The arms industry is a global
business which
manufactures
weapons and
military technology and equipment. It consists of
commercial
industry involved in research, development, production, and service
of
military
material, equipment and facilities. Arms producing companies, also
referred to as
defense contractors or military industry, produce arms mainly
for the
armed forces of
states. Departments of government also operate in the arms industry,
buying and selling weapons, munitions and other military items. Products
include guns,
ammunition,
missiles,
military aircraft,
military vehicles,
ships,
electronic systems, and more. The arms industry also conducts
significant
research and development.
It is estimated that yearly, over 1.5 trillion dollars are spent on
military expenditures worldwide (2.7% of World
GDP).[1]
This represents a decline from 1990 when military expenditures made up
4% of world GDP. Part of this goes to the procurement of military
hardware and services from the military industry. The combined arms
sales of the top 100 largest arms producing companies amounted to an
estimated $315 billion in 2006.[2]
In 2004 over $30 billion were spent in the international arms trade (a
figure that excludes domestic sales of arms).[3]
The arms trade has also been one of the sectors impacted by the
credit crunch, with total deal value in the market halving from
US$32.9bn to US$14.3bn in 2008.[4]
Many
industrialized countries have a domestic arms industry to supply
their own military forces. Some countries also have a substantial legal
or illegal domestic trade in weapons for use by its citizens. An illegal
trade in
small arms is prevalent in many countries and regions affected by
political instability.
Contracts to supply a given country's military are awarded by the
government, making arms contracts of substantial political importance.
The link between politics and the arms trade can result in the
development of what US President
Dwight D. Eisenhower described as a
military-industrial-congressional complex, where the armed forces,
commerce, and politics become closely linked. The
European defence procurement is more or less analogous to the U.S.
military-industrial complex. Various corporations, some publicly
held, others private, bid for these contracts, which are often worth
many billions of dollars. Sometimes, such as the contract for the new
Joint Strike Fighter, a competitive tendering process takes place, where
the decision is made on the merits of the design submitted by the
companies involved. Other times, no bidding or competition takes place.
In the
Cold
War Era, arms exports were used by both the
Soviet Union and the
United States to influence their standings in other countries,
particularly
Third World Countries.
Sectors
The
AK series of weapons have been produced in greater
numbers than any other
firearm and have been used in conflicts all over the
world.
Land-based weapons
This category includes everything from
light arms
to
heavy artillery, and the majority of producers are small. Many are
located in
Third World countries. International trade in
handguns,
machine guns,
tanks,
armored personnel carriers and other relatively inexpensive weapons
is substantial. There is relatively little regulation at the
international level, and as a result, many weapons fall into the hands
of organised crime, rebel forces, terrorists, or regimes under
sanctions.[5]
Small arms
The
Control Arms Campaign, founded by
Amnesty International,
Oxfam,
and the
International Action Network on Small Arms, estimated in 2003 that
there are over 639 million small arms in circulation, and that over
1,135 companies based in more than 98 different countries manufacture
small arms as well as their various components and ammunition.[6]
Aerospace systems
Encompassing military aircraft (both land-based and
naval aviation), conventional missiles, and
military satellites, this is the most technologically advanced
sector of the market. It is also the least competitive from an economic
standpoint, with a handful of companies dominating the entire market.
The top clients and major producers are virtually all located in the
western world, with the United States easily in first place.
Prominent aerospace firms include
Dassault Aviation,
Sukhoi,
Mikoyan,
EADS,
Finmeccanica,
Thales Group,
Lockheed Martin,
Boeing,
and
BAE Systems. There are also several
multinational consortia mostly involved in the manufacturing of
fighter jets, such as the
Eurofighter. The largest military contract in history, signed in
October 2001, involved the development of the
Joint Strike Fighter.[5]
Naval systems
All of the world's
major powers maintain substantial maritime forces to provide a
global presence, with the largest nations possessing
aircraft carriers,
nuclear submarines and advanced
anti-air defense systems. The vast majority of military ships are
conventionally powered, but some are nuclear-powered. There is also a
large global market in second-hand naval vessels, generally purchased by
developing countries from
Western governments.[5]
World's largest defense budgets
This is a list of the ten countries with the highest defence budgets
for the year 2011, which is $1.29 trillion or 74% of total world
expenditures. The information is from the
Stockholm International Peace Research Institute.[7]
Total world spending amounted to $1.74 trillion USD in 2011.
