Global arms sales see an increase during the pandemic

Monitoring international official arms transfers, the Stockholm International Peace Research Institute (SIPRI) has released a fact sheet on the top 100 arms-producing and military services companies in 2020.

The fact sheet has revealed that the arms sales of the SIPRI Top 100 arms-producing and military services companies totalled 531 billion US dollars in 2020, a 1.3-percent increase compared with 2019.

The SIPRI has found that “global arms production proved to be largely resilient against the novel coronavirus (COVID-19) pandemic and resulting economic downturn”, noting that “there were differences in impact between industry sectors and between individual companies.”

“While the global economy contracted by 3.1 percent in 2020, the aggregated arms sales of the Top 100 increased,” the fact sheet has underlined, attributing this situation to at least three key factors:

First, the arms industry, like many other economic sectors, benefited from expansionary fiscal policies during the first year of the pandemic. Military manufacturers were largely shielded by sustained government demand for military goods and services.

Second, some states rolled out specific measures to mitigate the effects of government-mandated lockdowns on their arms companies, such as accelerated payments or order schedules.

Third, because arms procurement contracts usually span several years, many arms companies were able to make gains on orders placed before the outbreak of the health crisis.

Details from around the world

Some of the country-based key facts from the fact sheet are as follows:

Taken together, the arms sales of the 41 companies in the Top 100 based in the US increased by 1.9 percent to 285 billion US dollars. These US companies accounted for 54 percent of the Top 100’s total arms sales in 2020.

The combined arms sales of the five Chinese companies listed in the Top 100 were 66.8 billion US dollars, an increase of 1.5 percent on 2019. These Chinese firms made up 13 percent of total Top 100 arms sales in 2020.
The Top 100 lists 26 companies based in Europe. Their combined arms sales amounted to 109 billion US dollars in 2020, an increase of 1 percent on 2019. Together, these European companies accounted for 21 percent of total Top 100 arms sales.

The combined arms sales of the nine Russian companies listed in the Top 100 declined by 6.5 percent to 26.4 billion US dollars in 2020. Their share of the Top 100’s total arms sales was 5 percent in 2020.

Details about Turkey: Aselsan

According to the fact sheet, “collectively, the arms sales of companies in the Top 100 based outside the USA, China, Russia and Europe totalled 43.1 billion US dollars in 2020—an increase of 3.4 percent on 2019. This represents 8.1 per cent of the total arms sales of the Top 100.”

The SIPRI has noted that “five of these companies are based in Japan, four in South Korea, three each in Israel and India, and one each in Canada, Singapore, Turkey and the United Arab Emirates (UAE).”

Referring to the Aselsan, Turkey’s defense corporation headquartered in the capital city of Ankara, the SIPRI fact sheet has said: “Aselsan (ranked 51st) is based in Turkey and had arms sales of 2.2 billion US dollars in 2020, an increase of 12 percent on 2019.”

In the previous SIPRI report, Aselsan ranked 53rd.