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Close NATO’s "Capability Gap" With Transatlantic Partnership
As printed in Aviation Week & Space Technology Deputy Secretary of Defense Rudy de Leon, As printed in Aviation Week & Space Technology , Monday, June 26, 2000

A year after the NATO air campaign against Yugoslavia, among the greatest challenges facing the alliance is to ensure that the forces that prevailed in the Balkans last spring remain prepared to prevail in future campaigns. This is precisely why last year's Washington Summit launched a major initiative to improve NATO defense capabilities. However, a year later, disparities in military capabilities across the alliance remain troubling. There are steps the alliance should take to address these shortcomings.

First, America's allies need to invest more in defense. No one suggests strict parity of spending or equal military capability. However, realizing improvements in alliance capabilities -- as well as the European Union's goal of deploying a force of 50,000-60,000 by 2003 -- requires that every NATO member use existing resources more wisely and devote more resources to defense.

Second, there needs to be greater transatlantic defense industrial cooperation. A U.S. more open to European business, and a Europe more open to American business, means more competition and cooperation, which means more innovation and more capable and interoperable systems for our uniformed forces. Quite simply, we need more and stronger links between more companies, competing in markets on both sides of the Atlantic.

Third, the U.S. must change its system for sharing technology. For a number of years, there has been growing concern on this side of the Atlantic about an emergence of a ''Fortress Europe,'' only to realize that U.S. export controls support a ''Fortress America'' mentality. The U.S. has long pressed our NATO allies to improve their defense capabilities, only to find that our export control system has made that difficult.

For these and other reasons, the U.S. recently unveiled the first major reform to our export controls since the Cold War. The Defense Trade Security Initiative is designed to increase sharing of technologies with our allies, enhance the effectiveness of our export control system and encourage allies to do the same.

The most significant reform is the proposal to simplify the process for trade of unclassified defense items with our allies. As we have for Canada, we are proposing to negotiate International Traffic in Arms Regulations (ITAR) exemptions from selected export rules. As with Canada, we will have to negotiate with each country to ensure that their export controls and technology security practices are as effective as those of the U.S. Companies in such countries will have to be reliable as well, with their own good records of security.

Under our proposal, we would complete a government-to-government agreement allowing us to extend a broad exemption from the ITAR. Most unclassified defense projects between two reliable companies would then no longer require a license.

By removing a number of licensing requirements, we hope to share more technology with and from our allies while simultaneously making export controls more effective. The recent U.S.-U.K. Declaration of Principles is a road map for this kind of cooperation, and we will soon complete a similar road map with Australia. We look forward to beginning negotiations with both nations on an agreement allowing an exemption from ITAR. Through these measures, we hope to create a strong incentive for other countries to strengthen their export controls so we can enter into similar arrangements and share similar benefits.

We want to make it easier for American and foreign companies to work together in the development and production of defense articles. Several types of new umbrella licenses therefore will enable entire projects to be covered under single licenses that would be valid for extended periods.

Our initiative also includes reforms to shorten the review of procurements related to the Defense Capabilities Initiative. Still other reforms are designed to improve how this new system will work day-to-day. The Defense Department will increase our licensing staff by 50%, devote more resources and computerize our processes to expedite the review process even more.

The final way we can increase alliance military capabilities and industrial cooperation requires the commitment and cooperation of our partners in allied governments and in industry. Security practices have largely been strong, but need to be even stronger. We need our allies and industrial partners to commit the resources to properly administer this system.

In short, we are committed to closing the ''capability gap'' with our allies, widening and maintaining the ''technology gap'' with adversaries and helping U.S. and European industry to form more cooperative ventures.

The ability of NATO forces to operate as partners remains tied to a cooperative, rational and viable transatlantic defense industrial base. We cannot maintain a strong alliance if we have a weak defense industrial base. The reforms to our export control system will deliver a robust industrial base, strong forces, and by extension, a secure alliance.

As adapted from Deputy Secretary de Leon’s June 4, 2000 address to the Workshop on NATO Political-Military Decision-Making in Berlin, Germany, available on DefenseLINK at