Revising Missile Controls Is Necessary to Help Allies and Prevent New Nuclear States

As the presidential transition began in January 2025, President Biden promulgated a new National Security Memorandum (NSM) on missile technology exports to advance “the President’s goals of strengthening allied defense capabilities, bolstering the U.S. defense industrial base, streamlining defense trade, and deterring adversaries.” The NSM issued new policy guidance on implementing the Missile Technology Control Regime (MTCR), a 40-year voluntary export control arrangement negotiated by G7 countries to prevent the proliferation of missile technology. An understated benefit of the new policy is the advancement of nuclear nonproliferation policy. The world today is fundamentally different from what MTCR negotiators envisioned in the 1980s, during U.S. efforts to expand the regime to all weapons of mass destruction in the 1990s, or amid its focus on rogue states and non-state actors in the 2000s. In a reversal of the nonproliferation assumptions of the 1980s, boosting allies’ conventional missile, unmanned aerial vehicle, and missile defense capabilities is an important pillar in a strategy to avert “friendly” nuclear proliferation—giving allies important nonnuclear capabilities to take on a greater defense burden. Allies and partners, many of whom designed strong export controls to adhere to the MTCR and other multilateral nonproliferation arrangements, are best able to protect shared U.S. missile technology and use it to support the U.S. military in potential conflicts.

Eliminating barriers to defense trade fits squarely within the Trump administration’s efforts to boost investment and productivity in the U.S. economy. In his first term, President Trump also focused on adjusting MTCR policy, carving out unmanned aerial system exports, a step that is also consistent with former President Biden’s efforts to streamline export controls to aid allies. As the United States considers a global defense posture that realigns its security commitments to allies, several countries are considering the first-time development of nuclear weapons to replace a potentially fading U.S. guarantee in the face of aggressive, proximate adversaries.

Adhering to the MTCR while adjusting license policy allows the United States to keep missile technology away from adversaries while ensuring allies and partners that maintain strong export controls reap the benefits of streamlined U.S. missile exports. President Trump’s new executive order, “Reforming Defense Sales to Improve Speed and Accountability,” would benefit from his administration following through on implementing the policy in Biden’s NSM, and the new administration should consider taking additional steps to bolster allied defense capabilities through U.S. technology trade while creating opportunities for allied investments in the U.S. defense industrial base, particularly missile, munitions, and space launch sectors.

MTCR to Date

Before the NSM, the U.S. government generally denied the export of Category I MTCR (Cat I) technologies. The G7 developed MTCR as a way to discourage weapons of mass destruction development by limiting ease of access to delivery platforms; one part of a patchwork of multilateral nonproliferation agreements concluded at the end of the Cold War that largely operate by consensus (including with Russia). Today, 35 nations adhere to the MTCR guidelines, many of which are close friends of the United States. Despite this cooperation, missile technologies spread into adversary arsenals over time. This policy can also be said to have caused, in part, some perverse outcomes, such as close allies like South Korea turning to Russia for space launch vehicle (SLV) technology instead of the United States. Meanwhile, the number of states with nuclear weapons at the time of MTCR’s promulgation—nine—is the same.

Cat I technology includes missiles and unmanned aerial systems that have a range of 300 km and can carry a payload of 500 kg and are subject to a strong presumption of denial per the MTCR Guidelines. Exports to close U.S. allies were delayed due to lengthy review processes and were even denied. The policy process led to a chilling effect, where industry and international partners felt the United States maintained a de facto policy of denial, and proposing exports for license approval was not worth the preparatory investment. Cat I systems are an essential component of military capabilities. Enabling the United States’ closest allies to obtain necessary military capabilities strengthens U.S. national security through increased interoperability and burden sharing while also supporting the U.S. defense industrial base. Failing to adjust the MTCR policy results in other countries providing these necessary capabilities to U.S. allies, raising espionage and interoperability concerns.

In addition to truly military systems, due to the definition and similarities in technology, SLVs are also considered to be MTCR Cat I systems. The U.S. government has stymied potential international development and business opportunities for the rapidly growing commercial space sector through its strict interpretation of MTCR, beyond the practice by other friendly adherents to the guidelines. Importantly, the commercial space sector is increasingly playing an important role in national security missions as well.

Background on the 2025 NSM

The shift in U.S. government MTCR policy provides clear guidance to the officials who decide whether a company can export missile technology by outlining the contours of when the MTCR presumption of denial may be overcome. This clear guidance, emphasizing adherence to the highest nonproliferation standards, export controls, and enforcement, allows the U.S. government to review potential exports of missile technology more efficiently. In short, the guidance provides clear foreign policy markers for technical license reviewers to use in assessing an incoming license application.

