[FPSPACE] China to End Missile Part Exports

[Dan Barkley]

For American companies, the immediate effect will be the unfreezing of
licence applications to launch American satellites on Chinese rockets.

							-NY Times


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	China to Stop Selling A-Arms Delivery Systems
			By JANE PERLEZ
			   NY Times

WASHINGTON, Nov. 21  The Clinton administration and China said today that
China had pledged to stop selling missile parts or the equipment needed
for missile production to countries developing nuclear weapons.

In exchange, Washington agreed to waive economic sanctions for past sales
of such matriel to Iran and Pakistan, the State Department said. This will
allow American companies to apply again for licenses to launch satellites
on Chinese rockets.

The agreement would help bring China into line with international
standards restricting missile-related exports, officials said. They said
that step, like membership in the World Trade Organization, would push
China to be more responsible.

But in announcing the accord, which President Clinton and President Jiang
Zemin reviewed at their meeting last week in Brunei, officials cautioned
that China's pledges have yet to be enacted. "This looks good on paper,"
said one senior official involved in the talks. "What we'll have to watch
is implementation," a job for the next administration.

The most promising aspect of the accord, officials said, was China's
commitment to adopt an export-control list under which Beijing would
require Chinese companies to get licenses to export "equipment, materials
and technology that can be directly used in missiles, as well as
missile-related dual-use items."

But the Chinese failed to specify what penalty companies would suffer if
they exported without licenses.

It was also unclear how thoroughly the export-control list would be in
compliance with the Missile Technology Control Regime. That agreement,
which restricts sales of specific missiles and missile parts, was signed
by 32 countries, but not China.

China's continued export of missile production facilities to Pakistan has
been of particular concern in Washington since the nuclear tests by
Pakistan and India in 1998.

The issue complicated White House efforts to win Senate passage of a bill
this year granting China permanent normal trade relations, especially
after American intelligence agencies reported that China exported a few
dozen long-range missiles to Pakistan in 1992 and sent missile production
facilities in the 1990's. Among the items China sent to Pakistan after the
1998 nuclear tests were specialty steels and guidance systems.

The announcement today, in effect, confirms those Chinese exports, which
under American law required sanctions. The administration said today that
while technically it was imposing the sanctions, it was waiving them in
view of the new pledges.

For American companies, the immediate effect will be the unfreezing of
licence applications to launch American satellites on Chinese rockets.
Applications were frozen in February because of concerns that Chinese
aerospace companies were exporting missile-related materials to Pakistan
and Iran.

Many American companies, from cellular telephone networks to international
television conglomerates, are waiting in line for satellites to be sent
into orbit, and China has expressed eagerness to offer low-cost services.

Two American companies at the forefront of satellite launches in China,
Hughes Space and Communications International and Loral Space and
Communications, will not be affected by the waiving of sanctions,
officials said, because they are under investigation to determine whether
they improperly advised the Chinese on rocket design in the mid-1990's
without obtaining licenses. The companies have denied any wrongdoing, but
officials said they would not be allowed to apply for licenses until the
cases are resolved.