China Suspends Military Exchanges With U.S.

Here is a bit of news that might calm the PRC leadership's "anger" (here) over the US planned arms sales to the ROC. The Sino-US military relations will likely return to "normal" in six months when the current theatrical-work ends.(here)

U.S. May Lift Export Controls for Some Warfare Items (Update1)
January 28, 2010, 06:28 PM EST
http://www.businessweek.com/news/2010-01-28/u-s-may-lift-export-controls-for-some-goods-with-military-uses.html

By Mark Drajem

Jan. 28 (Bloomberg) -- The U.S. may remove restrictions on exports of goods with potential military applications when such technologies are already available worldwide, Commerce Secretary Gary Locke said.

Existing rules are intended to keep dual-use technologies such as computer encryption software and aerospace parts out of the hands of U.S. adversaries that could use the products for military purposes. The Obama administration is looking at how to reduce the burden on exporters, Locke said today.

“We have too many controls on items readily available around the world,” Locke told a meeting of the U.S.-China Business Council in Washington. “For us to restrict companies from sending those around the world, does it hurt us?”

The rules may have cut exports by as much as $100 billion, according to an estimate from the National Association of Manufacturers. Allowing the sale of products that are already manufactured in other nations would help U.S. makers of software, machine tools and basic encryption technology, Catherine Robinson, associate director for trade at the Washington-based industry group, said in an interview.

At a meeting with Obama administration officials yesterday, the discussion was about how to “control less and control it better,” Representative Brad Sherman, a California Democrat and member of the House Foreign Affairs Committee, said in an interview. “You have a present system that is bad for national security, bad for jobs and bad for our industrial base.”

The US-China Business Council is a nonprofit organization of about 220 U.S. companies that do business with China, according to its Web site.

Officials from the Obama administration briefed lawmakers yesterday on the review of the export-control rules, Locke said.

“We need to have some commonsense reorientation,” he said.

--With reporting by Hans Nichols in Washington. Editors: Romaine Bostick, Joe Richter.

To contact the reporters on this story: Mark Drajem in Washington at +1-202-624-1964 or mdrajem@bloomberg.net.

To contact the editor responsible for this story: Larry Liebert at +1-202-624-1936 or lliebert@bloomberg.net.