The Biden administration recalibrated MTCR policy and export controls against a background of mounting nonproliferation, deterrence, and defense production challenges for U.S. allies and partners. As the United States and like-minded partners sought to advance nonproliferation policies, particularly the Wassenaar Arrangement and MTCR, rivals undermined both. Russia blocked the adoption of new controls on dual-use technologies, preventing alignment on how to regulate militarily-relevant technologies such as quantum computing and artificial intelligence, and circumvented MTCR guidelines to receive Shahed drones from Iran.

At the same time, menacing signals from Russia and North Korea create concerns among U.S. allies that existing conventional defenses may be insufficient to deter aggression from a nuclear-armed state. Allies could contribute to administration defense policy initiatives, including missile defense interceptors relevant to President Trump’s “Golden Dome” missile defense architecture, with greater access to MTCR-controlled technology. Countries such as South Korea, backed by the U.S. nuclear arsenal, could produce advanced conventional missile capabilities at scale to deter North Korean escalation. Similarly, Japanese allies could contribute to deterring Chinese aggression in the West Pacific with U.S. technological assistance to develop advanced, long-range anti-ship missiles. And as demonstrated in Ukraine, long-range precision strike capabilities play an outsized role in helping shore up defensive lines against larger aggressors, particularly as the longevity of the conflict attrits manpower.

Ukraine also demonstrated the limits of allied and partner defense industrial bases for developing precision-guided, long-range munitions. The necessity for an abundance of long-range missiles and unmanned aerial systems was demonstrated during the ongoing conflict, but the production rate and money required to produce these capabilities at scale far outpaced that which Western arms manufacturers could provide, particularly with strong restrictions on sharing missile technology with one another. A similar dynamic could be expected for allied support to Taiwan in the event of PRC aggression.

Addressing Critics

In this environment, the Biden administration chose to modernize its approach to the MTCR, while continuing to adhere to the guidelines. Changing nonproliferation policies rightfully generates closer examination and critique.

Nonproliferation experts criticized the move for a few reasons.

First, some allege the policy change will permit long-range missile trade to non-MTCR member countries. As articulated in the administration factsheet, Biden’s policy shift is to “advance shared defense objectives with close allies,” many of whom are MTCR members, while others still cooperate with the U.S. government on export controls much more today than in the 1990s. In fact, some non-regime members can and do adhere to the nonproliferation export control regimes regardless of membership status. Furthermore, the NSM continued a commitment to prevent “the transfer of technologies that would threaten the United States, allies, partners, and other countries around the world.”

Importantly, other restrictions on sharing sensitive technologies, such as technology safeguards agreements or “TSAs,” and other government-to-government agreements required for the approval of individual exports, still remain. Allies and partners seeking favorable treatment under the new policy have an incentive to strengthen their own export controls and alignment with U.S. defense strategy for greater access to MTCR-controlled technology; a model for doing so exists in AUKUS, where the United Kingdom and Australia improved export controls.

While the MTCR provides an important standard for responsible missile technology holders to use in guiding export controls, after 40 years, the missile technology environment has changed drastically. Two non-MTCR nations of significant foreign policy concern, North Korea and Iran, both developed substantial missile and drone capabilities outside of MTCR and exported these technologies to Russia, which is using them against Ukraine. Taiwan and South Korea possessed ballistic missile programs in 1987; regardless of the MTCR, each country developed sophisticated missile programs and now follow the MTCR guidelines. Taiwan is also working on an SLV and a spaceport. At the same time, the United States is actively encouraging Taiwan and South Korea to take on a greater defense burden in the face of elevated risks from China and North Korea. Taiwan and South Korea are among those facing acute nuclear proliferation pressures that each felt during the Cold War.

Second, the United States will increase support for partner space-launch vehicle programs, which many countries treat as interchangeable with ballistic missiles for weapons delivery purposes. At the time of MTCR negotiations in 1987, India, Japan, and Australia possessed advancing space launch programs. Today, they all own substantial space-launch capabilities and procured military ballistic missile systems. The United States works closely with several allies on national security space missions as well, such as the recent deployment of a U.S. Space Force domain awareness payload via a Japanese space launch vehicle. All three countries partner closely with the United States on space security and will likely increase collaboration on national security space launches moving forward. Like-minded partners with expanded space launch capabilities will enable the United States to achieve a higher rate of placing satellites in orbit for critical national security missions, particularly as the United States looks to boost the resilience of its space architecture against adversary attack with a proliferated satellite constellation.

