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Tri-Valley Communities Against a Radioactive Environment
June 2, 2022
U.S. Remains Largest Supplier To a Shrinking Arms Market
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Wade Boese

IN 1997, the United States once again led all arms exporters in deliveries and new agreements for conventional weapons in a still-shrinking world arms market, according to an annual Congressional Research Service (CRS) report released July 31. France, however, replaced the United States as the leading signer of new agreements with developing countries.

Worldwide arms sales agreements in 1997 declined to $24.2 billion (all figures in constant 1997 dollars), the lowest amount in the eight years covered by the report, Conventional Arms Transfers to Developing Nations, 1990–1997, authored by Richard F. Grimmett. The 1997 total represented less than half the value of the world market at the end of the Cold War in 1990 ($49.7 billion).

At the same time, however, global deliveries rose to $34.6 billion in 1997, an amount second only to the 1990 total of $48.6 billion. The United States delivered $15.2 billion worth of weapons in 1997 (up $6 billion from 1996), more than the United Kingdom ($5.9 billion), France ($4.9 billion), Russia ($2.4 billion) and China ($1 billion) combined. Grimmett attributed the climb in U.S. deliveries to implementing orders placed during and after the Gulf War.

As in all previous eight years except 1995, the United States contracted the most worldwide agreements, $5.3 billion in 1997, down from $8.5 billion in 1996. The CRS report excluded U.S. commercial agreements—the United States is the only major supplier with two separate export systems (commercial and government-to-government)—so U.S. totals are underreported. However, according to Grimmett, government-to-government sales make up the "overwhelming portion" of U.S. agreements.

Russia, whose primary arms customers are rivals China and India, also saw the value of its global agreements drop, from $4.4 billion in 1996 to $4.1 billion, while the United Kingdom's agreements fell from $4.9 billion to $1.6 billion. France, however, moved into second place behind the United States as Paris increased its arms deals to $5.1 billion, of which $4.6 billion were with developing nations. In comparison, the U.S. total of arms deals with developing nations fell to an eight-year low of nearly $2.3 billion. China, described as recently becoming more of a major arms purchaser, signed sale agreements worth $1.5 billion in 1997.

Developing nations continued to be the largest buyers of arms in 1997, signing deals valued at nearly $17.2 billion (71 percent of the total) and receiving weapons worth almost $28.6 billion (82 percent of the total). The United Arab Emirates tallied the highest total for 1997 agreements signed (with $3.5 billion), while Saudi Arabia imported $11 billion in weapons.

Regionally, the Near East and Asia combined for 89.9 percent of all agreements signed with developing countries and 92.5 percent of arms received for the period 1994–1997. But states in both regions recently deferred or canceled major arms purchases as a consequence of falling oil prices and the Asian financial crisis. Supplier nations have responded by seeking new markets in Eastern Europe (largely due to NATO expansion) and Latin America, but these nations possess little purchasing power and will not supplant the Near East and Asia as the primary weapons buyers.

In the near future, Grimmett concludes that the combination of developing nations with limited resources to spend on weaponry and the necessity of most supplier nations for cash payment will temper any "significant expansion of the arms trade." Instead, much of the market will be maintaining and upgrading previously supplied equipment.