[Weekly Compilation of Presidential Documents Volume 35, Number 26 (Monday, July 5, 1999)]
[Pages 1247-1248]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Statement on Export Controls on High-Performance Computers and 
Semiconductors

July 1, 1999

    Today I am announcing reforms to the administration's export 
controls on high-performance computers (HPC) and semiconductors. These 
policies will strengthen America's high-tech competitiveness, while 
maintaining controls that are needed to maintain our national security.
    These reforms are needed because of the extraordinarily rapid rate 
of technological change in the computer industry. The number-crunching 
ability of a supercomputer that once filled a room and cost millions of 
dollars is now available in an inexpensive desktop computer. Computers 
that are widely used by businesses and can be manufactured by European, 
Japanese, and Asian companies will soon exceed the limits that I 
established on high-performance computers in 1996. These business 
computers have become commodities, and next year U.S. and foreign 
vendors are expected to sell 5 million of them.
    Maintaining these controls would hurt U.S. exports without 
benefiting our national security. Moreover, a strong, vibrant high-tech 
industry is in America's national security interests. That is why I have 
decided to raise the licensing threshold of high-performance computers 
to so-called ``Tier 2'' and ``Tier 3'' countries. For ``Tier 3'' 
countries, which present the greatest risk from a national 
security viewpoint, the administration will continue its policy of 
maintaining a lower threshold for military end-users than civilian end-
users. I have also directed my national security and economic advisers 
to provide me with recommendations to update our export controls every 6 
months.
    Due to legislation passed by the Congress in 1997, this change will 
require congressional approval and a 6-month period before it can go 
into effect. I will work with the Congress to pass legislation that 
would reduce this period to one month, so that we

[[Page 1248]]

can keep up with the rapid pace of technological change. I also want to 
work with the Congress on a bipartisan basis to explore longer term 
solutions to how we deal with commodities like widely available 
computers and microprocessors.