LEXIS-NEXIS® Academic Universe-Document

LEXIS-NEXIS® Academic

July 2, 1999 Friday, Final Chaser

SECTION: FRONT; Pg. A5

LENGTH: 349 words

HEADLINE: PROPOSAL WOULD EASE LIMITS ON COMPUTER SALES TO CHINA

BYLINE: By Peter G. Gosselin, Los Angeles Times

DATELINE: WASHINGTON

BODY:
Despite controversy over China's alleged theft of American nuclear weapons designs and other high-tech secrets, the Clinton administration on Thursday proposed easing limits on U.S. computer sales to China and other politically sensitive nations.

Senior administration officials strongly hinted that further easing is on the way, possibly including a complete abandonment of an especially tight limit on sales to China's military. The current limit requires companies to get permission before selling anything more powerful than a souped-up desktop computer to the Chinese military. The new limit would allow sales of substantial business computer systems without government approval. Administration officials portrayed their decision as partly a bow to the reality that powerful machines are readily available for purchase around the world, thus making U.S. export restrictions no longer effective, and partly a rousing defense of the U.S. computer industry.

"With no change to current controls, we estimate that the U.S. could lose nearly $4 billion in sales over the next four years," White House Chief of Staff John Podesta said in unveiling the proposal. "That would weaken our computer industry, it would weaken our economy, and it would do so without any benefit to our national security."

Key congressional Republicans gave the White House plan a surprisingly warm welcome, given the recent GOP-led investigation of alleged Chinese spying at U.S. weapons labs and misappropriation of American technology.

A congressional aide said the battle likely will come not over the looser limits themselves but over how quickly the administration puts them into effect.

Under current law, Congress has six months to decide whether to accept or reject the most stringent of the limits. The White House and the computer industry said that the new rules need to be in place within a month.

The new proposal represents the third time that the Clinton administration has sought to loosen export limits since 1993. Both the Reagan and Bush administrations also loosened some limits.

LOAD-DATE: July 6, 1999