Arms industry

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The arms industry is a massive global industry and business which manufactures and sells weapons and military technology and equipment. Defense companies 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 and arms worldwide. ^[1] In 2004 over $30 billion were spent in the international arms trade (a figure that excludes domestic sales of arms)^[2] 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. Sometimes legally purchased weaponry is re-sold for illegal purposes.

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.^[3] Russia is the world's top supplier of weapons, a spot it has held since 2001, accounting for around 30% of worldwide weapons sales, followed by the United States, France, Germany and Britain.^[4][5]

The Control Arms Campaign, 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.^[6]

[edit] Sectors

[edit] 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. ^[7]

[edit] 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 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. ^[8]

[edit] 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. ^[9]

[edit] World's largest defense budgets

This is a list of the fifteen countries with the highest defense budgets for the year 2006. The information is from the Stockholm International Peace Research Institute, ^[10] Total World spending amounted to $ 1,158 billion USD in 2006, with nearly half of the total amount spent by the United States.

• Note 1: data for China and Russia are estimates, their expenditures are not well known.
• Note 2: data for Iran and Saudi Arabia include expenditure for public order and safety and might

be slight overestimates.

• Note 3: in the percentage spending per GDP, the GDP list (2006) of the International Monetary Fund was taken.

[edit] World's largest arms exporters

The information is from the Stockholm International Peace Research Institute

[edit] List of major weapon manufacturers

For a complete list, see: List of modern armament manufacturers

[edit] 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.^[11]

[edit] Institutes participating in weapon research and warfare simulation

• Netherlands Organisation for Applied Scientific Research [2]
• Bolt, Beranek and Newman
• QinetiQ
• World Security Institute

[edit] See also

• Small arms proliferation
• European Union arms embargo on China
• List of National Defense Industries
• Private military contractors
• Campaign Against Arms Trade
• Canadian Arms trade
• List of countries by military expenditures
• Permanent arms economy
• Military funding of science
• Military Keynesianism
• Peace dividend
• Guns versus butter theory
• Al Yamamah arms deal
• Arms control

[edit] References

1. ^ www.globalissues.org
2. ^ BBC
3. ^ www.sipri.org
4. ^ http://www.abc.net.au/news/newsitems/200606/s1661277.htm
5. ^ http://www.canada.com/nationalpost/news/story.html?id=2d383264-f486-4305-9336-d6178d88f3b2&k=70609
6. ^ www.oxfam.org.uk
7. ^ www.fpa.org
8. ^ www.fpa.org
9. ^ www.fpa.org
10. ^ [1]
11. ^ http://www.europa-eu-un.org/articles/en/article_7338_en.htm

[edit] External links

• Defense Sector Investment Benchmark - SPADE Defense Index (AMEX: DXS)

• World Security Institute's Center for Defense Information
• Campaign Against Arms Trade (UK)
• SIPRI arms industry reports and database
• SIPRI list of Top 100 arms-producing companies
• The Guardian's arms trade report
• List of participators of the Defense System and Equipment international conference in London, 2003
• FAS's Arms Sales Monitoring Project
• UN Department for Disarmament Affairs
• ControlArms.org
• Amnesty International: Arms Trade Treaty
• The British Library - finding information on the defense industryde:Rüstungsindustrie

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