Sales of arms and military services by the largest arms-producing companies—the SIPRI Top 100—totaled $395 billion in 2012 according to new data on international arms production launched today by Stockholm International Peace Research Institute (SIPRI) at the Munich Security Conference.
This result represents a 4.2 per cent decrease in real terms compared to the companies in the Top 100 for 2011 and follows a 6.6 per cent decrease in that year. Arms sales by the Top 100 have nevertheless increased by 29 per cent in real terms since 2003.
However, the decrease in arms sales in 2012 was not uniform: while sales by companies in the United States, Canada and most West European countries continued to fall, arms sales by Russian companies increased sharply, by 28 per cent in real terms.
The share for companies outside North America and Western Europe has also been increasing since 2005 and, at 13.5 per cent, is at its highest point in the history of the Top 100, which does not include China-based companies due to lack of available data.
Rapid rise in Russia due to domestic procurement plans
Russian companies saw a particularly large increase in estimated arms sales in 2012. Of the 6 Russian companies in the Top 100, all except United Aircraft Corporation saw increases in excess of 20 per cent, and Almaz Antei—with a 41 per cent rise—now stands in 14th place in the Top 100, the highest position taken by a Russian company since data became available in 2002.
Russian arms companies continue to maintain high export levels, but the increase in estimated arms sales in 2012 mainly reflects large and growing domestic sales, as part of Russia’s $700 billion 2011–20 State Armaments Plan. While there remains widespread scepticism as to whether the aims of the plan can be fully achieved, it is clear that a major increase in Russian military equipment procurement is taking place.
‘The Russian arms industry is gradually re-emerging from the ruins of the Soviet industry’, said Dr Sam Perlo-Freeman, Director of SIPRI’s Military Expenditure and Arms Production Programme. ‘Nonetheless, the industry is still plagued by outdated equipment, inefficient organization and widespread corruption, which will continue to limit Russia’s ability to compete technologically with the West.’
For more on this story, visit: 31 Jan. 2014: Sales by largest arms companies fell again in 2012 but Russian firms’ sales increased sharply — www.sipri.org.