Business groups urge export control reforms

WASHINGTON (Reuters) - A coalition of U.S. aerospace, electronics and other manufacturers called for an overhaul of U.S. export controls designed to keep sensitive technology out of the wrong hands, blaming them for delays and lost business.

"We strongly believe that export control modernization is needed and that the opportunity is now," the Aerospace Industries Association and seven other industry groups said in a letter on Tuesday to President George W. Bush.

They complained that the approval process for exporting defense and dual-use technology, which has both military and civilian applications, is plagued by delays that led to a backlog of 10,000 cases at the State Department last year.

"We must continue to protect our sensitive military technologies from our adversaries and rivals, while also maximizing the benefits of trade and technology cooperation with our allies and friends," the letter said.

The groups asked for a meeting with Bush to enlist his support for 19 administrative reforms they said would make the system more efficient, predictable and transparent.

The Commerce Department last year processed 18,941 export license applications for about $36 billion worth of dual-use goods, or roughly 10 percent of total U.S. high-technology exports. The State Department, which approves export licenses for arms and other defense goods, handles over 65,000 application per year, industry officials said.

LOST BUSINESS

Many of the controlled items are readily available from other suppliers, leading to lost U.S. exports because of the difficulty foreigners have in obtaining the goods from the United States, industry officials said.

Chris Padilla, assistant secretary of Commerce for export administration, said he welcomed the groups' suggestions.

"We look forward to reviewing all of the proposals in greater detail and working with the coalition in the future," Padilla said in a statement.

The groups said they hope to win reforms before Bush leaves office in early 2009, because once a new occupant is in the White House they will have to start their push over again.

The coalition's recommendations include hiring additional licensing and agreement officers, developing new types of export authorizations and other steps to reduce the amount of time it takes to get approval.

"We measure modern technology in nanoseconds, but it often takes two months or more to complete this regulatory process," said Charles Robinson, interim president of the Electronics Industries Alliance, in a statement.

The groups said that revamping export controls to open up foreign business opportunities would help the United States maintain its technological leadership, thereby enhancing U.S. national security and competitiveness.

"We need to improve our export control system to reflect the global nature of innovation and security and to enable American businesses to remain competitive in the world economy," Rhett Dawson, president of the Information Technology Industry Council, said in a statement.