No Easy Choice--NATO Collaboration and the U.S. Arms Export Control Issue

To delineate the extent of the conflict between the U.S. desire for increased NATO collaboration to standardize weapons and the need to maintain control over weapons systems made from U.S. technology, GAO analyzed the trading patterns of the major producers and did case studies of ongoing collaborative weapons projects at the production and development stage; assessed the competitiveness of European producers who get a license to produce U.S. systems to determine if they would be willing to accept restrictive U.S. export controls; and reviewed the handling of third country sales in new co-development programs.

GAO found major differences in the customers considered acceptable by the different producers, particularly between the United States and France, which explains French reluctance to accept U.S. restrictions in collaborative projects. Because of smaller quantitative requirements and less efficient production practices, the United Kingdom, France, and the Federal Republic of Germany cannot compete with the United States in markets. This accounts for their reluctance to adopt U.S. systems, and this limits the potential for NATO collaboration using dual production. U.S. controls for the sake of cooperation are diminishing with the largest concessions extracted where the potential standardization benefits and European contributions are the greatest. To reach aggreements, the United States has modified its sales policy for the sake of collaboration. Despite the importance of these policy decisions, congressional participation is limited because authorization legislation covering arms exports is not designed to deal with the new forms of collaboration. These decisions may require a departure from U.S. sales policy and set rules governing arms transfers to be made in the next decade or beyond. If arms transfer concessions are to be made for the sake of standardization, the Congress, with its legislative endorsement of both policies, may want to expand its perogatives in establishing where the line on making concessions should be drawn.