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Tuesday, October 4, 2022

Global arms sales hit new highs amid pandemic: report

According to the Stockholm International Peace Research Institute (SIPRI), the top 100 arms dealers earned $ 531 billion in 2020.

Profits for 2020 marked the sixth straight year of growth and were 17 percent higher than in 2015, when SIPRI began tracking Chinese firms.

According to SIPRI, the 41 US contractors on the list sold the most weapons, generating $ 285 billion, up 1.9% from 2019. Of these, Lockheed Martin Corp., Raytheon Technologies, Boeing, Northrop Grumman Corp and General Dynamics Corp. during 2020, it accounted for a combined revenue of more than $ 180 billion, or about one third of all sales.

Chinese firms are the second most active, with the country’s five largest companies selling weapons worth $ 66.8 billion in 2020, up 1.5 percent from 2019, according to the Stockholm Institute for Conflict Research.

“In recent years, Chinese arms companies have benefited from the country’s military modernization programs and focused on civil-military mergers,” said Nan Tian, ​​senior fellow at SIPRI. “They have become one of the most advanced military equipment manufacturers in the world.”

SIPRI noted that arms sales from other Chinese companies could be high enough to make it into the top 100, but noted that there was not enough data to include them in the ranking.

The 26 European arms companies in the top 100 combined accounted for $ 109 billion in sales. For the seven largest UK firms, those sales were $ 37.5 billion, up 6.2 percent from 2019, with BAE System’s $ 24 billion dominating.

In contrast to growth in the United States, Europe and China, arms sales from Russia fell from $ 28.2 billion in 2019 to $ 26.4 billion in 2020.

“This is a continuation of the downward trend seen since 2017, when arms sales by Russian top 100 companies peaked,” SIPRI said in a statement.

“One of the steepest drops in arms sales among the top 100 companies was recorded by Russian firms. This coincided with the end of the State Arms Program for 2011-2020 and the delay in delivery due to the pandemic, ”the research center said.

Arms sales by companies in the top 100 outside the United States, China, Russia and Europe totaled $ 43.1 billion in 2020, up 3.4 percent from 2019, according to SIPRI.

SIPRI noted that in 2020 blockades disrupted the work of the arms industry.

“Thales, for example, attributes a 5.8% drop in arms sales to isolation-related disruptions in the spring of 2020,” SIPRI said in a statement. “Several companies also reported supply chain disruptions and supply delays.”

However, according to SIPRI, the increase in government spending more than offset the isolation-related failures.

“The industrial giants have been largely protected by strong government demand for military goods and services,” said Alexandra Marksteiner, researcher for the SIPRI defense spending and weapons program. “In many countries around the world, military spending has risen, and some governments have even accelerated payments to the military industry to mitigate the impact of the COVID-19 crisis.”

With the U.S. military budget for 2022 amounting to about $ 768 billion – an increase from $ 733 billion spent this year and $ 714 billion in 2020 – US contractors could see more revenue growth in future SIPRI reports.

Many national security officials are in favor of an indefinite 5 percent increase in military spending, both to support the global war on terror and to counter China and Russia.

However, critics argued that an uncertain 5 percent increase would soon spiral out of control, costing an additional $ 1.2 trillion over 10 years over the current long-term budget forecast.

Proponents of spending cuts have called on policymakers to follow a recent report by the Congressional Budget Office (CBO), which says the Pentagon could save $ 1 trillion over 10 years by cutting active military personnel while conserving reserves, reallocating global resources from relatively safe areas where perceived threats are located and rely more on alliances.

“The new CBO report marks a refreshing departure from calls for more Pentagon spending emanating from Capitol Hill and outlines practical steps to achieve real cuts in military spending,” William Hartung, director of the Arms and Security Program at the Center for International Relations Politics, said when the report was published in October. “This should mark the beginning of a debate about how much to cut the Pentagon’s budget, not whether to do it.”

To follow

Ken Silva covers national security issues for The Epoch Times. His reporting experience also includes cybersecurity, crime and offshore finance – including three years as a reporter in the British Virgin Islands and two years in the Cayman Islands. Contact him at [email protected]

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