-
^a
SIPRI estimates
-
^b
SIPRI: "The figures for Saudi Arabia include expenditure on public
order and safety and might be slight overestimates"
World's largest arms exporters
The unit in this table are so-called trend indicator values expressed
in millions of
US dollars at 1990s prices. These values do not represent real
financial flows but are a crude instrument to estimate volumes of arms
transfers, regardless of the contracted prices, which can be as low as
zero in the case of military aid. Ordered by descending 2000–2010
values. The information is from the
Stockholm International Peace Research Institute.[8]
1 |
United
States |
5908 |
5229 |
5698 |
6866 |
6700 |
7453 |
8003 |
6288 |
6658 |
8641 |
9984 |
- |
|
2 |
Russia |
5896 |
5705 |
5236 |
6178 |
5134 |
5095 |
5426 |
5953 |
5575 |
6039 |
7874 |
7967[9] |
|
3 |
Germany |
850 |
916 |
1713 |
1105 |
2080 |
2567 |
3194 |
2500 |
2432 |
2340 |
1206 |
- |
|
4 |
France |
1297 |
1368 |
1345 |
2219 |
1724 |
1643 |
2432 |
1994 |
1865 |
1834 |
2437 |
- |
|
5 |
China |
499 |
509 |
665 |
292 |
303 |
597 |
430 |
586 |
1000 |
1423 |
1354 |
- |
|
6 |
United
Kingdom |
1368 |
1068 |
741 |
1316 |
1039 |
855 |
1018 |
982 |
1022 |
1054 |
1070 |
- |
|
7 |
Italy |
880 |
191 |
526 |
314 |
538 |
432 |
366 |
454 |
383 |
806 |
1046 |
- |
|
8 |
Israel |
203 |
239 |
342 |
209 |
583 |
1187 |
1326 |
530 |
545 |
503 |
531 |
- |
|
9 |
Sweden |
216 |
426 |
341 |
212 |
774 |
502 |
684 |
417 |
514 |
806 |
686 |
- |
|
10 |
Ukraine |
700 |
311 |
442 |
200 |
290 |
553 |
728 |
330 |
320 |
201 |
484 |
- |
|
11 |
Spain |
7 |
120 |
150 |
56 |
108 |
843 |
590 |
610 |
998 |
513 |
927 |
- |
|
12 |
Switzerland |
193 |
157 |
181 |
243 |
246 |
285 |
301 |
482 |
255 |
137 |
297 |
- |
|
13 |
Canada |
129 |
170 |
263 |
265 |
226 |
226 |
334 |
227 |
169 |
258 |
292 |
- |
|
14 |
South
Korea |
165 |
N/A |
100 |
29 |
48 |
94 |
220 |
80 |
163 |
95 |
225 |
- |
|
The information is also from the Stockholm International Peace
Research Institute or from the national defence commissions where
available and is updated at least once a year.
Next to SIPRI there are several other sources that provide data on
international transfers of arms. These include national reports by
national governments about arms exports, the UN register on conventional
arms and an annual publication by the
US Congressional Research Service that includes data on arms exports
to developing countries as compiled by
US intelligence agencies. A list of such sources can be found at the
SIPRI website.
[10]
Due to the different methodologies and definitions used different
sources often provide significantly different data. For example,
according to
Statistisk sentralbyrå (Norway state statistics), Norway exports a
greater value (in USD) of arms than many of the nations listed above.
Some of the differences are possibly due to deliberate over- or
under-reporting by some of the sources. Governments may claim high arms
exports as part of their role in
marketing efforts of their national arms industry or they may claim
low arms exports in order to be perceived as a responsible international
actor.
As of 2008 Britain has become the worlds leading developer of arms
with British company BAE Systems.[11]
Defence group BAE Systems is the first company outside the U.S. to reach
the top position,thanks to a deal with the Pentagon for mine-resistant
vehicles to be used in Iraq and Afghanistan. According to the Stockholm
International Peace Research Institute, a defence think tank, the former
British Aerospace group's arms sales are ahead of American market
leaders Lockheed Martin and Boeing. The report reveals BAE's U.S.
subsidiary was alone responsible for 61.5 per cent of the group's arms
sales and around 58.5 per cent of total group sales. This demonstrates
BAE's increasing reliance on orders for conventional weapons as the U.S.
cuts back on its nuclear arsenal. The British figures were also boosted
by orders for Eurofighter Typhoon jets from Saudi Arabia.
After the success of Pakistan's major developments in the defence
industry the Defence Export Promotion Organisation (D.E.P.O.) was
created to promote Pakistani defence equipment to the world by inviting
major and small players to the I.D.E.A.S. Exhibition, which is held
annually at the Karachi expo center. In recent reports, the defence
exports were worth over $500 million USD in 2006 and growing annually.
World's largest arms importers
The units in this table[12]
are so-called trend indicator values expressed in millions of
US dollars. These values do not represent real financial flows but
are a crude instrument to estimate volumes of arms transfers, regardless
of the contracted prices, which can be as low as zero in the case of
military aid.
