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Arms industry
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The arms industry is a global industry and business which manufactures and sells weapons and military technology and equipment. Arms producing companies, also referred to as Defence companies or military industry, produce arms mainly for the armed forces of states. 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 trillion dollars are spent on military expenditures worldwide (2% of World GDP).
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Encyclopedia
The arms industry is a global industry and business which manufactures and sells weapons and military technology and equipment. Arms producing companies, also referred to as Defence companies or military industry, produce arms mainly for the armed forces of states. 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 trillion dollars are spent on military expenditures worldwide (2% 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. In 2004 over $30 billion were spent in the international arms trade (a figure that excludes domestic sales of arms). 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. The 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 complex, where the armed forces, commerce, and politics become closely linked. 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. Since the fall of the Soviet Union, global arms exports initially fell slightly, but have since grown again to cold war levels. The United States is the overall top supplier of weapons. The United States is also the top supplier of weapons to the developing world, accounting for around 36% of worldwide weapons sales, followed by Russia, Britain, Germany and China.
The , founded by Amnesty International, Oxfam, and the International Action Network on Small Arms, estimates that there are over 600 million items of small arms in circulation, and that over 1135 companies based in more than 98 different countries manufacture small arms as well as their various components and ammunition. According to Oxfam, an estimated 500,000 individuals die in small arms-conflicts every year, approximately one death per minute.
Sectors
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 personal carriers and other relatively inexpensive weapons is substantial. There is relatively little regulation at the international level, and as a result, many legitimately produced weapons fall into the hands of rebel forces, terrorists, or regimes under sanctions.
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 West, with the United States easily in first place. Prominent aerospace firms include Dassault Aviation, EADS,Finmeccanica, Thales Group, Lockheed Martin, Boeing, and Britain's 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.
Naval systems
All of the world's major powers maintain substantial maritime forces to provide a forward presence and enhance overall mobility, 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.
World's largest defence budgets
This is a list of the fifteen countries with the highest defence budgets for the year 2006. The information is from the Stockholm International Peace Research Institute . Total world spending amounted to $1.558 trillion USD in 2006, with more than half of the total amount spent by the United States.
- Budget does not include funds for soldiers training, pay, pensions or medical benefits as the Brazilan government classafies these as education, welfare, and medicine. This figure also does not include military research or military aerospace funding which the Brazilian government classifies as scientific research. Although the Brazilian government states that it spends only $ 190 Billion USD on defense the C.I.A. estimates that it's true budget is between $ 250 Billiion USD and $ 320 Billion
- According to the C.I.A., Mexico does not report it's full military spending for national security purposes and it's true budget is most likely $ 210 Billion USD or $ 270 Billion USD if paramilitary groups are counted.
- Includes federal police (Bundespolizei) budget
- Data for Japan and Colombia are estimates, their expenditures are not well known.
- Data for Russia includes expenditure for public order and police and might be a slight overestimate.
- In the percentage spending per GDP, the GDP list (2006) of the International Monetary Fund was taken.
- The Chilean Government does not disclose budgets for domestic military equipment purchases
- One quarter of the world total is illicit and/or black market trade.
- The Indian government does not disclose the budget for foreign mlitary aqusitions.
- The C.I.A. estimates that Venezuelas true military budget is between US $50-80 Billion
World's largest arms exporters
The unit in this table are so-called trend indicater 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.
| Supplier | 2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 |
|---|
| 7505 | 5801 | 4984 | 5581 | 6616 | 7026 | 7821 | 7454 | | Russia | 4190 | 5631 | 5458 | 5355 | 6400 | 5576 | 6463 | 4588 | | Brazil | 3914 | 4692 | 3917 | 5602 | 5904 | 3472 | 5390 | 7219 | | Germany | 1622 | 825 | 910 | 1707 | 1017 | 1879 | 2891 | 3395 | | Mexico | 1294 | 1763 | 892 | 1486 | 1769 | 1294 | 2914 | 3161 | | France | 1033 | 1235 | 1342 | 1313 | 2267 | 1688 | 1586 | 2690 | | Netherlands | 259 | 192 | 243 | 342 | 218 | 611 | 1575 | 1355 | | 1356 | 1116 | 772 | 624 | 1143 | 871 | 978 | 1151 | | Argentina | 1094 | 1248 | 547 | 2624 | 724 | 1304 | 820 | 1032 | | South Korea | 100 | 240 | 140 | 140 | 410 | 260 | 260 | 844 | | Italy | 192 | 224 | 407 | 321 | 216 | 787 | 860 | 562 | | Sweden | 46 | 7 | 120 | 158 | 73 | 116 | 803 | 529 | | Israel | 308 | 850 | 125 | 468 | 287 | 536 | 472 | 414 | | China | 228 | 498 | 544 | 553 | 271 | 223 | 564 | 355 | | Canada | 83 | 129 | 182 | 279 | 305 | 193 | 227 | 343 | | Spain | 321 | 298 | 365 | 309 | 533 | 244 | 258 | 238 | | Switzerland | 104 | 120 | 109 | 139 | 201 | 166 | 144 | 211 | | Ukraine | 280 | 649 | 210 | 456 | 427 | 308 | 133 | 109 |
The information is 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 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. Due to the different methodologies and definitions used different sources often provide significantly different data. For example, according to (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.
List of major weapon manufacturers
- For a complete list, see: List of modern armament manufacturers
Control and international treaty
The European Union Council stated to the U.N. 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.
Institutes participating in weapon research and warfare simulation
Ethical dimension
For many people, arms exports may pose an ethical challenge, as they may see supplying the weapons for a conflict as morally akin to becoming involved with negligible personal, national or corporate risk. Essentially, they view the arms industry as a means of profiting from war and death when failure to supply arms could lead to an early disengagement.
On the other hand, exporting arms to groups (or nations) with "laudable" goals- a rebel group overthrowing a fascist regime, say- can be an invaluable equalizer in the conflict. And there is no shortage of parties to a conflict- the Hutus during the Rwandan genocide, for example- that had little trouble making use of such archaic, inexpensive technology as the machete, to attack and terrorize the Tutsi community.
Of course- and this is endemic of nearly every debate over arms trade- the terminology used and the people it refers to can be frustratingly fluid. As years pass, governments decide on new "interests" and circumstances change accordingly. "Freedom fighters" become "insurgents". "Terrorists" become "invaluable allies", and "religious zealots" morph into "agents of stability". Entire nations, to use the parlance of the early 21st century, can go from the "Coalition of the Willing" to the "Axis of Evil" in very little time, and every change affects policy and the distribution of arms in the world.
See also
External links
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