Commercial Arms Export Licenses Reported

The State Department issued approximately 45,000 commercial arms export licenses to 143 countries, territories and international organizations during fiscal year (FY) 1998, according to a July report sent to Congress. The licenses total $26.4 billion and are valid for four years. During FY 1997, the State Department authorized $24.7 billion in commercial licenses.

The United Kingdom and Japan, with $3 billion and $2.9 billion in licenses respectively, led all other countries in the value of licenses received. Seven other countries—South Korea, Turkey, Singapore, Finland, Australia, Germany and Israel—each tallied more than $1 billion in U.S. munitions list licenses. NATO members accounted for approximately 45 percent ($12 billion) of the licenses.

Other potential buyers included China, which contracted for $3.5 million in manufacturing and technical assistance, and Russia, which secured licenses worth $90 million for similar assistance and for satellite equipment. All commercial licenses for India and Pakistan were revoked following their nuclear tests in May 1998.

The State Department released its license authorizations in early July as part of the mandated "Section 655" report, which the departments of State and Defense are supposed to submit to Congress by February of each year. The Pentagon delivered its half of the report on Foreign Military Sales (FMS) and other Pentagon programs to Congress on February 9. The United States is the only country that has two separate systems, FMS and commercial, for exporting arms.