301. Briefing Memorandum From the Assistant Secretary of State for
East Asian and Pacific Affairs (Holbrooke) to Secretary of State Vance1
Technology Transfers and Military Sales to China
Harold intends to raise this issue at tomorrow’s VBB lunch. The attached paper embodies the recommendations
of the EA “informal group.”2 In toto the steps
proposed may suggest substantial adjustments in our policy toward China.
In fact, however, these steps essentially implement decisions already
adopted.
1. Munitions Control List. While this list (Tab A)
looks long, it excludes 13 of the 19 categories on the Munitions Control
List, and merely identifies those categories and parts of categories
from which we will consider items for licensing on a case-by-case
basis.3
2. Chinese Requests. Our proposed response to
outstanding Chinese requests is outlined in Tab A, Encl. 2.4 The Defense
Department’s office of Research and Engineering and the Joint Staff have
reviewed the list with an eye to possible adverse consequences to our
security and that of our Asian friends and allies. Their willingness to
approve further discussion of various items reflects a variety of
considerations. Some (e.g. Honeywell Level 66 Computers) have previously
been sold to the
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USSR. Others (e.g. 100 MB disk driver or LTN–51 INS) contain
technology we have already sold to the PRC for civilian purposes. In still other cases (e.g.
IR sensors) sales would be subject
to strict conditions—e.g. early generation systems only.
3. U.S. Export Control Categories. This is a
purely cosmetic change, but one which is symbolically important to
Beijing and fully consistent with other adjustments in our trade
relationship with China.
4. Dual Use Technology and COCOM. While we have informed our COCOM partners of our preference for a
procedure patterned along the lines of the Polish formula, we have not
formally tabled a proposal. It is time that we do so. This will surprise
no one and we think our allies will buy this approach.
5. Arms Sales, Military Equipment Sales and COCOM. Bureaucratic simplicity
and allied solidarity incline us to favor handling sales of all items
destined for military end-use in COCOM. To be sure, the creation of a separate high level
committee to handle such items might enable us to avoid taking a
position on the record on third country arms sales. But having indicated
our own intent to sell military support equipment to China, it is
difficult for us to argue that our allies should respond to our requests
within COCOM while requiring them to
seek our views on arms sales outside the existing framework. In any
event we would be participants in whatever consultative process was
established, and the Russians have probably assumed we have been urging
our allies to sell weapons to China whatever we say. (COCOM was, of course, established to
restrict, not promote sales.)
6. The Package as a Whole. There is a larger
policy question: How should we play these decisions in relation to our
current efforts to orchestrate a coordinated allied response to Soviet
action in Afghanistan? Announcement of these measures at this time could
invite some charges—e.g. from Europeans—that we are acting in a hasty
fashion to stick it to the Russians. While such allegations will
undoubtedly surface, we believe they are manageable because they are
wide of the mark.
—In fact these steps are not that new; they represent essentially a
codification of decisions already announced at least in general terms.
To that extent they have already been discounted by Moscow and others.
Beijing expects them; failure to follow through would be hard to explain
to the Chinese who may, however, be disappointed that we have not been
more forthcoming.
—They do not get us out ahead of our allies, who will welcome a clearer
definition of our intentions regarding military equipment sales to China
and our agreement to handle arms sales within COCOM. Cer
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tainly
we should consult further with the allies on these steps prior to any
public announcements.5
—Congressional sensitivities must also be accommodated through prior
consultations.
—We should emphasize in backgrounders to the press that we will continue
to process requests carefully on a case-by-case basis.
Tab A
Memorandum From the Deputy Assistant Secretary of
Defense for International Security Affairs (Platt), the Assistant Secretary
of State for East Asian and Pacific Affairs (Holbrooke), and Roger Sullivan of the National
Security Council Staff to Secretary of Defense Brown, Secretary of State
Vance, and the
President’s Assistant for National Security Affairs (Brzezinski)6
Washington, February 26, 1980
SUBJECT
- Technology Transfers and Military Equipment Sales to
China
1. Sale of Military Equipment to China
We must provide U.S. industry with further guidance on the sale of
military equipment to China. For domestic purposes we prefer to do
this in terms of categories of the Munitions Control List, which
conforms to existing laws and regulations, is familiar to U.S. and
foreign industry, and can be understood as a comprehensive and
definitive statement of our policy. The announcement could be made
through the Munitions Control Newsletter. A proposed announcement,
which includes only those categories which are consistent with our
policy of not selling arms to China, is at Enclosure 1. Specific
items will be subject to a case-by-case review.