1 |
India |
911 |
1242 |
1872 |
2802 |
2227 |
1036 |
1257 |
2179 |
1810 |
2116 |
3337 |
2 |
Australia |
364 |
1191 |
647 |
798 |
505 |
470 |
682 |
629 |
380 |
757 |
1677 |
3 |
South
Korea |
1262 |
623 |
461 |
680 |
986 |
686 |
1650 |
1758 |
1821 |
1172 |
1131 |
4 |
Singapore |
622 |
220 |
235 |
88 |
384 |
543 |
52 |
368 |
1123 |
1729 |
1078 |
5 |
United
States |
301 |
449 |
453 |
533 |
512 |
501 |
581 |
731 |
808 |
831 |
893 |
6 |
Algeria |
418 |
553 |
237 |
197 |
272 |
156 |
308 |
471 |
1518 |
942 |
791 |
7 |
Saudi
Arabia |
158 |
397 |
533 |
592 |
385 |
332 |
262 |
613 |
939 |
1146 |
2580 |
8 |
Greece |
710 |
725 |
491 |
2241 |
1528 |
389 |
598 |
1796 |
563 |
1269 |
703 |
9 |
China |
2015 |
3366 |
2819 |
2207 |
3080 |
3511 |
3831 |
1474 |
1481 |
595 |
559 |
10 |
United
Arab Emirates |
243 |
186 |
213 |
695 |
1246 |
2198 |
2026 |
938 |
748 |
604 |
493 |
11 |
Pakistan |
80 |
59 |
555 |
159 |
1161 |
148 |
185 |
64 |
115 |
626 |
787 |
12 |
Turkey |
1170 |
553 |
1009 |
438 |
187 |
1005 |
422 |
585 |
578 |
675 |
468 |
13 |
Malaysia |
30 |
26 |
131 |
135 |
48 |
51 |
410 |
546 |
541 |
1494 |
411 |
14 |
Norway |
263 |
148 |
92 |
4 |
6 |
14 |
469 |
494 |
536 |
576 |
205 |
15 |
Indonesia |
171 |
27 |
63 |
398 |
82 |
31 |
58 |
577 |
241 |
452 |
198 |
[12]
List of major weapon manufacturers
Private military contractors are private companies that provide
logistics, manpower, and other expenditures for a military force.
Major arms industry corporations by nation
Institutes participating in weapon research and warfare simulation
Arms control
Oscar Arias Sanchez President of
Costa Rica (awarded the
Nobel Peace Prize in 1987 for his efforts to end civil wars across
Central America through the
Esquipulas II Accords) has stated:
“ |
When a
country decides to invest in arms, rather than in education,
housing, the environment, and health services for its people, it
is depriving a whole generation of its right to prosperity and
happiness. We have produced one firearm for every ten
inhabitants of this planet, and yet we have not bothered to end
hunger when such a feat is well within our reach. Our
international regulations allow almost three-quarters of all
global arms sales to pour into the developing world with no
binding international guidelines whatsoever. Our regulations do
not hold countries accountable for what is done with the weapons
they sell, even when the probable use of such weapons is
obvious.[14] |
” |
International treaties for arms control
- The
Arms Trade Treaty is the name of a potential multilateral treaty
that would control the international trade of conventional weapons.
The treaty is in the preliminary stages of development and has not
yet been officially negotiated.
- The
Missile Technology Control Regime (MTCR) is an informal and
voluntary partnership between 34 countries to prevent the
proliferation of missile and unmanned aerial vehicle technology
capable of carrying a 500 kg payload at least 300 km.
- The
Limitation of Naval Armament included many separate treaties. In
general, the treaties involved the United States, United Kingdom,
Japan, and France.
- The
Convention on Cluster Munitions (CCM) is an international treaty
that prohibits the use of cluster bombs, a type of explosive weapon
which scatters submunitions ("bomblets") over an area.
- The
Outer Space Treaty, formally known as the Treaty on Principles
Governing the Activities of States in the Exploration and Use of
Outer Space, including the Moon and Other Celestial Bodies, is a
treaty that forms the basis of international space law.
- The
Ottawa Treaty or the Mine Ban Treaty, formally the Convention on
the Prohibition of the Use, Stockpiling, Production and Transfer of
Anti-Personnel Mines and on their Destruction, completely bans all
anti-personnel landmines (AP-mines).
- The
New START Treaty (for Strategic Arms Reduction Treaty) (Russian:
СНВ-III) is a bilateral nuclear arms reduction treaty between the
United States and the Russian Federation that was signed in Prague
on April 8, 2010.
- The Protocol for the Prohibition of the Use in War of
Asphyxiating, Poisonous or other Gases, and of Bacteriological
Methods of Warfare, usually called the
Geneva Protocol, is a treaty prohibiting the first use of
chemical and biological weapons. It was signed at Geneva on June 17,
1925 and entered into force on February 8, 1928. It was registered
in League of Nations Treaty Series on September 7, 1929.
- The
Chemical Weapons Convention (CWC) is an arms control agreement
which outlaws the production, stockpiling and use of chemical
weapons.
- The
Biological Weapons Convention (or Biological and Toxin Weapons
Convention) was the first multilateral disarmament treaty banning
the production of an entire category of weapons. It was the result
of prolonged efforts by the international community to establish a
new instrument that would supplement the 1925 Geneva Protocol.
The
European Council stated to the
United Nations General Assembly:
“ |
We are
committed to upholding, implementing and further strengthening
the multilateral
disarmament and
non-proliferation framework in the fight against threats
which are tending to escape the control of national sovereignty,
the challenges deriving from destabilising accumulation and
spread of small arms and light weapons, from illicit or
irresponsible arms trade, and from the proliferation of weapons
of mass destruction, which are creating new and growing
hot-spots of international tension. In this regard, the EU
welcomes the growing support in all parts of the world for an
International Arms Trade Treaty and is firmly committed to this
process.[15] |