09/22/2004, 00.00
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Arms sales to largest market drop

The Middle East still remains largest market for weapons. In eight years arms sales totalled US$ 59 billion.

Beirut (AsiaNews/DS) – When one thinks of trade in the Middle East oil comes to mind right away but one should not forget the lucrative arms trade. What is more, if instability makes people and countries buy weapons, arms manufacturers love instability, and therefore it comes as no surprise that in a report by the Congressional Research Service (CRS) presented to the US Congress in August the Middle East –one of the world's most unstable region–was classified as the largest market for conventional weapons.

Added up, total sales of weapons in the region reached almost US$ 59 billion between 1996 and 2003. However, the market has remained stable or showed some slight decline after 2001, a trend that should not change anytime soon.

The CRS report states that the US was the largest arms supplier with sales worth US$ 34.9 billion or 59.6 per cent of the total with France coming in second at US$ 7.4 billion and 12.6 per cent respectively. The 1990-1991 Gulf war explains rising arms sales. The crisis that ended in operation "Desert Storm" pushed regional powers like Saudi Arabia, Kuwait, the United Arab Emirates (UAE) and other members of the Gulf Cooperation Council to buy new and more advanced weapon systems. Egypt and Israel, too, played an important role in sustaining the trend by constantly modernising their weapon systems especially by way of purchases from the US.

As important as Iraq's invasion of Kuwait was, the report reiterates that it was not the only factor behind the rising demand for arms; the perception of Iran as a potential threat to its neighbours was another.

Overall, the Middle East accounted for 44 per cent of all arms sales to the developing world between 1996 and 1999 ahead of Asia (36.8 per cent). In 2000-2003, its market share dropped by 28 per cent down to 37 per cent with Asia becoming the largest market for weapons.

The region's largest buyer Saudi Arabia was partly responsible for the drop in demand. The kingdom's acquisitions went from US$ 6 billion in 1996-1999 to US$ 3.4 in 2000-2003, a 43 per cent decline. Over this eight-year period, the US was its main supplier with sales worth US$ 7.3 billion or 77 per cent of the total.

The UAE bucked Saudi Arabia's trend and increased instead its arms purchases which went from US$ 7.6 billion in 1996-1999 to US$ 8.1 in 2000-2003. Over these two four-year periods the Emirates led the developing world in arms purchases with 10.4 per cent of the total. For Jeremy Binny, an arms specialist and journalist at the London-based Jane's Defence Weekly, "there are doubts that the UAE has the manpower to run all the equipment they have purchased". Among the weapons systems they bought there are Apache helicopters, F-16s jet-fighters, French tanks and a heavily equipped navy.

Significantly, the UAE switched suppliers from one period to the next. From 1996 to 1999 they bought arms worth US$ 6.1 billion (80 per cent of US$ 7.6 billion) from western Europe (France, Great Britain, Germany, Italy) with the US getting a mere US$ 200 million worth in contracts. By contrast, in 2000-2003 they signed deals worth US$ 7.1 billion with the US (87 per cent of the total) compared to only US$ 300 million with Western Europe. The UAE also put in orders to Russia worth US$ 400 millions for each period.

Egypt is the third largest arms buyer in the developing world and the second largest in the Middle East. From 1996 to 2003 it spent US$ 13.6 billion on weapons just US$ 100 million shy of second place China. But the Egyptian case is a special one because, following the peace treaty with Israel, it has been the second largest recipient of US military assistance after Israel. As Binny points out "every year, Egypt receives a voucher of approximately US$ 2 billion from the United States, which only allows it to purchase American weaponry." For him, "it is a sort of indirect subsidy for the American weapons industry that also allows the American government to build strong ties with strategic nations." However, he adds that "Egypt quickly uses that voucher every year because its government doesn't know how long the United States will continue to provide such military aid."

With expenditures worth US$ 9.9 billion Israel was the third largest arms buyer in the region in the eight-year period. Like Egypt, the Jewish state profits from a special deal with the US. And for this reason, 94 per cent of its arms purchases are done in the US.

In 2000-2003 Algeria, the UAE and Yemen were the main buyers of Russian weaponry with contracts worth US$ 400 million each. Egypt followed with US$ 300 million, Iran and Syria with US$ 200 million each.

China's main clients were Egypt and Kuwait with US$ 200 million and Iran and Yemen with US$ 100 million.

Saudi Arabia signed contracts worth US$ 500 million with Western Europe's four main powers followed by Oman and the UAE (US$ 400 million each).

Arms suppliers from other European countries sold weapons for US$ 300 million to the UAE and US$ 200 million to Saudi Arabia.

Suppliers from the rest of the world found a ready client in Libya (US$ 300 million), Kuwait (US$ 200 million) and Jordan (US$ 200 million).

Between 1996 and 2003 Russia delivered 70 tanks and self-propelled guns, 150 Armoured Personnel Carriers (APCs) and armoured cars, 30 supersonic combat aircraft, 50 helicopters, 880 surface-to-air missiles, and 30 anti-ship missiles.

The United States delivered 276 tanks and self-propelled guns, 46 APCs and armoured cars, 26 supersonic combat aircraft, 14 helicopters, 374 surface-to-air missiles, and 63 anti-ship missiles

China delivered 40 APCs and armoured cars, 1 guided missile boat, and 20 anti-ship missiles.

The four major West European suppliers collectively delivered 290 tanks and self-propelled guns, 4 major surface combatants, 27 minor surface combatants, 4 guided missile boats, 1 submarine, 30 helicopters, and 90 anti-ship missiles.

All other European suppliers delivered 420 tanks and self-propelled guns, 220 APCs and armoured cars, 1 major surface combatant, 9 minor surface combatants, 20 supersonic combat aircraft, and 380 surface-to-air missiles.

Suppliers fro the rest of world collectively delivered 120 APCs and armoured cars, 48 minor surface combatants, 20 helicopters, 20 surface-to-surface missiles, and 20 anti-ship missiles.

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