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May 24, 2000

Washington Loosens Restrictions on Sales of Weapons to Allies

By CHRISTOPHER MARQUIS

WASHINGTON, May 23 -- Sobered by shortcomings in the NATO alliance in the battle last year for Kosovo, the Clinton administration is overhauling its controls on arms exports to friendly nations for the 
first time since the end of the cold war, American officials said today. 

Secretary of State Madeleine K. Albright is to announce steps in Italy on Wednesday to greatly reduce the red tape involved in the licensing of technology sales, information sharing and joint ventures between governments and contractors within NATO, Japan and Australia, the officials said. 

The American package will increase the number of staff reviewing defense-related licenses by 50 percent and render decisions in as little as 10 days, the officials said. It would facilitate foreign bids on Pentagon programs, ease Americans' contacts with foreign counterparts within the same company, and allow for American exports of entire arms systems under a comprehensive license. 

The measures also would clear the way for trans-Atlantic military mergers, which Western European officials and industrialists have long sought in order to gain access to the lucrative American market. 

The administration's package seeks to lure allies to align their non- proliferation standards with Washington; it designated Britain and Australia, close allies, for licensing exemptions. 

American contractors welcomed the change. They have pressed for greater access to European markets, especially as NATO members ponder substantial new investments. The United States spends $25 billion for military research and development, and Europe spends about one-third as much. 

"Lockheed has been supportive of streamlining licensing procedures and welcomes this step," said Hugh Burns, a spokesman for the Maryland-based defense contractor. 

Pentagon officials said they hoped to foster a more competitive atmosphere in which good ideas transcend borders and percolate up from researchers. One administration official faulted the current procurement regime as "a communistic system where you're doing it from the top down." In Kosovo, United States weapons routinely outperformed European systems. 

Analysts say the shift by the United States reflects a calculation that a stronger alliance outweighs the risk of undercutting nonproliferation efforts.

Copyright 2000 The New York Times Company