US corners 42 percent of world arms market

WASHINGTON: The United States reaffirmed last year its leadership in world arms trade, cornering nearly 42 percent of the market as the wars in Iraq and Afghanistan prompted a weapons shopping spree among neighboring nations, according to a congressional report set to be released on Monday.

However the overall volume of weapons trade shrunk almost 13 percent, dealing a blow to France and other Western European suppliers, which are facing stiff competition from across the Atlantic, said the Congressional Research Service in its annual survey of international arms sales.

The United States ranked first in international arms transfer agreements last year, concluding 16.9 billion dollars worth of them and securing 41.9 percent of the market, according to the report. The total represented a 3.4-billion-dollar increase over 2005.    

Russia boosted its worldwide arms sales by 1.2 billion dollars, ending 2006 in second place with a total of 8.7 billion dollars, or 21.6 percent of the market. Britain came in third, but its arms exports grew only 200 million over 2005 and the overall volume of arms transfer deals stood at just 3.1 billion dollars, less than a fifth of the US total.    

All told, the United States, Russia and Britain controlled last year more than 71 percent of international arms trade. But the size of the market has shrunk as major buyers took a pause to absorb previous purchases.

Worldwide weapons orders, according to the report, declined from 46.3 billion dollars in 2005 to 40.3 billion last year. Western European nations were among those hit hardest by the slump. The four major regional suppliers - France, Britain, Germany and Italy - saw the collective value of their arms agreements with developing nations drop by half - from 10.9 billion dollars in 2005 to 5.5 billion last year.    

Meanwhile, Western Europe's market share decreased, according to the report, from 34.4 percent to 19.1 percent. Richard Grimmett, the top national defense expert at the CRS and main author of the study, made it clear he saw growing competition from the United States as the main reason for the European Union's woes.    

"The demand for US weapons in the global arms marketplace, from a large established client base, has created a more difficult environment for individual West European suppliers to secure large new contracts with developing nations on a sustained basis," he wrote.  But Grimmett also noted a major shift in political and economic interests driving post-Cold War era international weapons sales. During the Cold War, he argued, the underlying rationale for US arms sales was to ensure adequate arms supplies to friendly states.    

"Today that motivation may be based as much on economic considerations as those of foreign or national security policy," the expert pointed out. But the wars in Iraq and Afghanistan, along with the traditional rivalry between India and Pakistan, seemed to be fueling regional arms races. Pakistan, a key US partner in the war on terror, ranked first last year among all developing world weapons purchasers after concluding 5.1 billion dollars worth of arms deals, the CRS said.    

India came in a distant second with 3.5 billion while Saudi Arabia, a nervous neighbor of Iraq and Iran, ranked third with 3.2 billion in arms agreements. The United States will be selling Pakistan, among other things, 36 upgraded versions of the F-16 fighter aircraft for 1.4 billion dollars, a variety of missiles and bombs for them for over 640 million, and 52 million dollars worth of upgrades for self-propelled howitzers.   

In Saudi Arabia, it will be modernizing the kingdom's AH-64A Apache helicopters, a deal worth 340 million, and providing new military communications equipment, the report said. Meanwhile, the United Arab Emirates are buying from Washington "Seasparrow" ship-to-air missiles for 106 million dollars.