policies. Related to that, we should continue
     our efforts to promote adoption of "catch-all" controls by our regime
     partners in order to ensure that adequate authority exists for
     controlling a wide range of technology to specific end users of

     Third, in the context of Wassenaar, we need to refocus the list of
     dual-use controlled items on those that are controllable and critical
     to advanced military capabilities. The globalization of technology
     poses new challenges for U.S. security and limits the utility of
     export controls. Both the Wassenaar Arrangement and our own national
     export controls need to be adjusted in light of this, and this
     adjustment would put us in a better position to seek foreign
     cooperation with our national licensing decisions. We need to do a
     better job reconciling our domestic and multilateral controls.

     Fourth, we need to give up the myth of COCOM [Coordinating Committee
     for Multilateral Export Controls]. COCOM was a valuable tool for NATO
     in the Cold War, but it is gone and cannot be resurrected.

     Fifth, we need to continue efforts to get China to participate in
     multilateral regimes such as Wassenaar. To do this, China will need to
     make progress in adhering to the international norms for
     nonproliferation and arms sales.

     We must continue our efforts to encourage non-members to adhere to
     regime standards. The Department of Commerce, working closely with the
     State Department, has worked with the countries of the former Soviet
     Union and Warsaw Pact to develop comprehensive and effective export
     control systems. We have often found that even in cases where these
     governments are willing to take hard steps to keep items out of the
     hands of unreliable parties, they do not have the practical means or
     legal basis to do so. We have had some success encouraging them to
     take all the necessary steps, including adopting the control lists of
     the multilateral regimes, to allow them to adhere to the objectives of
     the regimes, but more needs to be done.

     Finally, we need to continue to work towards a national consensus, or
     as close as we can get to consensus, in our own national discussions
     over export controls. The recent legislative debate revealed the
     differences among us are wide, and these differences do not provide a
     firm basis for U.S. leadership at this time.

     The Wassenaar Arrangement is good place to start this effort and a
     good place to test our chances for success. If we can make the
     Wassenaar Arrangement work better, we will enhance both national and
     international security.

     (end excerpt)

     (Distributed by the Office of International Information Programs, U.S.
     Department of State. Web site: