USIS Washington File

24 May 2000

Text: State Department Press Release on Defense Trade Initiative

(Reflects major adjustment to Defense Export Control System) (580)

The new Defense Trade Security Initiative (DTSI) represents "the first
major post-Cold War adjustment to the U.S. Defense Export Control
system," according to the Department of State.

Each year the United States authorizes more than $20 billion in
"responsible commercial defense trade," and "we are taking significant
steps to speed up processing of munitions export approvals to benefit
all trading partners," the Department of State said in a press release
issued May 24.

Following is the text of the press release:

(begin text)

Press Release
May 24, 2000

Department of State
Office of the Spokesman

Defense Trade Security Initiative (DTSI)

Secretary Albright will announce the Defense Trade Security Initiative
at the NAC (North Atlantic Council) Ministerial in Florence, which
represents the first major post-Cold War adjustment to the U.S.
Defense Export Control system. The U.S. authorizes over $20 billion in
responsible commercial defense trade each year and we are taking
significant steps to speed up processing of munitions export approvals
to benefit all trading partners. The initiative improves the
efficiency and competition in defense markets, while maintaining the
necessary export controls to safeguard our mutual security.

To enhance security, the U.S. is prepared to establish new ITAR
(International Traffic in Arms Regulations) licensing exemptions for
unclassified defense items, data and services for qualified firms in
allied countries with which we sign a bilateral agreement and that
adopt and demonstrate export controls and technology security system
that are comparable in effectiveness to those of the United States.
These new ITAR licensing exemptions cover unclassified exports to
foreign governments and companies who are identified as reliable by
the U.S. government in consultation with foreign governments.

We will establish this new approach with Treaty allies that meet U.S.
requirements for commonality and reciprocity in exports and industrial
security; long-standing and successful cooperation in intelligence
sharing and law enforcement; and guaranteed reciprocal market access.
Among allied countries, the U.S. will initiate negotiations first with
the UK and Australia, given our long history of cooperation in a
number of relevant security areas, their compatible control and
technology security systems and their significant industrial linkages
with the U.S.

Also included in the initiative are special reforms, available to NATO
Allies, Japan and Australia, that work to streamline the U.S. Defense
Export Control licensing process and forge closer industrial linkages
between U.S. and allied defense suppliers.

The U.S. Defense Trade Security Initiative (DTSI) is designed to
support NATO's Defense Capabilities Initiative (DCI) that was launched
at the Washington Summit last year by NATO Heads of State and
Governments to ensure that the Alliance has conventional military
forces designed and equipped for 21st Century missions.

The reform includes a range of flexible, new licensing vehicles, which
will be established for NATO country governments, Japan and Australia
to allow "one stop" streamlined licensing instead of the multiple
licenses now required for government programs and commercial sales to
foreign governments, international cooperative programs, and
commercial ventures.

The U.S. goal is to make significant steps toward maintaining
interoperability within the NATO alliance during a period of rapid
defense industrial consolidation. The U.S. is committed to maintaining
a strong and robust transatlantic defense industrial base that can
provide innovative and affordable products needed to meet treaty
allies defense needs for the 21st Century and beyond.

(end text)

(Distributed by the Office of International Information Programs, U.S.
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