U.S. tags China with stiff penalties

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The State Department has imposed economic sanctions on China for its sales of missile technology, State Department officials said yesterday.

"These are the strongest sanctions we've ever imposed on China," said one official, speaking on the condition of anonymity.

The sanctions were imposed on the government-run conglomerate Norinco and will ban all export licenses on controlled U.S. goods to China. That ban prohibits launches of U.S. satellites on Chinese rocket booster.

Additionally, the sanctions triggered a provision of the Arms Export Control Act that could lead to a ban on imports of a large number of Chinese goods into the United States.

All of Norinco's products are banned from entering the United States under the new sanctions.

But more severe sanctions that cover other major Chinese companies were waived for one year and could be triggered if China continues to permit its companies to sell missiles to rogue states, said officials who spoke on the condition of anonymity.

Those sanctions could cost China "billions" of dollars in lost sales, one official said.

"These sanctions invoke the Helms amendment," the official said. "In this case what it does is that it prevents the U.S. government from issuing any type of export license to a variety of products, including satellite launches."

The 1991 Helms amendment to the arms-control act, named after Sen. Jesse Helms, North Carolina Republican, punishes nations with nonmarket economies, such as China, by extending sanctions to all companies.