Summary: GAO discussed the U.S. military aircraft coproduction agreement with Japan. GAO found that: (1) the United States entered into aircraft coproduction agreements with Japan primarily for defense and foreign policy reasons, while Japan based its decision on economic and industrial development; (2) although the coproduction agreement has been updated twice, Japan has a license to produce 88 F-15 aircraft; (3) Japan expanded its production capacity, technological base, and aircraft labor force through the coproduction agreement; (4) Japan received advanced technology which had commercial, civil, and military applications; (5) the Departments of Defense and State rarely consider economic, industrial, and labor implications when negotiating or implementing coproduction agreements with Japan or other foreign countries; and (6) U.S. government officials expressed grave concerns over the implications of coproduction agreements for U.S. trade, economy, competition, balance-of-payments, employment, and defense production base objectives. GAO believes that a recent legislative prohibition on the transfer of U.S. defense technology would ensure that domestic interests are better represented in coproduction negotiations with foreign countries.
