Alan Estevez, Undersecretary of Commerce for Industry and Security, delivered remarks January 14th at Washington's CSIS Wadhwani AI Center, focusing on the evolving role of export controls in safeguarding U.S. national security and addressing technological threats. The conversation, moderated by Greg Allen, Director of CSIS's Wadhwani AI Center, covered key achievements, challenges, and future priorities for the Bureau of Industry and Security (BIS).
"If you look back over what we've accomplished, most of the controls we've put on related to the PRC, or related to Russia," Estevez began.
"Obviously the regular business goes on related to nuclear programs around the world and those type of things. So that business has been pretty steady state. But our business around the PRC has gotten a lot of notice. Our business around Russia has gotten a lot of notice and we stood up a brand new office called the Office of Information Communication Technology Services, OICTS, that is also making a little bit of a splash.
Estevez emphasized the effectiveness of export controls in impeding China's technological advancements and Russia's military capabilities. He stated, "The controls we have placed on semiconductors and semiconductor equipment aim to limit the PRC's ability to develop high-end artificial intelligence (AI) models that threaten U.S. and allied national security."
While acknowledging China's technological resilience, Estevez remarked, "Our goal is not to stop the PRC from developing capabilities entirely—that would be unrealistic—but to prevent them from using U.S. state-of-the-art technology to do so."
Estevez highlighted a coalition of 38 nations working to restrict technology exports that support its industrial and military base, noting, "These controls have imposed significant costs on Russia and forced them to turn to nations like North Korea and Iran for supplies."
"Artificial intelligence has some game changing capabilities that can help all of us in our daily lives going into the future. It also has malicious applications to it. Most people think about the deep fakes and you know, news related issues around artificial intelligence, but artificial intelligence for military application enhances command and control, enhances targeting, enhances logistics, enhances autonomous warfare. All those things are very worrisome.
"On top of that artificial intelligence that the next generations of models, not the models that are there today, are going to facilitate cyber capabilities, cyber warfare capabilities, that's going to facilitate biological development capabilities. All sorts of things that artificial intelligence can be used for for purposes that go against the national security interests of the United States and its allies.
"So the controls we put on semiconductors and semiconductor equipment going to the. PRC's have all been about impeding the PRC's ability to build the large language models that have threatened the United States and its allies from a national security perspective."
Estevez acknowledged the tension between national security and economic considerations, clarifying, "Export controls are rooted in national security, not economic competition. However, these measures do intersect with economic security, especially in strategic sectors like semiconductors and AI."
"I would argue that no administration has been more focused and tougher on the PRC with relationship to that. I will give credit to the previous Trump administration for starting some of the things that we took on that path. But we really took it to another level, industrialized it if you if you would.
"Issuing countrywide controls versus specific entity focus controls, growing the Allied base around those controls have been really critical and I think have impeded the PRC's ability to develop the highest end chips and to develop those. AI models that will threaten us in the near term.
Estevez reiterated the need for the U.S. to maintain its innovation edge, stating, "While export controls are hurdles for adversaries, they are not a permanent solution. The United States must continue to innovate faster to stay ahead.
On Enforcement and Settlements: Estevez addressed concerns about enforcement and the adequacy of settlements, explaining, "We take a balanced approach, considering voluntary disclosures and cooperation by companies. However, significant fines, like the $300 million settlement with Seagate, demonstrate our resolve to enforce compliance."
He also called for greater resources to strengthen enforcement, highlighting gaps in personnel and technology. "Our enforcement arm is under-resourced, working with systems that are outdated and inadequate for the complexity of today's challenges."
Estevez outlined a series of critical rules issued under his tenure, including controls targeting semiconductors, AI diffusion, and biotech. Regarding the January 2025 AI diffusion rule, he noted, "This rule aims to secure sensitive model weights and prevent adversaries from misusing AI for military and other malicious purposes, while allowing legitimate commercial activities to continue."
He acknowledged the evolving nature of threats and the need for continuous updates to export control parameters. "Technology moves fast; our controls must keep pace. Adjustments, like those made in October 2023 and December 2024, reflect this dynamic environment."
"We've done all this under a resourcing scheme that's essentially been the same since 2010. My budget has essentially been flat, aside from the bump up I received for the ICTS program, since 2010.
"You know, it feels like the budget for Russian smugglers has 10X and the budget for Chinese smugglers has 10X. And the budget has remained flat. It just strikes me as unacceptable.
"I don't know if any of you look at the rules that we put out, other than the headlines, but they're pretty complex. They're not 30 page rules anymore. They're 250 page rules.
"I need a new IT backbone. I need more gumshoes as far as agents. We need more licensing officers and I need applications, things like Palantir, to help my agents do tracking. I need supply chain illumination tools and all sorts of other apps. And frankly, I could use artificial intelligence in this space too.
"This this is not, to use the commercial analogy here, your grandfathers BIS. Maybe the computers, but not the not the work. We are certainly in the hot dead center of national security.
As his tenure concludes, Estevez advised the incoming administration to sustain alliances and maintain vigilance. "National security is not a partisan issue. Our work with allies has been critical, and it must continue to adapt to emerging threats."
"I personally have not talked to the incoming Trump team. There's a team on the ground in Commerce who's talking to the career guys, career officials, which is fine, about what we've been doing and how we've been doing it. "Secretary Raimondo certainly has talked to her potential successor, Howard Lutnick on a umber of occasions.
" I can't say what they're going to do. Many of them actually can't really say exactly how it all plays out. My advice would be to sustain these alliances and build on them. And that's the key towards true protection here."
Reflecting on his time at BIS, Estevez remarked, "This role has been one of the toughest but most rewarding of my career. The stakes are high, but so is our commitment to securing the nation's future."
(Program length: 60 minutes)
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