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OCR Page 1 of 5CONFIDENTIAL
CONFIDENTIAL
THE WHITE HOUSE
WASHINGTON
SYSTEM II
90391
NATIONAL SECURITY DECISION
May 21, 1986
DIRECTIVE NUMBER 226
MACHINE TOOLS AND NATIONAL SECURITY
(U)
Statement of Policy
It is the policy of the United States to maintain a broadly based
deterrent against different types of conflict. In this regard,
the U.S defense industrial base is a critical component of
conventional and strategic deterrence. (U)
Section 232 Study
On March 17, 1986, the Secretary of Commerce forwarded a report
on the effect of machine tool imports on the national security
that was prepared under Section 232 of the Trade Expansion Act of
1962, as amended. This study was based on current Administration
national security policy and included analysis developed by an
interagency task force. (U)
The Secretary of Commerce, in consultation with the Secretary of
Defense and other relevant Administration officials, indicated
that the machine tool industry is a small yet vital component of
the U.S. defense base. The Secretary of Commerce further
indicated that high levels of imports can erode U.S. capabilities
to manufacture critical machine tool product lines. (U)
I have reviewed the Secretary of Commerce's report on the impact
of imports of machine tools on the national security and
considered the information on this issue presented at the
National Security Council Meeting. (U)
Based on this information I have decided that the following
course of action shall be implemented:
-
A specific 232 finding will be delayed for six months.
-
In six months time, based on how the U.S. domestic
industry is performing and the nature of imports, a finding will
be made. (U)
-
Voluntary Restraint Agreements will be sought with
Taiwan, West Germany, Japan and Switzerland on machining centers,
numerically controlled (NC) lathes, non-NC lathes, non-NC
punching and shearing, NC punching and shearing, and milling
machines. A breakdown of the levels to be sought through
discussion and consultation with the exporting countries are as
follows (VRA levels are based on the percent of units shipped
vis-a-vis the total U.S. market) :
CONFIDENTIAL
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CONFIDENTIAL
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