"I want to tell you that your fact sheet on the [Missile Technology Control Regime] is very well done and useful for me when I have to speak on MTCR issues."
House Seeks to Limit Space Cooperation with China
May 1998
By Howard Diamond
With President Bill Clinton preparing for a late-June summit in China with President Jiang Zemin, the House of Representatives on May 22 passed a series of amendments that would cut off peaceful U.S. space cooperation with Beijing. The explosion of political interest in U.S. satellite exports to China, which motivated the House action, threatens the administration's strategy of leveraging improvement in Beijing's missile proliferation behavior with commercial incentives. Washington has been trying to persuade China to end its sales of missile components and technology controlled by the Missile Technology Control Regime (MTCR) by offering Beijing additional opportunities to launch U.S. satellites.
Amid consideration of the fiscal year (FY) 1999 National Defense Authorization Act, the House overwhelmingly adopted four amendments relating to the satellite issue. The first, a non-binding resolution offered by National Security Committee Chairman Floyd Spence (R-SC), urged the administration to freeze U.S. space cooperation with China and to not use space cooperation as an incentive for changing China's proliferation practices. The other three amendments, introduced by Representatives Duncan Hunter (R-CA), Douglas Bereuter (R-NE) and Joel Hefley (R-CO), would, respectively, forbid U.S. commercial satellite exports to China, prohibit U.S. citizens from participating in technical reviews of failed Chinese satellite launches, and preclude all U.S. exports of MTCR-controlled technology to China.
The House action came in the wake of a flurry of news reports alleging first, that China may be gaining militarily valuable information simply from launching U.S. commercial satellites; second, that two U.S. satellite makers may have made an unauthorized transfer of technical information during a review of a Chinese launch failure; and third, that the Clinton administration's policy on the satellite issue may have been influenced by six-figure campaign contributions by U.S. satellite firms, and possibly even by a Chinese military-owned aerospace conglomerate. Adding to the furor around the satellite launch issue is President Clinton's 1996 decision to classify commercial communications satellites as dual-use items rather than munitions list items. The change in classification was urged by the U.S. satellite industry, and shifted primary export control responsibility from the State Department to the Commerce Department.
Currently, space cooperation between the United States and China is limited by sanctions passed by Congress after the 1989 Tiananmen Square massacre. Each launch of a U.S. satellite on a Chinese rocket must be cleared with a presidential waiver. The Bush administration issued nine such waivers in three years; the Clinton administration has granted 11 in five years. U.S. officials have argued that space launch opportunities have been a key incentive in getting China to control its missile technology exports. To avoid U.S. sanctions imposed in August 1993, China pledged in October 1994 to abide by the guidelines of the MTCR. Created in 1987, the MTCR is an international suppliers regime that controls missiles capable of delivering a 500-kilogram payload 300 kilometers or more, as well as their associated components and technologies.
How well China has lived up to its October 1994 commitment is in dispute, however, and the debate has contributed to the current controversy over satellite exports. U.S. officials agree that since making its pledge, China has not sold "Category I" MTCR items, such as complete ground-to-ground missiles or major sub-systems like engines or guidance systems. But Beijing has reportedly continued to transfer components and technology—"Category II" items—controlled by the MTCR's technical annex to both Iran and Pakistan. U.S. laws call for the imposition of sanctions for both Category I and Category II transfers, but the Clinton administration has been hesitant to impose sanctions or use its waiver authority for fear of upsetting what it believes is an improving Chinese proliferation record.
In late-March, acting Undersecretary of State John Holum and Assistant Deputy Secretary of State Robert Einhorn traveled to China to see if a deal on the missile proliferation issue could be reached in time for the June summit. The terms of Holum and Einhorn's package were laid out in a National Security Council memo that was leaked to The Washington Times. In exchange for full adoption of the MTCR's controls over missile technology and a complete ban on all forms of missile cooperation with Iran, the administration was prepared to issue a blanket waiver of the Tiananmen sanctions on satellite launches and increase the quota of U.S. satellites that could be launched by China. Each satellite launch can be worth between $40 million and $100 million.
China refused the administration's offer, according to a U.S. official, because of the continued political value of its missile trade and a long-standing objection to suppliers cartels like the MTCR. The official said Beijing also protested that the United States sells both ballistic missiles and long range fighter-bombers to countries it wishes to, but wants to end similar Chinese sales under the rubric of non-proliferation. Other U.S. officials, including Secretary of State Madeleine Albright, have raised the missile proliferation issue in their pre-summit dialogues with Beijing, however, no agreement or statement on the issue is expected to come from the June presidential meeting. Clinton is expected to raise the missile proliferation issue during his meetings with Jiang.