Global arms sales rise for 7th year despite supply chain issues

Annual report on weapons commerce reveals gross sales up 1.9 p.c, with Russia’s invasion of Ukraine including to provide chain issues.

Russia's invasion of Ukraine has elevated demand for weaponry but in addition created issues [File: Dimitar Dilkoff/AFP]

Gross sales of arms and navy companies by the world’s 100 largest defence corporations rose 1.9 p.c to $592BN in 2021 regardless of provide chain points that held up shipments of crucial elements, in keeping with new information from the Stockholm Worldwide Peace Analysis Institute (SIPRI).

The rise, accelerating from 1.1 p.c in 2019-2020, marked the seventh consecutive yr of rising world arms gross sales, SIPRI mentioned in its Arms Trade Database launched Monday.

SIPRI mentioned provide chain points continued to carry again commerce in 2021 and have been more likely to worsen because of the Ukraine conflict.

“We'd have anticipated even higher progress in arms gross sales in 2021 with out persistent provide chain points,” Lucie Béraud-Sudreau, director of the SIPRI Navy Expenditure and Arms Manufacturing Programme, mentioned in a press release. “Each bigger and smaller arms corporations mentioned that their gross sales had been affected through the yr. Some corporations, corresponding to Airbus and Common Dynamics, additionally reported labour shortages.”

Russia’s invasion of Ukraine in February 2022 was additionally growing provide chain challenges for arms corporations around the globe, the SIPRI report mentioned.

For Western international locations, it famous that Russia was a big provider of the uncooked supplies utilized in arms manufacturing.

“This might hamper ongoing efforts in america and Europe to strengthen their armed forces and to replenish their stockpiles after sending billions of dollars’ value of ammunition and different gear to Ukraine,” it mentioned.

However Russia, which is growing manufacturing due to the conflict, can be affected due to war-related sanctions that make it troublesome for producers there to entry semiconductors and to obtain fee for his or her deliveries.

Corporations in america dominated the listing with gross sales of the 40 US corporations within the itemizing totalling $299bn in 2021, in keeping with SIPRI, though gross sales have been barely decrease in actual phrases because of excessive inflation.

Persevering with a sample established in 2018, the 5 corporations on the prime of the listing have been all based mostly within the US: Lockheed Martin, Raytheon Applied sciences, Boeing, Northrop Grumman and Common Dynamics.

However the report famous a big surge in gross sales from Chinese language producers, with the eight Chinese language arms corporations on the listing having complete arms gross sales of $109bn, a rise of 6.3 p.c from the yr earlier than. 4 of its producers have been within the High 10.

“There was a wave of consolidation within the Chinese language arms trade because the mid 2010s,” Xiao Liang, a researcher with SIPRI, mentioned in a press release. “In 2021 this noticed China’s CSSC turning into the most important navy shipbuilder on the earth, with arms gross sales of $11.1bn, after a merger between two current corporations.”

South Korean producers additionally noticed above-average progress in gross sales, with the 4 corporations in SIPRI’s listing reporting mixed gross sales 3.6 p.c above the earlier yr at $7.2bn, led by engine producer Hanwha Aerospace. Its gross sales surged 7.6 p.c to $2.6bn and are anticipated to develop considerably within the coming years after it signed a significant arms take care of Poland earlier this yr.

France’s Dassault Aviation Group additionally registered sturdy progress, with gross sales up 59 p.c to $6.3bn in 2021, pushed by deliveries of 25 Rafale fight plane.

Elsewhere in Europe, nevertheless, corporations struggled with provide chain disruptions, with most navy aerospace corporations reporting losses.

There have been 27 corporations with headquarters in Europe within the prime 100; their mixed arms gross sales elevated by 4.2 p.c to achieve $123bn.

The six Russian corporations within the prime 100 noticed their gross sales rise by a marginal 0.4 p.c to $17.8bn.

“There have been indicators that stagnation was widespread throughout the Russian arms trade,” the report mentioned.

The SIPRI Arms Trade Database was created in 1989.

The present model incorporates information from 2002, and Chinese language corporations have been included since 2015.

This yr’s replace famous that non-public fairness corporations seemed to be shopping for up extra arms corporations, which may carry dangers for transparency as a result of they weren't required to be as open about their funds as publicly-listed corporations.