Commission to Assess the Ballistic Missile Threat to the United States
Appendix III: Unclassified Working Papers
Richard T. Cupitt 1 : "Export Controls and Missile
Technology Transfers"
The Impact of Export Controls on the Proliferation of Ballistic Missiles
Developing a long-range ballistic missile program has proven more difficult
in practice than simple theoretical arguments about technological
determinism suggest. As Aaron Karp, Brian Chow and others note, few
emerging regional powers can develop long-range missiles without
substantial foreign assistance. 2 Those emerging powers with indigenous
programs, moreover, relied on foreign assistance at first, and they operate
at a technological level below the missile systems available to the United
States and its allies. Even established powers with long-range ballistic
missile programs can benefit from imports of US missile technology.
This process makes export controls on military and dual-use missile
technology a powerful, if controversial, tool in thwarting the
proliferation of ballistic missiles. Based on discussions with officials
involved in missile programs in China, India, Ukraine, and Russia, for
example, multilateral export controls have delayed, prevented access, or
simply increased the cost for a host of missile technologies. As put by one
official with the Chinese Academy of Launch Vehicle Technology, export
controls means that "our lab does not get the US technology we want." 3
Several emerging powers, moreover, have abandoned their ballistic missile
programs altogether, such as the Condor-2 program, at least in part because
of the costs imposed by export controls.
Increasing acceptance of the guidelines for the transfer of missiles and
missile technologies under the Missile Technology Control Regime (MTCR)
continue to improve the prospects for sustained cooperation in restricting
the transfers of missile technology. Governments of twenty-nine major
supplier or transit countries belong to the MTCR, while several others
claim to adhere to the guidelines. As important, MTCR "partners" have
adapted the guidelines to address new concerns, such as the decision in
1993 to extend some controls over missiles capable of delivering chemical
or biological weapons.
The Limited Appeal of the MTCR and Export Controls in East and South Asia
Unfortunately, only a few Asian governments embrace nonproliferation export
controls, while others either tolerate or disdain them. 4 Even though more
governments are adopting nonproliferation export control systems, only a
few states in the region have systems in operation. Even among those, only
the export control systems of Japan and Hong Kong appear highly compatible
with current multilateral standards (see Table I). 5 More important for
assessing the ballistic missile threat to the United States, the least
consensus exists regarding controls on missile technology. Indeed, only
Japan, South Korea, and Hong Kong appear to have the MTCR control list
integrated into their export control regulations (see Table II).
The lack of support for the MTCR in the region does not bode well for US
interests. The People's Republic of China, India, North Korea, Pakistan,
and Taiwan all have significant medium-to-long range ballistic missile or
Space Launch Vehicle programs, while Indonesia and Thailand also have
nascent space programs. 6 In addition to the well-known episodes of North
Korean and Chinese exports of ballistic missiles and missile technology,
Pakistan, India, and China all sought to import items for their ballistic
missile programs during 1996. 7 Other states in the region also have the
capacity to produce and export dual-use items. In 1997, for example, Taiwan
exported (under license) items that appear to fall under either the MTCR
Category II list or under the items controlled unilaterally by the United
States for reasons of missile proliferation (see Table III). Solely based
on an assessment of likely capabilities and current control policies,
ballistic missile proliferation in the region will increase faster than the
current rate into the next century as more countries produce critical
dual-use technology.
Limits on the Appeal of Missile Technology Controls in Asia
If these emerging suppliers of dual-use items do not adopt export controls
compatible with the MTCR, not only will existing ballistic missile programs
benefit, more countries may seek to acquire new ballistic missile
capabilities as critical items become more readily available. MTCR partners
recognized this concern when they made an explicit appeal to non-members to
adopt the aims and guidelines of the MTCR (and include missile
proliferation controls as a topic in regional security institutions) after
the 1997 Tokyo plenary. 8 Since 1996, MTCR partners also supported three
seminars on transshipment, where representatives from Hong Kong, South
Korea, and Singapore among other non-partners attended. During this period,
the United States, arguably the most ardent champion of the MTCR, also
discussed missile proliferation and export controls with China and both
Koreas. The talks with South Korea, in particular, should lead to South
Korea becoming an MTCR partner in the near future. Still, adding new
members to the MTCR, beyond the inherent challenges that poses for
information sharing and decision making in the organization, may reach an
impasse because forces in the region appear to promote interests
antagonistic to the spirit and guidelines of the MTCR.
