Proposed U.S. Arms Export Agreements From January 1, 2008 to December 31, 2008

Press Contact: Jeff Abramson, Research Analyst; (202) 463-8270 x109

Updated: March 2009

During 2008, the Pentagon notified Congress of an estimated $75.4 billion in proposed, government-to-government, conventional arms transfer agreements with 25 countries, Taiwan, and an international consortium made up of NATO allies together with Sweden and Finland.

The United States conducts government-to-government transfers through the Defense Department’s Foreign Military Sales (FMS) program. Not all notified sales result in final transactions. Under the 1976 Arms Export Control Act, Congress must be notified of proposed sales of “major defense equipment,” as defined on the U.S. Munitions List, that equals or exceeds $14 million; defense articles and services that are not defined as “major defense equipment” which total $50 million or more; and construction or design services amounting to or surpassing $200 million.[1] However, if the proposed sale involves NATO members, Australia, Japan, South Korea, or New Zealand, the notification thresholds are $25 million for major defense equipment, $100 million for other defense articles and services, and $300 million for construction or design services.[2] Once notified, Congress has 30 calendar days (15 in the case of NATO members, Australia, Japan, South Korea, and New Zealand) to block a sale by passing a joint resolution of disapproval, though it has never stopped a sale once formally notified.

The proposed 2008 arms sales total was the highest in more than ten years, nearly twice the sums of 2007 ($39 billion) and 2006 ($37 billion) and nearly six times the 2005 total ($12 billion). Eight countries requested more than a billion dollars worth of U.S. arms. They were Australia, Iraq, Israel, Romania, Saudi Arabia, Taiwan, the United Arab Emirates (UAE), and the United Kingdom.

Countries in the Middle East accounted for more than half the total value of proposed sales, with Israel, Iraq, and the United Arab Emirates making the three largest requests worldwide. Potential sales to Israel rose from $2.5 billion in 2007 to more than $20 billion in 2008, including a $15.2 billion proposal for up to 75 F-35 Joint Strike Fighter aircraft and associated equipment. Israel's request for large military craft also included C-130J-30 transport aircraft and and Littoral Combat Ships. Although of lesser monetary value, Israel identified interest in thousands of small diamter bombs, and tens of thousands of anti-tank weapons and training rockets. Iraq's $18.7 billion in possible purchases, up from $4.45 billion in 2007 and $2.25 billion in 2006, included a wide arrange of military items, as well as technical and constuction assistance. Combat-oriented equipment listed in the notifications included M1A1 tanks, light armored vehicles, armed helicopters, Hellfire and other missiles, coastal patrol boats, and more than 100,000 assault rifles. Potential sales to the United Arab Emirates were valued at just more than $9 billion, down from $10.4 billion in 2007. Similar to 2007, the 2008 request included many missile and anti-missile systems, as well as the first foreign sale of Terminal High Altitude Area Defense fire units. Other requests by Middle Eastern states came from Saudi Arabia ($2.86 billion), Turkey ($580 million), Egypt ($564 million), Kuwait ($506 million), Qatar ($400 million), and Jordan ($390 million).

Taiwan's potential purchases of $6.4 billion, nearly twice the 2007 value of $3.72 billion, included hundreds of Patriot missiles, 30 Apache attack helicopters and 1,000 Hellfire missiles. Despite protests by Chinese officials, Congress did not alter this or any of the notified sales in 2008.

For the first time this decade, Romania joined the group of top countries requesting U.S. arms, proposing the purchase and upgrade of dozens of F-16C/D aircraft.

Below are the five countries that sought the highest values in U.S. arms exports in 2008 and some of their specific requests.

ENDNOTES

1. The Department of State is also required to report to Congress any commercial sales it approves of “major defense equipment” that amount to $14 million or more, defense articles and services that equal or exceed $50 million, and any items defined as “significant military equipment.” As in the case of FMS sales, Congress can block the sale with a joint resolution of disapproval within 30 calendar days of notification (15 in the case of NATO members, Australia, Japan, and New Zealand). There are no official compilations of commercial agreement data and it is often incomplete and less precise than data on government-to-government transactions (Grimmett, Richard F., Conventional Arms Transfers to Developing Nations, 1999-2006, Washington, D.C., Congressional Research Service, September 26, 2007, p. 20). The annual Section 655 report, prepared by the State and Defense Departments for Congress, details commercial licenses approved, but states have four years to act under the licenses. The State Department’s Office of Defense Trade Controls has final responsibility for license applications for commercial defense trade exports and all issues related to defense trade compliance, enforcement, and reporting.

2. Congress approved the higher notification thresholds for NATO members, Australia, Japan, and New Zealand in legislation passed in September 2002. In October 2008, Congress added South Korea to this list.

Sources: Congressional Research Service, Defense Security Cooperation Agency, and Department of State.