Third, over time, support for space launch programs will create indigenous foreign competitors for the private space companies. Based on recent data, U.S. space companies import substantial foreign components for space launch programs. The time of U.S. space unipolarity has long passed; even in the late 1980s, the European Space Agency and Japanese space launch programs were developing quickly. Today, the United States imports tens of millions of dollars for commercial space activities. Global space launches tripled in the past 15 years, and are slated to grow year after year moving forward. The U.S. Bureau of Economic Analysis estimates the U.S. “space economy” contributes more than $100 billion a year to the overall gross domestic product. In short, the commercial space industry is booming, and countries are racing to develop their own satellites, rocket engines, propellant systems, and launch systems, along with the manufacturing supply chains to support these technologies. The U.S. space industry may be left out if previous MTCR restrictions continue to be imposed. It is also unclear if new tariffs will deter U.S. space industry development and cooperation, which could instead be spurred by the January 2025 MTCR policy.

Finally, some note that the nonproliferation regime writ large is under duress. Weakening the MTCR could result in further harm to other accords, such as the Nuclear Nonproliferation Treaty, Wassenaar Arrangement, Nuclear Suppliers Group, or Australia Group. The reality is that the nonproliferation regime, and its constituent components, require updating for a new security reality. Export control–related arrangements, such as Wassenaar, are already being used to establish controls on emerging technologies related to AI and quantum computing. The Nuclear Suppliers Group will likely require updating for advanced nuclear technologies utilized in the next generation reactor designs. The purpose of maintaining these arrangements is to secure technologies that could be used or misused to aid illicit weapons of mass destruction programs and proliferation. Upholding the nonproliferation regime should not be inconsistent with U.S. defense and foreign policy goals. The United States can and should remain committed to MTCR’s terms, along with other arrangements, and ensure it implements these regimes with current security dynamics and the future in mind, paying heed to the higher risk of nuclear nonproliferation resulting from insufficient conventional deterrence and assurance.

Tending the Nonproliferation Garden

While missile export controls and commercial trade are intertwined, the most crucial measure for U.S. nonproliferation policy is an assessment of national security pros and cons. For a long time, the United States was uniquely restrictive in commercial space exports among MTCR partners. The January MTCR policy allows for the United States to continue to uphold the strongest nonproliferation policies and standards by evaluating exports of missile technology on a case-by-case basis, while outlining scenarios that are in the interest of U.S. national security in which an export can overcome the United States’ strong presumption of denial policy.

The new administration similarly felt MTCR policy must be adjusted, citing U.S. industry competitiveness with other exporting countries as a key rationale for loosening restrictions on drone trade. Today, the security environment is much more concerning. The combination of realigning U.S. defense posture away from Europe, a much more aggressive Russia, a growing Chinese military, and build-ups in adversary nuclear arsenals creates increased pressure among U.S. allies and partners to consider nuclear proliferation. At the same time, Washington is demanding that allies take on a greater defense burden. The revised MTCR policy can actively strengthen allies and support the U.S. defense and space industries, rather than leaving allies to manage a broad-based rearmament effort on their own. The administration should develop test projects with close allies—assisting the production of Europe’s new “ELSA” project, for example—to observe how efficiently the licensing process moves under the new policy. Additionally, the administration should consider where it can further build flexibility into MTCR policy, particularly as programs such as the U.S. Air Force Collaborative Combat Aircraft present a novel manned-unmanned weapons system which is distinct from the unmanned aircraft system capabilities MTCR members currently regulate as Category I systems, but will be increasingly important for high-end defense technology partnerships among allies, such as AUKUS Pillar II.

Now it is up to allies, partners, and domestic and foreign defense and space industry entities, to test the new policy and approach the U.S. government with requests for exports and cooperation. In doing so, the Trump administration can continue evolving U.S. missile nonproliferation policy to address the needs of a changing security environment, including the need for the United States to help its allies develop sufficient military capabilities to take on a greater conventional deterrence burden while continuing to maintain high international nonproliferation standards.

Pranay Vaddi is a senior associate (non-resident) with the Project on Nuclear Issues at the Center for Strategic and International Studies in Washington, D.C. Ola Craft is a senior trade advisor with Lowenstein Sandler, LLP. Both recently served on the National Security Council.

Reprinted with permission on Center for Strategic & International Studies (CSIS) on May 5, 2025 © 2025 Center for Strategic & International Studies. All Rights Reserved.