The US remains the ultimate: the armaments industry is flourishing despite the pandemic

USA remain the ultimate
Defense industry is flourishing despite the pandemic

Global arms production is proving to be quite resilient in the pandemic. Internationally, more money will be put into weapons in 2020 than in the previous year. While Germany is within the international average, arms spending in Russia is surprisingly falling.

The economic consequences of the pandemic have not torn a hole in the coffers of the world’s leading arms companies. On the contrary: The world’s 100 largest arms sellers sold armaments and military services worth $ 531 billion in 2020, a currency-neutral increase of 1.3 percent year-on-year. The Stockholm peace research institute Sipri announced in a report. Although it was the smallest increase in three years, it was the sixth annual increase in a row.

“Although the global gross domestic product fell by a good 3.1 percent in 2020, the armaments industry still managed to increase by 1.3 percent,” said the German-Austrian Sipri researcher Alexandra Marksteiner. It is true that the increase in arms sales is not as great as in previous years. “But we still interpret this as an indication that global arms production is proving to be quite resilient to the shock of the Covid-19 pandemic and the resulting economic downturn.”

A Sipri report published in the spring had already shown that the countries of the world put more money into their military apparatus than before, despite the 2020 pandemic. In large parts of the world, military spending has grown, said arms expert Marksteiner. Some governments have even accelerated their payments to the arms industry to cushion the effects of the corona crisis.

The downward trend in Russia continues

The US remains the ultimate in the international arms market. US corporations have consistently held the five top positions in the Sipri ranking since 2018. The 41 US-based companies in the top 100 sold weapons worth $ 285 billion in 2020, up 1.9 percent. That corresponded to a share of 54 percent of all sales among the top 100 companies. In second place is China with a share of around 13 percent, followed by Great Britain with 7.1 percent. Russia in fourth place did not experience any growth, in contrast to the top three countries, but a significant decrease of 6.5 percent. The downward trend since the peak in Russian arms sales in 2017 has thus continued.

Sipri identified two reasons for this year’s decline: On the one hand, the Russian state armament program came to an end in 2020. On the other hand, there are also some indications that the pandemic has had an impact here. Some Russian corporations should have postponed their arms deliveries – and if nothing is delivered, no payment is made. French companies also recorded a decline of 7.7 percent overall.

And Germany? With an overall increase of 1.3 percent, it is in line with the international average. At the same time, there are clear differences among the four German groups in the top 100: two recorded increases and two decreased. Armaments sales by Rheinmetall in 27th place and Hensoldt in 78th place grew by 5.2 and 7.9 percent, respectively, according to Sipri. The ship builder ThyssenKrupp (55th place), on the other hand, came to a minus of 3.7 percent, Krauss-Maffei Wegmann (70th place) to minus 7.5 percent. Overall, armaments sales by the four corporations this time amount to $ 8.9 billion.

The aircraft manufacturer Airbus is viewed by Sipri as a trans-European group. With an increase of 5.7 percent on arms sales of almost 12 billion dollars, the group rose from 13th to 11th place among the 100 leading arms companies military services to military customers at home and abroad. Since 2015, when Sipri first added data from Chinese companies to its report, the increase has been 17 percent.

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