Recommendation. That you approve the approach
outlined above and the announcement at Enclosure 1.
2. Chinese Requests
During Secretary Brown’s
visit, the Chinese provided him, through his representative Dr.
Dinneen, a list of items
which they
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wished to
purchase. It was implied that these items would be for military
use.
We have reviewed this list using two criteria: (1) the level of
technology and (b) consistency with our policy of sale of support
equipment but not weapons. Enclosure 2 represents our analysis and
identifies items which we are prepared to discuss further, items
which require further clarification by the Chinese before we are
willing to engage in technical discussions with them, and items
which we are not prepared to discuss further.
Recommendation. That you authorize us to
respond to the Chinese list along the lines shown in Enclosure 2.
This would be in addition to informing them of our policy on
military equipment sales as outlined in the proposed announcement in
the Munitions Control Newsletter (Enclosure 1).
3. U.S. Export Control Categories for
China
In the regulations implementing the U.S. Export Administration Act,
China is included in Category Y along with Albania, the USSR, and the other Warsaw Pact
countries except Romania, Hungary, and Poland. Inclusion of China in
Category Y with the Soviet Union is an unnecessary irritant in our
relations with China. Changing the name of the category would not
affect our policy on exports to China or any other country. Nor
would it directly affect COCOM
since this category is used only within the USG.
Recommendation. That the Department of
Commerce be instructed to revise its regulations issued pursuant to
the Export Administration Act to provide a separate category for
China.
4. Dual-Use Technology and COCOM
We have held political discussions with our principal COCOM partners and informed them
that we wish to establish exception procedures for the transfer of
technology to China which are similar to those that nominally exist
for Poland. While there is some disagreement with the French on the
adoption of a formal procedure versus an informal one, our other
major COCOM partners are amenable
to proposals to treat exceptions for dual-use export licenses to the
PRC more favorably than for the
Warsaw Pact. We believe that in the end the French will go along
with a formal procedure.
Recommendation. That we instruct our
delegation to COCOM to propose a
formal procedure along the lines of the Polish formula.
5. Arms Sales, Military Equipment Sales and
COCOM
Our allies have repeatedly pressed us to change our policy on the
handling of third country arms sales, because of the extreme
difficulty of justifying COCOM
controls on non-weapons if there are no apparent
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controls on weapons sales. Our
recent decision to approve sales of military support equipment to
China, which we have already told our COCOM partners will be submitted to COCOM for review, makes our present
policy of keeping weapons sales out of COCOM seem even less logical. In the long term,
allowing the most important decisions on allied exports to China to
be undertaken outside of COCOM
seriously undercuts the rationale for the organization and could
tempt COCOM members to circumvent
the organization on major non-weapons sales to the Soviet Union as
well as to China.
There are basically two options:
—Option A: Create a special committee within COCOM to handle sales for military
end use to include arms, military equipment and dual-use
technology.
—Option B: Handle all sales of arms and equipment—whether for
military or civilian end use—through the existing COCOM framework.
We believe that Option B now represents the best approach. This is a
change from our recommendation in 1978. It would respond to strong
representations of our allies that the COCOM members judge all sales, whether for military or
civilian end use, by the same standards. The existing COCOM structure is designed to deal
with all categories of technology—dual-use, weapons and military
equipment, and nuclear. Using it would avoid the complication and
consequent confusion that establishment of an additional
consultative mechanism would entail. This option would promote
allied unity and would clearly strengthen COCOM at a time when we are trying to tighten controls
on the USSR.
Recommendation. That you approve Option
B.
6. Consultations
We will have to consult with appropriate members of Congress
concerning our guidelines for military equipment sales before they
are published. Moreover, Congress would have to be informed of our
intended changes to the implementing regulations of the Export
Administration Act to provide a separate category under the Act for
China. We do not anticipate any significant opposition from the
Congress providing consultation is broad and undertaken sufficiently
in advance of announcements.