The recent collapse of several East Asia economies will put more pressure
on firms in the region to export proliferation sensitive items (although it
may constrain state-sponsored missile programs). The move away from
state-ownership in China, already underway, will only exacerbate these
pressures. The military modernization programs and the influx of weapons to
the region also means that most governments already have a greater capacity
to militarize their territorial, social, political, and economic disputes,
including the use of missiles.
Worse, few officials in East Asia see regional or global missile
proliferation as a significant military threat to themselves, although
several have concerns about ballistic missiles in specific dyadic
relationships. 9 The most recent White Paper that covers Chinese
nonproliferation policies, for example, does not mention missile
proliferation as a threat or as a target of Chinese export control
policies. 10 The reports of recent tests of a new Pakistani missile
threatens to pit the subcontinent in an arms race that may result increased
missile technology acquisition efforts by both sides (and stronger pulls on
China and Russia to supply additional missile technology).
Actions by the US government and companies also may have contributed to the
lack of support for the MTCR in the region. Unlike the recent discussions
on nuclear technology, the United States has few credible punishments or
incentives to offer the country of greatest missile proliferation concern,
China. US companies, under license, have exported technology to China that
may have contributed to Chinese missile systems. 11 The United States has
applied missile-related sanctions against Chinese entities on two
occasions, which the President subsequently waived only to see charges of
new exports of missile proliferation concern recur (see Table IV).
Controversy also surrounds decisions not to impose sanctions in other cases
regarding the transfer of missiles and missile technology to Pakistan.
Although China has responded favorably to US (and Israeli) concerns
regarding sales of missiles and missile technology in the Middle East,
China runs a great risk of losing political credibility and an important
strategic ally if it abandons support for the Pakistani missile program
outright. Consequently, strong sanctions by the United States may put the
Chinese in an untenable position, making China even less cooperative on
other missile proliferation issues.
Chinese officials also point to US aircraft sales to Taiwan and promotion
of Theater Missile Defense systems as examples of US willingness to ignore
nonproliferation objectives for short-term foreign (and economic) policy
interests. Chinese officials often suggest that if Japan or Taiwan acquire
a Theater Missile Defense capability in cooperation with the United States,
then China will respond with a massive increase in missile production. As
one official associated with the Chinese military put it, "we know how to
defeat a missile defense system." 12 With a high degree of certainty, such
an increase in production would mean more missiles available for export in
subsequent years.
Factors Favoring Increased Cooperation in Asia
Fortunately, other factors should influence countries in the region,
including China, to come in closer compliance with the MTCR. Most
governments in the region, and many companies, want to build or maintain
their reputation as a responsible "good citizen" in the world community.
Time and again, relevant officials in the region emphasize that responsible
behavior means no support for the proliferation of weapons of mass
destruction.
On a practical level, many enterprises and officials learn about export
controls through their interaction with export control compliance programs
of companies based in MTCR partner countries. Over 900 Japanese companies,
for example, have internal compliance programs that generally include
provisions for continuous training of employees in foreign affiliates about
export controls. As a matter of company policy, this training usually
entails product and end-user screening for missile proliferation items. If
enterprises and national economies become more integrated into the global
marketplace, then they will receive greater exposure to missile
nonproliferation norms and rules, reducing the chance for accidental or
unintended proliferation.
In addition, several countries have witnessed an increase in the number of
scholars and government officials interested in nonproliferation and export
controls. The Chinese nonproliferation community, for example, now includes
a new fifty person Arms Control and Disarmament unit in the Ministry of
Foreign Affairs specifically charged with studying proliferation export
control issues. In the case of Japan, anti-militarism forms an important
part of the political culture and few firms seem willing to risk the
opprobrium associated with proliferation activities. To the extent that a
culture of nonproliferation emerges in the region, the opposition to
intentional as well as accidental acts of missile proliferation should
increase.
