COCOM’s Coming Moment Of Truth

Next week, the leading industrial democracies will gather in Paris to hold what may be one of the most important meetings in the history of the Coordinating Committee on Multilateral Export Controls, a group known best by the acronym COCOM. At this High Level Meeting (HLM), senior representatives of the United States government — Under Secretary of Commerce Dennis Kloske, Under Secretary of State Reginald Bartholomew and Under Secretary of Defense Paul Wolfowitz — will be buffeted by intense allied pressure to weaken, if not effectively to dismantle, the existing multilateral arrangements for denying Warsaw Pact nations militarily relevant technologies.

This pressure will manifest itself in two generic ways: First, the meeting will focus on micro level issues, where greater latitude will be sought to sell more sophisticated and, therefore more strategically significant, technologies. Second, the HLM will be a forum for considering the burgeoning macro level problem — the growing sentiment among many allies that export controls must be dispensed with in the interest of helping reforming communist countries resuscitate their dying economies.

Starting with a senior interagency meeting tomorrow, the U.S. government will begin mapping out its approach to these micro and macro problems for the HLM. It is no overstatement to say that the West’s future security posture will be profoundly affected by the outcome of these American deliberations.

An Example of the Micro Problem: Machine Tools

As the Center described in its recent paper entitled Trading Places: NATO May Lose Technological Edge to Warsaw Pact as Commerce Decontrols Key Technologies,(1) COCOM and member nations are currently considering decontrolling the transfer to the Soviet bloc of a plethora of sophisticated technology. One of the most strategically significant of these proposed actions would involve extremely accurate machine tools.

Machine tools are essentially machines that cut and shape metals and other materials; they are used primarily to make other machines and equipment. Such tools are used in the manufacture of everything from staplers to computers to tanks. The more accurate their capability, the greater the applicability to the precision manufacture involved in production of modern armaments, notably military aircraft.

For this reason, current COCOM controls proscribe the sale to the USSR and its allies of machine tools with accuracies greater than plus-or-minus 10 microns (or four ten-thousandths of an inch).

While over 95% of the United States’ defense industrial base utilizes tools at or inferior to the ten micron level of precision, Western state-of-the-art machine tools are capable of even greater accuracy. The fact that West German and other allied manufacturers are now able to produce machines tools with accuracies better than plus-or-minus 3 microns has prompted some to argue that the present export control standard is too stringent.

In judging the appropriate standard, however, the relevant test should not be the state of the art of Western machine tools and like technologies. Instead, the right question is: What is the likely impact on Soviet military capabilities of providing greater access to strategically significant technology that, while perhaps inferior to the best available in the West, is still vastly superior to that currently possessed by the USSR and its allies?

The Olivetti Case

Ironically, as the debate intensifies over the appropriate controls on the export of machine tools, fresh evidence has just become public concerning the direct military use being made by the USSR of accurate systems illegally acquired from the Italian firm, Olivetti. In an extremely serious breach of the existing COCOM standard, Olivetti evidently started selling the Soviets sophisticated machine tools in 1984. It is reported that the Soviet Union has, among other things, utilized Olivetti-supplied machine tools to fabricate its new YAK-41 supersonic, short-take-off-and-landing naval fighter aircraft.

The Olivetti case vividly illustrates a key point: The Soviet Union’s needs are such that Moscow is prepared to go to great lengths to acquire machine tools of the quality some wish to decontrol. What is more, where the Soviets are successful in doing so, they are employing such systems for military purposes — hardly surprising given that the precision capability inherent in these sophisticated machines is not required by most commercial or civil applications.

Unfortunately, there is considerable evidence that Olivetti is not the only Western manufacturer of machine tools to have transferred strategically significant equipment to the Soviet bloc. In fact, during a tour of four allied capitals last week, a senior team of U.S. officials briefed other COCOM member governments about American concerns on this score.

The Correct Response on Machine Tools

What is clearly needed at this juncture is not the legalization of such technology flows — whose effect would simply be to permit the Soviet military industrial base to be efficiently retooled. Rather, what the West should do at this juncture is to undertake to enforce the present COCOM standards.

Thanks to an earlier scandal involving the illegal sale to the Soviet Union of strategically significant machine tools, the President has the authority to impose severe sanctions against companies that violate multilateral export controls. In 1988, after the Toshiba Machine Company transferred such tools to the USSR enabling the Soviet navy to fabricate vastly improved submarine propellers, Congress enacted legislation that would both prohibit imports into the United States of products manufactured by companies violating COCOM rules and bar such firms from awards of U.S. government contracts.

At the Paris HLM, the American delegation should make it clear that, unless individual countries begin enforcing the existing COCOM controls, the United States will have no choice but to impose sanctions on their companies engaged in such breaches of Western security.

It is to be expected, however, that Washington will be urged to trade a relaxation of the export control standard on machine tools for promises of greater allied efforts on enforcement. Were the United States to buy into this gambit, the result would almost certainly be that even larger quantities of ever more capable manufacturing technology will find their way into the hands of the Eastern bloc’s defense establishments. Given the strategic value of high precision machine tools (i.e., those capable of plus-or-minus 3-5 micron accuracies) to the Soviet military industries and given the poor performance of a number of allied countries in enforcing the present standard, Western security would be greatly disserved by U.S. acquiescence in this ruse.

