United States Stays atop Global Arms Market

Article excerpt

NEWS AND NEGOTIATIONS

U.S. WEAPONS DEALS accounted for nearly half the value of all worldwide arms sales agreements and weapons deliveries last year, ranking the United States as the top global arms dealer in each of the past eight years, according to a Congressional Research Service (CRS) report published August 6.

The CRS report, Conventional Arms Transfers to Developing Nations, 1994-2001, reported that the United States signed new arms sales contracts worth $12 billion last year and shipped a total of $9.7 billion in weapons to customers around the globe. Since 1994, the United States has agreed to nearly $100 billion in arms sales, while its actual exports amounted to almost $131 billion, reflecting completion of deals signed in the early 1990s. (All figures are in constant 2001 dollars unless noted.)

Although last year's sums marked a decline from its previous year's activities, the United States did not see its market share change much because all other major arms exporters also saw a drop in new sales as the global arms market experienced its first slowdown since 1997, falling sharply from $40 billion in 2000 to $26 billion last year.

Much of the drop in last year's arms trade can be traced to a $12 billion reduction in arms buys by developing nations. Their roughly $16 billion in agreements collectively was their lowest total for the eight-year period covered by the annual report, which classifies all countries except Australia, Canada, Japan, New Zealand, Russia, the United States, and European nations as developing.

Developing countries have recently cut back on arms purchases because of their limited financial resources. Rather than buying new weaponry, many developing countries are focusing on upgrading previously bought equipment or integrating it into their militaries.

This approach has generally benefited the United States since many of its key clients in Asia and the Near East have made substantial arms buys in the past and are actively buying spare parts, services, and upgrades to keep existing equipment operational. Russia, on the other hand, suffers in comparison because a number of its top past customers, such as Syria, lack the hard currency to update or maintain their existing weaponry; and some countries doubt Moscow's ability to provide such services reliably. …