Democratization and economic liberalization in the region may increase
identification with the values of the Western security community. 13 The
high correlation between MTCR partnership and membership in the Western
security community suggests that aspiring members increasingly will abstain
from missile proliferation activities the closer they identify with the
MTCR partners on other security matters. The evidence from the cases of
South Korea, Taiwan, and Hong Kong argue in favor of this position, while
the theory helps explain the less than enthusiastic response
nonproliferation export controls receives in Malaysia, Singapore, and
elsewhere. Even the mixed policies of China (with its increasing economic
but not political affinity with the West) and India (one of the few
democratic polities with a state-oriented economy) follow from this
approach. Although this liberal identity perspective remains open to
debate, it seems well equipped to explain adoption of nonproliferation
standards in other regions, especially Latin America and Eastern Europe,
and should apply to Asia.
Conclusion
In the summer of 1995, MTCR partners considered the possibility of creating
a multilateral treaty aimed at halting the proliferation of
intermediate-range ballistic missiles. The resounding opposition put a
preemptive halt to the proposal. Until now the MTCR, with all its
weaknesses, has proven valuable in promoting the norm of missile
nonproliferation and delaying or even rolling back proliferation-sensitive
missile programs. Nonetheless, this can not warrant complacency. While the
MTCR may not need fixing, few of the newly industrialized countries in Asia
have adopted missile nonproliferation export controls. If this condition
persists, several factors may converge to undermine the effectiveness of
the MTCR in the very near future.
Many opportunities, however, also exist to mitigate these pressures for
proliferation in Asia. The bargains that might outline a multilateral
treaty on missile proliferation might extend into other delivery systems,
assistance for commercial space programs, security assurances and other
elements currently outside the debate. Nonetheless, support for the norm of
missile nonproliferation by the United States and its allies in the region,
in terms of both behavior and rhetoric, can overcome the imperatives of
technology diffusion to reduce the rate of proliferation of ballistic
missiles in the next few years. Export controls, at best, buy time. How the
United States and the other MTCR partners will use that time in the next
few years will have a profound impact on the ballistic missile threat
facing the United States in the next century.
Table I
Compatibility of Nonproliferation Export Control Systems,
Early 1997*
Compatibility Scores
(Percent)** Japan South Korea Hong Kong Taiwan China
Unweighted 97 90 87 76 38
Weighted 97 91 92 81 50
* From research supported by the Japan Foundation Center for Global
Partnership, the Japan-United States Friendship Commission, the Chiang
Ching-Kuo Foundation, and the University of Georgia.
Table II
Compatibility with MTCR Guidelines
Status Japan South Hong Taiwan China
Korea Kong
MTCR Member or Claims
Adherent Yes No No* No* Adherence
Guidelines and Lists
Integrated into No (under
National Laws or Yes Yes Yes development) No
Regulations
* The special political status of Hong Kong and Taiwan has hindered their
direct participation in the MTCR.
Table III
Missile Technology Related Items
Exported by Taiwan, 1997
ECCN Description Cases Value (1,000US$)
1A02 Composite Structures or 9 3,641
Laminates
2B01 Numerical Control Units 11 1,209
3A01 Electronic Devices and 806 806,178
Components
4A02 Hybrid Computers 1 48
4A03 Digital Computers 3 31
5A01 Telecommunications items 11 2,020
7A01 Accelerometers 1 2
1004 Bombs, Torpedoes, Rockets,
(Munitions) Missiles 42 3,812
Source: Board of Foreign Trade, Ministry of Economic Affairs, Republic of
China
Table IV
Foreign Entities in East and South Asia Sanctioned by the
US Government for Missile Related Activities, by Country
and Sanction Action*
Country Entity Sanction
China Great Wall Industries
China Group China Precision Machinery Two year restriction imposed
Import-Export Corporation (Also June 1991. Waived March 1992.
see Pakistan June 1991)
Two year restriction imposed
Ministry of Aerospace Industry July 1993. Waived November
1994. Also imposed on any
and ten additional entities government activity related
(Also see Pakistan July 1993) to missile, space systems, or
military aircraft development
or production.
Space and Upper Atmosphere
Pakistan Two year restriction imposed
Research Commission June 1991. Expired.
Ministry of Defense Two year restriction imposed
July 1993. Expired.
