The world is becoming more militarized.
President Donald Trump has requested a ten percent boost in defense spending, China will
have nearly doubled its military expenditures by the end of the decade, and — with the
impetuous Trump occupying the White House — conflict zones from the Korean Peninsula
to Syria seem more likely to descend into open warfare than they did under the vigilant
command of President Barack Obama.
So let’s take some time to review where the pieces on the board — the
weapons systems in this geopolitical game of chess — are coming from.
These are the top ten countries that export the most arms according to the authority on
this topic, the Stockholm International Peace Research Institute.
Before we begin, a few important points: the data does not include spending on support
services for these increasingly high-tech systems, which is now the dominant aspect
of military spending; companies — some state-owned — are the primary providers of these weapons;
and we’re using the average of the five most recent years to give the rankings more
stability.
Israel’s arms industry is ranked tenth.
Its exports surged above $1.2B for 2016, three times what it was just two years earlier.
Part of this is increased sales to India, Israel’s biggest customer.
Israel’s Aerospace Industries just finalized a deal worth $2B to provide India air and missile
defense systems.
Ninth is Ukraine.
Naval vessels were its primary military export until a contract with the Chinese dried up
in 2015.
Despite its ongoing conflict with Russia, Ukraine continues to sell it more and more
arms.
Aside from Thailand, the Indians and Vietnamese are also regular customers.
Italy, the world’s eighth-leading arms exporter, does regular business with the United Arab
Emirates.
Leonardo S.p.A.
— Italy’s leading defense contractor — recently cut a deal to sell the UAE eight of its brand
new P.1 “Hammerhead” Unmanned Aerial Vehicles for $347 million.
Seventh is Spain.
It’s defense industry is concentrated heavily around two key markets: aviation and shipbuilding.
State-owned Navantia is in the midst of delivering three Hobart-class destroyers to the Royal
Australian Navy.
The first of the 147.2 meter ships is currently conducting sea trials as it nears completion.
The UK is the world’s sixth-ranked arms manufacturer.
It’s largest defense contractor, BAE Systems, is the third-largest in the world.
It’s supplied The Royal Saudi Air Force with 72 Eurofighter Typhoons as part of a
deal that guarantees the UK government 600,000 barrels of Saudi Arabian oil a day.
The Germans have slipped from third to fifth in the last five years as Chancellor Merkel’s
government has blocked the sale of certain weapons systems to countries with questionable
human rights records like Turkey, Qatar, Saudi Arabia, and Brunei.
Instead, it's selling more to allies like South Korea and Greece.
Like the Germans, fourth-ranked France’s arms exports also declined during the last
five years.
President Francois Hollande came under heavy pressure from his NATO allies to cancel the
sale of two Mistral-class amphibious assault ships to the Russians due to the crisis in
Ukraine.
Those ships instead were sold to Egypt.
China’s third-ranked defense industry is surging, rising from the sixth position just
five years ago.
The Chinese understand that in geopolitics, controlling the sale of military hardware
is often a government’s most valuable bargaining chip.
What’s interesting is the Chinese don’t — or can’t — make sales to its global
rival, the United States, or its regional rival, India.
The only NATO nation China has ever exported arms to is Turkey, but even that stopped in
2013.
Russia is second.
Its main customer, India, now buys just half as many Russian made weapons systems as they
were buying five years ago and, overall, Russia’s arms sales are down 30% from their peak.
After Putin’s actions in eastern Ukraine, the US, NATO, and their allies used a combination
of tools, including sanctions, to punish Russia.
But what this data seems to reveal is that their main game plan was leveraging their
vast, combined network of weapons manufacturers to successfully block Russian companies from
making large arms sales.
Weapons account for 2.6% of Russia’s total exports, that’s by far the largest share
of any country on this list, so its economy was extremely vulnerable if weapons exports
took a big hit.
So when Russia’s economy entered a tailspin in 2015, it was clear this strategy had worked.
And the top weapons exporter is, of course, the United States.
Six of the ten largest defense contractors are American including the top two: Lockheed
and Boeing, which sell more than $60B in arms each year.
Regardless of how you feel about America’s military industrial complex, it’s important
to understand that dominating the world’s arms trade gives the United States tremendous
bargaining power to leverage and mold the affairs of the rest of the world.
Thanks for watching.
I hope this provided some valuable background on some of the issues in the news.
Our previous video started some interesting debate about whether it's best to expend resources
exploring near or distant space.
Until next time, for TDC, I’m Bryce Plank.