In light of the recent, scandalous repetition by Olivetti of Toshiba’s earlier subordination of the West’s collective security interests to the desire for corporate profit, the United States should not have to haggle with its allies to obtain commitments to improved enforcement of existing export controls. Moreover, unless and until the prospective recipients of advanced machine tools cease to be part of a military organization and intelligence apparatus inimical to Western security interests, no liberalization of the plus-or-minus ten micron standard can be justified.

The Macro Issue: Liberalized COCOM Treatment for Poland and Hungary

The last point is relevant to the larger problem the U.S. delegation will face at next week’s High Level Meeting in Paris. Many allied governments are inclined to exploit the widely shared desire to aid the process of reform in Poland and Hungary to dismantle multilateral export control arrangements under which such Western governments and their businesses have chafed for years.

Consequently, incredible though it may sound, the United States is being told that the process of economic resuscitation in the Eastern bloc requires a massive infusion of strategically sensitive technologies and, therefore, the easing of COCOM restrictions. American officials are asked to disregard the fact that these technologies are, by and large, vastly more sophisticated than is required for the commercial purposes most urgently required by the Polish, Hungarian and Soviet economies. As the spokesman at the West German embassy in Washington recently put it, "In an age where — via dialogue and cooperation — we try to assist reform processes in Poland, Hungary and the USSR, COCOM is outdated."(2)

There are several serious problems with this logic. First, should the West chose to sell an array of militarily critical, dual-use technologies to those Soviet bloc nations seen to be committed to reform, it may actually make the process of economic reform more difficult. Neither Poland nor Hungary has adequate hard currency holdings to meet basic national requirements. Deutschmarks, yen and dollars spent to procure sophisticated equipment like high precision machine tools is hard currency not available to buy technology appropriate to meeting the highest economic priority — satisfying domestic consumer demands.

Second, those who hope this obstacle to the sale of strategic technologies can be mitigated by offering such countries financing for these transactions should think again. Neither of the communist nations experimenting with reforms can be said to be a sound credit risk. The only prospect for getting a return on such Western investments of high technology might be if they are guaranteed by the respective countries of origin. Even then, it is simply a matter of time before the taxpayer burden associated with the cumulative impact of shouldering these and other Eastern bloc liabilities is seen as unsupportable by U.S. and allied electorates.

Finally, irrespective of the dubious economic benefit of selling controlled technology — for either liberalizing nations of the East or their would be benefactors in the West — there is one surpassing reason not to differentiate Poland and Hungary from Soviet bloc COCOM controls: Poland and Hungary remain part and parcel of an alliance structure and intelligence network that pose direct threats to the security of the Western allies.

Like it or not, there is simply no way to ensure that strategic technology made available to Poland and Hungary will not be put to the service of the Warsaw Pact and the KGB-dominated intelligence apparatus in place throughout the Soviet empire. In addition to technology sharing arrangements that flow from security ties, both Poland and Hungary are signatories of CMEA 2000, a high technology cooperation agreement that envisions codevelopment, coproduction and other collaboration in dual-use and other technologies.

Neither formal agreements nor periodic on-site inspections will prevent the diversion and utilization of machine tools and other dual-use equipment where it suits the purposes of the USSR. In fact, historically, these countries have proven to be excellent conduits for Soviet acquisitions of Western high technology; there is no reason to believe that those responsible for the internal security and defense portfolios in Poland and Hungary will refrain from performing this damaging role in the future if given an opportunity to do so by COCOM.


Far from having outlived its usefulness, the Coordinating Committee on Multilateral Export Controls has perhaps entered into the most important era of its forty year history. Now, as never before, the West’s ability to maintain its decisive competitive advantage in high technology over the massive military forces of the Warsaw Pact may increasingly depend on the effectiveness of COCOM’s efforts to control strategic technology flows to the East.

With the widely perceived abeyance of the Soviet threat, nearly every Western democracy has chosen to slacken the pace with which it pursues defense research and development. Accordingly, the task of preserving the qualitative edge that has historically offset Soviet quantitative strengths will require multilateral discipline and rigorous controls on the export of dual-use technology.

In such an environment, it is absolutely imperative that the U.S. delegation to COCOM’s High Level Meeting next week be instructed to reject the calls from allied capitals for ill-advised liberalization of controls on machine tools and similar, highly sensitive technologies. Under no circumstances should the United States accede to demands that improvements in allied enforcement of multilateral export controls be contingent upon further relaxation of such technology restrictions.

American representatives should similarly be directed to insist that no consideration be given to creating special exceptions or preferential treatment by COCOM for Soviet bloc nations that remain within the Warsaw Pact and the framework of corresponding Eastern bloc intelligence arrangements.

Some will argue that the United States must accommodate its allies, dispensing with bits and pieces of the COCOM list or proscribed destinations to stave off pressure to dismantle the entire multilateral export control regime. In fact, such an approach will condemn COCOM to death by a thousand cuts. It would invite endless assaults on the controlled technologies list and make a mockery of efforts to enforce those limitations that remain.

Only by holding firmly to a prudent, responsible course on both the micro and the macro levels — including, if necessary, by asserting an intention to employ sanctions against companies breaching existing COCOM guidelines — can the United States hope to preserve this organization. Only by standing up for effective and enforced multilateral export controls can this country and its allies continue to obtain the benefits COCOM has provided to date in terms of reduced Western defense costs and increased pressure for domestic reform within the Soviet bloc.

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1. Publication 89-55, released on 18 September 1989.

2. Remark by Hans-Henning Horstmann, as quoted by Clyde H. Farnsworth in "A Debate on Controls of Exports," New York Times, 9 October 1989.

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