Lyongakasan Machineries and Two year restriction imposed
March 1992. Expired. Also
Equipment Export Corporation imposed on any government
North Korea activity related to missile,
Changgwang Credit Corporation space systems, or military
aircraft development or
(Also see Iran March 1992) production.
Lyongakasan Machineries and
Equipment Export Corporation
Two year restriction imposed
Changgwang Credit Corporation June 1992
(Also see Syria June 1992)
Changgwang Singyong Corporation
Two year sanction imposed May
(Also see Iran) 1996.
India Indian Space Research Two year sanction imposed May
Organization 1992. Expired.
Source: Carnegie Endowment for International Peace Nuclear
Non-Proliferation Project.
* This does not include three instances where names and nationalities of
the US government withheld the names and nationalities of the entities from
the public.
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1. Richard Cupitt is the Associate Director for Research and Washington
Liaison, Center for International Trade and Security, University of
Georgia. Has written extensively on international trade, national security,
and multilateral cooperation. Currently evaluating nonproliferation export
controls.
2. See Aaron Karp, Ballistic Missile Proliferation: The Politics and the
Technics, New York: Oxford University Press, SIPRI publication, 1996; or
Brian G. Chow, Emerging National Space Launch Programs: Economics and
Safeguards, Santa Monica: Rand, 1993.
3. Interview, November 1997.
4. Although I limit my remarks to East and South Asia, many of these
concerns apply to the Middle East and the newly independent states of the
former Soviet Union. Much of the information in this report comes from
field research in Hong Kong, Japan, Malaysia, the People's Republic of
China, the Republic of China, and Singapore as well as discussions with
export control officials from Indonesia, the Republic of Korea, Thailand,
and Vietnam conducted over the last four years. Support for this research
has come from the Center for Global Partnership, the Chiang Ching-Kuo
Foundation, Japan-United States Friendship Commission and the Center for
International Trade and Security.
5. For an explanation of the assessment methodology and some Asian
examples, see Richard T. Cupitt, "Nonproliferation Export Controls in
Asia," The Journal of East Asian Affairs, XI, 2 (Fall/Summer 1997), pp.
452-480.
6. For an excellent discussion of missile programs in the region, see David
G. Wiencek, Dangerous Arsenals: Missile Threats In and From Asia, Bailrigg
Memorandum 22, Lancaster, UK: Centre for Defence and International Security
Studies.
7. Director of Central Intelligence, The Acquisition of Technology Relating
to Weapons of Mass Destruction and Advanced Conventional Munitions,
July-December 1996, Biannual Report to Congress, June 1997, pp. 4-5.
8. http://www.sipri.se/projects/armstrade/mtcr_jointappeal.html.
9. South Korea with North Korea, Taipei with Beijing, and India with
Pakistan, for example. The Japanese government, however, has become
increasingly sensitive to the issue of missile proliferation
10. State Council of the People's Republic of China, China: Arms Control
and Disarmament, Beijing: Information Office, November 1995.
11. The Bush and Clinton administrations, for example, approved 11 waivers
of export control restrictions to allow Chinese rockets to launch
satellites with US technology. In a recent case, the Clinton administration
reportedly gave approval to Loral Space and Communications to launch
another satellite, possibly compromising an investigation of Loral and
Hughes Electronics for transferring sensitive missile information in their
assessment of a February 1996 launch of one of their satellites at the
Xichang Satellite Launch Center, see Jeff Gerth and Raymond Bonner,
"Companies Are Investigated for Aid to China on Rockets," The New York
Times, April 4, 1998, pp. 1, 3. Also see United States General Accounting
Office, Export Controls: Some Controls Over Missile Related Technology
Exports To China Are Weak, GAO/NSIAD-95-82, Washington: USGPO, April, 1995;
and United States General Accounting Office, Export Controls: Sensitive
Machine Tool Exports to China, GAO/NSIAD-97-4, Washington: USGPO, November,
1996.
12. Interview, Beijing, March 1995.
13. For a general discussion of this view, see Andrew Moravcsik, "A Liberal
Theory of International Politics," International Organization, 51, 4
(Autumn 1997), pp. 513-553; or Alexander Wendt, "Constructing International
Politics," International Security, 20, 1 (Summer 1996), pp. 71-81.