The Trump administration is taking aim at another U.S. industry it says it being held back by overregulation and government red tape, moving to reduce federal rules and restrictions governing overseas sales of weapons and armament, in a bid to accelerate American arms deals to a growing international clientele eager to field the latest generation of U.S.-made weaponry.
American arms manufacturers anticipate the policy changes spearheaded by the Trump White House under the so-called “Buy America” initiative will even the playing field with their less regulated foreign competitors and result in billions of dollars in new deals. U.S. diplomats and military attaches will be tasked with talking up U.S. military products as part of a plan still being developed by the administration.
Far more than any of his predecessors, Mr. Trump likes to talk up publicly the quality of the U.S. defense products and the need for foreign militaries to consider buying American, as he did in a bilateral meeting with visiting Norwegian Prime Minister Erna Solberg in the Oval Office on Wednesday. He praised Oslo’s recent order for 40 F-35 fighter jets made by Lockheed Martin.
“We make the greatest military equipment in the world, and you buy a lot of it and we appreciate that,” Mr. Trump said. “It’s called jobs.”
Defense industry officials have publicly and privately chafed at the interagency process governing U.S. weapon exports, a cumbersome effort overseen in equal parts by the Defense Department, State Department and Commerce Department.
Critics say less regulated competitors from China, Russia and Israel have been able to undercut American firms, in both speed of sales and range of products, to global markets. U.S. firms also face stringent federal statutes dictating foreign weapons sales under the International Traffic in Arms Regulations (ITAR).
While the U.S. remains the world’s biggest arms exporter, foreign defense firms in recent years have been able to challenge American dominance in certain military technology sectors, including cyberwarfare and unmanned weapon systems, because they don’t face the same government regulations that confront American weapons makers.
Facing stagnant military budgets at home, leading U.S. defense giants such as Lockheed Martin, Boeing and Raytheon have been forced to look to new markets in Asia and the Middle East.
Overseas weapons sales by U.S. firms surged by $8.3 billion in 2017, with American arms makers moving a total of $41.9 billion in advanced weaponry to foreign militaries last year, according to figures by the Defense Security Cooperation Agency, the Pentagon directorate that oversees such arms deals. That number could have been higher if the deregulation proposals had been in place at the time, the Trump administration and its supporters say.
Aside from pressing for a more expedited federal approval process for U.S. weapons sales, the White House is also calling upon American diplomats overseas to press partner nations to consider new weapons deals with Washington, administration officials told Reuters on Monday. Under the new plan, officials from the Pentagon, State Department and Commerce Department will press ahead with an overhaul of ITAR regulations, in order to facilitate the White House’s new strategy, Reuters reported.
The weapons deregulatory push is widely seen as the White House trying to deliver on Mr. Trump’s campaign promises to re-energize all sectors of the American economy and shrink the U.S. trade deficit. Industry sources tell The Washington Times that U.S. defense firms are bullish the administration’s deregulation initiatives on overseas weapons sales could open the door to sales of weapons technologies to countries who had been barred from buying such capabilities under existing laws and rules.
While White House officials and their agency and industry counterparts continue to hammer out the final details of the “Buy America” initiative, the changes will not be the free-for-all defense industry experts and critics of the plan claim, a State Department official said.
The crux of the initiative will be to streamline the weapons export process and speed up the pace of deals, the source said. Administration officials “want adaptability in the international marketplace [by] … cutting the red tape” associated with U.S. weapons deals overseas.
It’s unlikely the current overhaul will allow defense firms to sell American weapons technologies overseas that are currently banned from export. Washington will continue to “secure critical technologies” while “maintaining America’s military edge” over near-peer competitors such as Russia and China, the source said.
Despite a shrinking domestic market, U.S. defense firms still provide nearly one-third of all military-grade arms and equipment fielded by international forces.
Nearly 100 countries fly, float and fight with American-made weapons systems, with U.S. defense firms market leaders in advanced strike aircraft, precision-guided munitions and missile defense systems. That effort has been spurred on by U.S. defense programs specifically geared toward international consumption — such as the F-35 Joint Strike Fighter program.
With major NATO allies — Britain, Italy, Australia, Canada, Norway, Denmark, the Netherlands and Turkey — involved in the jet fighter’s production, the program has become a template for tying U.S. defense programs into global markets. That approach has filtered down to lower-level programs, such as the Navy’s Tomahawk cruise missile program.
“We are working right now with the U.S. government and the Navy to create an affordable path to enable us to provide [foreign military] sales to our best allies,” Chris Sprinkle, manager of the Raytheon-built cruise missile, said Wednesday.
Company officials went so far as to design the newest version of the weapon to include interchangeable characteristics, allowing foreign militaries to field the weapon with little to no modifications.
“The idea here is … we have put together a missile that we can make it easier for [the U.S.] to sell on an [foreign military sales] capacity” while providing U.S. naval forces the most cutting edge cruise missile technology, Mr. Sprinkle said during a briefing at the Surface Navy Association’s annual symposium in Crystal City, Virginia.
Efforts by U.S. defense industry to appeal more to international markets comes as American defense firms face increasing pressure from China and other economic competitors. Of all foreign nations posing a serious challenge to American dominance in the arms market, Beijing has made the greatest strides.
China boosted its international sales percentages from 3.8 percent of the market from 2007 to 2011, to 6.2 percent of the world market from 2012 to 2016, analysts at the Sweden-based Stockholm International Peace Research Institute. This uptick has firmly secured Beijing’s role as a top-tier supplier of weapons and equipment to international militaries, putting China on par with military defense firms in France and Germany.
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