G7 Nations Open to Expanding Membership for New Export Control Regime, Expert Says

Benson, speaking during an event this week hosted by the Center for Strategic and International Studies, said the G7 -- Canada, France, Germany, Italy, Japan, the U.K. and the U.S. -- should also invite Australia and South Korea. And “there's no reason that we should stop at the G9,” she said, adding that new countries should be welcomed as long as they “get on the same page with other allies” with their export controls, investment screening procedures and other similar economic security rules.

“I think there is a broad recognition among some of our close G7 partners that we need new rules of the road for economic security, and that an expanded G7” is a “really effective way to go about it,” said Benson, director of the CSIS Project on Trade and Technology. “In conversations I've had, this idea has been very well received.”

William Reinsch, the CSIS Scholl Chair in International Business, asked whether turning the G7 into an export control mechanism risked changing its “whole nature and rationale.” But Benson said the G7 is “already heading in a more geopolitical direction,” pointing to the recent Japan presidency, which focused heavily on economic security issues (see 2305220017 and 2305190059).

“Export controls and investment screening featured very prominently, and so did energy security issues, supply chain security issues. There's tremendous momentum,” Benson said. “It just needs a secretariat, and it needs to have more durability so that we have a more agile institution that’s suited for today.”

The U.S., however, may need more time to assess how best to replace the consensus-based Wassenaar, which has been hampered in recent years by Russia’s membership (see 2310050026). U.S. officials, including Bureau of Industry and Security Undersecretary Alan Estevez, have said they are studying ways to create a new multilateral export control framework, although Estevez said in December there is some disagreement within the government about the best way forward (see 2312080053).

“It is not my understanding that the U.S. government has any sort of consensus on what to do next,” Benson said. “There are so many different constituencies and then different people working within each agency that would effectuate this decision.”

She noted that Valdis Dombrovskis, the European Commission’s top trade official, recently suggested sticking with the Wassenaar system but excluding Russia (see 2401310074). “There are a lot of different proposals that are floating around,” Benson said.

She said it “sounds like” BIS is “currently undergoing a major research effort to figure out what ought to come next,” saying it's a “very positive sign” the agency is taking time to research and “really get it right. And so I'm anxious to see what that report eventually produces.”

Reinsch noted that the compromise appropriations package released by congressional negotiators this month orders BIS to come up with a strategy to secure binding commitments from allies -- “on a bilateral or plurilateral basis” -- on new technology export controls (see 2403040061). “And so hopefully there will be an outcome there or a study that we’ll all be able to see soon,” Reinsch said.

CSIS held the event in part to discuss a report released by the think tank last month, which suggested the U.S. and allies create a new Regime on Critical and Emerging Technologies (see 2402160056). This new export control regime would include a range of member countries, and each would be assigned to a different technology committee that its respective industry specializes in, such as artificial intelligence, biotechnology, quantum technology or semiconductors.

Thibault Denamiel, a CSIS associate fellow who helped write the report, said countries would have voting power on their respective technology committees, while other nations would be “able to view the negotiations and contribute their opinions.” He argued this may be a better option than expanding the G7 because he doesn’t “know how much willingness there is amongst countries that are part of the G7 right now to actually include more nations.”

Benson said the idea of an export control regime broken up into smaller committees where only certain members can make decisions on specific technologies “gets us into politically tricky waters.” She pointed to Australia and the U.K. -- two important U.S. allies that don’t have “particularly strong semiconductor production hubs” -- and asked how the U.S. could rationalize excluding them from pivotal export control decisions.

“Do we not include them in our closed door, private national security meetings with other allies?” Benson said. “That just feels wrong to me in an era when we're trying to get everyone on one bigger page that centers really on the future of export control enforcement.”

She also said some nations may not have the resources in place to send officials to various multilateral export control committees focused on different technologies. “Some countries have just one or two, or in some cases, three people running their entire export control program,” Benson said. “And so to ask them to staff up, which would require legislative change and funding, would be quite gargantuan and, I think, politically unworkable.”

In discussions with other countries about the idea, Denamiel acknowledged that they haven’t strongly supported it. “When you provide that sort of framework, especially when you sort of limit the conversations to committees of specialized countries, then you still do have a sense that not all countries are going to have an equal share in the way they can participate through these conversations,” he said. “And so you're getting more mixed feelings about it.”

Benson said countries can support expanding the G7 because it would be similar to Wassenaar. “It's essentially the same thing. It feels familiar,” she said. “People know how to do it, lawyers around the world know how to design compliance programs around it, and export control officers know what it looks and feels like.”