Bonn Acts to Tighten Reins on War Goods : Germany: The Kohl government reviews policy and may increase punishment for firms skirting restrictions.

Against a backdrop of the Persian Gulf War, Chancellor Helmut Kohl’s newly constituted government Monday moved to further tighten controls on the country’s controversial export policy.

A high-level working group from several ministries met in the chancellory to discuss strengthening existing measures to monitor goods shipped to the Middle East and the Third World.

A toughening of punishment for businesses that skirt the restrictions is also likely, government officials said.

“It’s a working group that will work through the possibilities fairly quickly,” Economics Ministry spokesman Volker Franzen said.

He said formal proposals will be presented Wednesday both to Kohl’s Cabinet and to a special session of the parliamentary economic affairs committee that will deal with the subject.

Any new measures would constitute the latest in a series of efforts over the last three years to close dangerous and embarrassing loopholes in export regulations that have allowed highly sensitive nuclear and chemical weapons technology to find their way to the Third World, including Libya and Iraq.

The prospect that German technology has contributed to the chemical warfare capability of Iraq, a country that has already fired missiles at Israel, has dismayed many Germans.

Government discomfort has been heightened by the absence of any German ground forces in the immediate gulf region who might have shared the risks with soldiers from the United States, Britain, France and other nations who now face Iraqi forces.

Television footage of anxious Israelis wearing protective gas masks during an air raid alert in Tel Aviv have also deeply affected many Germans.

“This week the Germans don’t present a good image,” commented Manfred Schell, editor of the conservative daily Die Welt in a front-page editorial Monday.

The leader of the main opposition Social Democrats, Hans-Jochen Vogel, accused Kohl on Monday of going soft on the country’s business community. He demanded a constitutional amendment banning exports of equipment with a possible military use to nations outside the Western alliance. He also urged that company executives suspected of violating export controls be handled as common criminals.

“They are engaging in the business of death,” Vogel said.

Because Germany bans the sale of military weapons to areas of tension, its export volume of such items is relatively modest by European standards. According to U.S. congressional statistics, West Germany exported only $250 million worth of systems in 1989, compared to $1.8 billion by France and $2.3 billion from Britain.

Its sale of industrial products which have a potential military application--so-called dual-use items--is far more dubious, however.

Revelations three years ago that German businessmen had sold highly sophisticated technology to Libya and Iraq capable of being used to wage chemical and nuclear warfare shocked the government but failed to halt the flow.

German businessman Juergen Hippenstiel-Imhausen was jailed in 1989 for only three years--the maximum sentence at the time--for providing Libya major elements of a poison gas plant at Rabta.

Last year, the government tightened some loopholes in its export controls and raised the maximum penalty to 10 years in jail, yet a number of German companies remain high on the lists of those suspected of violating the United Nations-imposed arms embargo.

An Economics Ministry spokesman confirmed Monday that about 80 German companies have been named as suspected embargo violators and that evidence had so far led to full-scale investigations being launched against seven of these companies to date.

The spokesman also confirmed that Kohl’s new Economics Minister, Juergen Moellemann, the man ultimately responsible for enforcing any new export controls, will retain his job as president of the German-Arab Society, an organization that promotes relations between Germany and the Arab states.