Categories  Export Control

U.S. Deputy Secretary of Energy Daniel Poneman details efforts to reform export controls

“When American troops in Afghanistan needed replacement monitors to guide tanks through the desert, U.S. export laws made the transaction impossible.
The monitors had been manufactured and were sitting in the U.S. ready to ship, but export laws required the old monitors be returned before new ones could be sent – an impossible task, given that the screens serve as a soldier’s eyes from inside the tank.”
This is one of several anecdotes U.S. Deputy Secretary of Energy Daniel Poneman shared with an audience of about 90 business leaders from across the state at an export forum in Nashua on Tuesday.

Poneman, an export adviser under the George H.W. Bush and Clinton administrations, was invited to talk about the current reforms to America’s export control system, an effort to make it easier for businesses in New Hampshire and beyond to gain new customers through international trade.

Poneman said current export controls were designed for the Cold War era, a fact that has troubled him for some 20 years. The laws are “arcane and user-unfriendly,” he said.

The U.S. government has three separate primary licensing agencies for exports, each with their own procedures and different definitions of the same terms. There are two enforcement agencies that are “overlapping and duplicative,” Poneman said. “Navigating this maze is a tall order, even for large companies that have a strong Washington presence,” he said. “I can only imagine that it’s nearly impossible for medium and small businesses.” “One thing we can do to create jobs is to get out of our own way.”

Companies like Elbit Systems of America, an aerospace and defense company with a facility in Merrimack that employs 500, face problems such as having to get a new license every time it wants to ship a replacement part, according to Shaheen, who introduced Poneman. Other companies face processing delays and confusing paperwork requirements that make it difficult to sell to international markets, she said.

Shaheen’s office organized the event in response to an export forum in Manchester this past spring where business leaders identified export controls as their No. 1 concern.

New Hampshire companies exported $3 billion worth of goods last year, and the state is on track to exceed that number this year. By August, exports were up 40 percent over last year, according to Shaheen – the fifth largest growth in the country.
However, little of that is going to small businesses, which only claim 1 percent of exports nationwide.

Poneman said export reforms requested by President Barack Obama will streamline the control list, consolidate the enforcement agencies, develop a single government IT system for exports and consolidate the licensing agencies.
Only the final phase, consolidating the licensing agencies, will require a vote by Congress. Work has already begun on the initial phases.

The hope, according to Poneman, is that “we will no longer be dedicating the same amount of scrutiny to the brake pads as we do the M1A1 tanks.”

Companies represented ranged from giants like BAE Systems, a global defense and aerospace company with a large presence in Nashua, to small companies like Hampton-based Sleepnet, which employs 23 making masks to treat sleep apnea. Sleepnet President Mary Getty said she’s concerned not only about exports, but the barriers to doing business with the U.S. government. Sleepnet is the only one of its competitors building products from parts made in the U.S., but its competitors are getting all the business from the Veterans Administration, Getty said. “We don’t have deep pockets. We can’t take out an ad in the Wall Street Journal,” she said. “We just want to be on equal footing with big employers.

ASHLEY SMITH Nashua New Hampshire Telegraph

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