The export strategy is working, with the United States regaining its position as the world’s largest exporter. While our strong export performance has supported millions of new, export-related jobs, we must export more in the years ahead if we are to further strengthen our trade balance position and raise living standards with high-wage jobs.
Enhanced Export Control.
The United States is a world leader in high technology exports, including satellites, cellular phones, computers, information security, and commercial aircraft. Some of this technology has direct or indirect military applications, or may otherwise be used by states or transnational organizations to threaten our national security. For that reason, the United States government carefully controls high technology exports by placing appropriate restrictions on the sale of goods and technologies that could be used for military purposes or otherwise impair our security. These controls recognize that in an increasingly competitive global economy where there are many non-U.S. suppliers, excessive restrictions will not limit the availability of high technology goods. Rather, they would serve only to make U.S. high technology companies less competitive globally, thus losing market share and becoming less able to produce cutting-edge products for the U.S. military and our allies.
Our current policy recognizes that we must balance a variety of factors. While acting to promote high technology exports by making license decisions more transparent, predictable and timely through a rigorous licensing process administered by the Department of Commerce, we also expanded review of dual-use applications by the Departments of Defense, State and Energy. If any of these agencies disagree with a proposed export, it can put the issue into a dispute resolution process that can ultimately rise to the President. As a result, reviews of dual-use licenses are today more thorough than ever before. In the case of munitions exports, we are committed to a policy of responsible restraint in the transfer of conventional arms and technologies that could contribute to WMD. A key goal in the years ahead is to strengthen worldwide controls in those areas.
Encryption is an example of a specific technology where careful balance is required. Export controls on encryption must be considered as part of an overall policy that balances several important national interests, including promoting secure electronic commerce, protecting privacy rights, supporting public safety and national security interests, and maintaining U.S. industry leadership. Over the past year, the Administration, in consultation with industry and privacy groups, conducted a review of its encryption policy as well as foreign and domestic markets, and announced an updated policy in September 1999. While continuing a balanced approach, the new policy significantly streamlines export controls while protecting critical national security interests. When the new encryption export regulation is published in early 2000, U.S. companies will be afforded new opportunities to sell their encryption products without limits on key length to global businesses, commercial organizations and individuals. Most U.S. mass-market software products, previously limited to 40 and 56 bit keys, will be approved for export to any end user.
Similarly, computers are a technology where we must apply export controls in a manner that addresses our national security concerns and continues to help strengthen America’s competitiveness. In doing so, we face extraordinarily rapid technological changes. Maintaining outdated controls on commodity level computers would hurt U.S. companies without benefiting our national security. Recognizing this, the Administration announced reforms to export controls on computers in July 1999 that permit higher levels of computers to be sold to countries which are friendly to the United States. For countries that present risks from a national security viewpoint, the Administration will continue its policy of maintaining a lower threshold for military end-users than civilian end-users. Export control agencies will review advances in computer technology on an ongoing basis and will provide the President with recommendations to update computer export controls every six months.
U.S. efforts to stem proliferation cannot be effective without the cooperation of other countries. We have strengthened cooperation through the Nuclear Suppliers Group, the Missile Technology Control Regime, the Zangger Committee, the Australia Group for the control of chemical and biological weapons-related related items, and the Wassenaar Arrangement for greater transparency in conventional arms transfers. These efforts enlist the world community in the battle against the proliferation of weapons of mass destruction, advanced conventional weapons and sensitive technologies, while at the same time producing a level playing field for U.S. business by ensuring that our competitors face corresponding export controls.
Providing for Energy Security
The United States depends on oil for about 40 percent of its primary energy needs, and roughly half of our oil needs are met with imports. And although we import less than 15% of the oil exported from the Persian Gulf, our allies in Europe and Japan account for about 80% of those exports. The United States is undergoing a fundamental shift away from reliance on Middle East oil. Venezuela is our number one foreign supplier, and Africa supplies 15% of our imported oil. Canada, Mexico and Venezuela combined supply almost twice as much oil to the United States as the Arab OPEC countries. The Caspian Basin, with potential oil reserves of 160 billion barrels, promises to play an increasingly important role in meeting rising world energy demand in coming decades.
Conservation measures and research leading to greater energy efficiency and alternative fuels are a critical element of the U.S. strategy for energy security. Our research must continue to focus on developing highly energy-efficient buildings, appliances, and transportation and industrial systems, shifting them where possible to alternative or renewable fuels, such as hydrogen, fuel cell technology, ethanol, or methanol from biomass.
Conservation and energy research notwithstanding, the United States will continue to have a vital interest in ensuring access to foreign oil sources. We must continue to be mindful of the need for regional stability and security in key producing areas to ensure our access to, and the free flow of, these resources.
Promoting Sustainable Development
Developing countries face an array of challenges in their efforts to achieve broad-based economic and social progress and participate more fully in the opportunities presented by globalization. Poor environmental and natural resource management can impede sustainable development efforts and promote regional instability. Many nations are struggling to provide jobs, education and other services to their citizens. Three billion people, half the world’s population, subsist on less than two dollars a day. Their continued poverty leads to hunger, malnutrition, economic migration and political unrest. Malaria, AIDS and other epidemics, including some that can spread through environmental damage, threaten to overwhelm the health facilities of developing countries, disrupt societies and economic growth, and spread disease to other parts of the world.