Arms Trade

The arms trade. The defense industry. The ability to defend our borders. Whatever term you use, there’s a huge market for weapons – and I mean huge. The world spends some $1,000 billion annually on the military; some 40 to 50 billion dollars are in actual deliveries, (that is, the delivery of sales, which can be many years after the initial contract is signed), and each year, around 50 to 60 billion dollars are made in actual sales (agreements, or signing of contracts).

India has been the main importer of weapons in the last five years, as the region races to arm itself ahead of its regional rivals: China and Pakistan. The high levels of Indian imports are also the result of its small domestic arms industry, which means it has to buy weapons from overseas.

The US was by far the top arms exporter in 2011-15, with a 33 per cent share of the global market. Exports from the US have increased 27 per cent in the last five years.

Saudi Arabia is its biggest customer, and aircraft are its biggest product. As of the end of 2015, the USA had numerous outstanding large arms export contracts, including contracts to supply a total of 611 of its new generation F-35 combat aircraft to nine states.

What we don’t often hear is what is sold around the world. I don’t pretend to understand the technical capacity of these units, but I know they’re heavy’going pieces of hardware, as well as scary pieces as well. So, let me list the ways they scare me …

  • Tanks and Self-propelled Guns
  • Artillery (including mortars, rocket launchers, and recoilless rifles of 100 mm and over)
  • Armored Personnel Carriers (APCs) and Armored Cars
  • Major Surface Combatants (Aircraft carriers, cruisers, destroyers, and frigates)
  • Minor Surface Combatants (Minesweepers,motor torpedo boats, patrol craft, and motor gunboats)
  • Submarines
  • Guided Missile Patrol Boats
  • Supersonic Combat Aircraft
  • Subsonic Combat Aircraft
  • “Other” Aircraft (fixed-wing aircraft, including trainers, transports, and reconnaissance aircraft)
  • Helicopters
  • Surface-to-air Missiles
  • Surface-to-surface Missiles
  • Anti-ship Missiles

Terrified yet? I am a little bit, I don’t mind admitting it; the fact that these massive armaments can be traded and dealt in the same way as meat, televisions, or ideas is worryingly easy. The bureaucracy side is actually fairly simple, and then Bob’s your uncle.

So how do you become an arms dealer? With frightening ease. Say you want to sell to a foreign government; you might go to their embassy and start a dialogue. There are usually 2 ways this approach can go:

They direct you to an onsite military attache representative. This is the tricky part because now you need to tell them you have a product. Before you panic at your lack of product, this is where you need to do some research, find arms companies/suppliers, make some contacts and say you represent a foreign buyer, keep it vague, take a look at inventory, get a card or two. Say you’ll  be back. Give your potential buyer / military attache a catalogue (make your own) containing the products sold by all the suppliers you’ve talked to, let your potential buyer browse, and adjust the prices to give you some mark-up. If the attache chooses to buy, they’ll pay you, then you pay the suppliers – minus, of course, your profit.

Oh, and the government pays for shipping as well, if they don’t have the capacity to handle it themselves. You can add on a decent mark-up for this as well, so more chances for profit. Yippee!

However, suppose the embassy approach doesn’t work? This where you need to do a bit of homework. Look round for some high-ranking military officials of whatever country you choose. Send them an email with a pitch or digital catalogue, asking to be directed to an appropriate representative. You could either ask them to instruct an embassy official to work out a sales order and payment, or do it directly.

Yes, it really is that depressingly easy; you can go from nothing to a successful international arms dealer with little more than some negotiation skills.

One thing I haven’t mentioned yet is cyber-security; this is an increasing area of expertise, and it’s fast becoming the most important defence industry; a 2013 NATO review argued that this was one of the greatest risks to defence in the coming decade. As a result, a lot of investment is being funnelled into the industry (it’s estimated that government protection and buying power will make up 40% of the industry), to produce new software that’s focused on protecting the ongoing transition to digital services. The military complex needs a hell of a lot of protection for its reconnaissance, surveillance, and intelligence gathering systems. There are advanced cyber protection strategies used such as content, cloud and wireless security. These blend together to form several secure layers that the average person in the street – me being the perfect example – wouldn’t have a clue about.

It’s an continuing – aha – battle between the military and cyber attackers, who are becoming increasingly advanced. They use techniques such as the Dynamic Trojan Horse Network (DTHN) Internet Worm, Zero-Day Attack, and Stealth Bot. As a result, the cyber-security industry has had to develop systems such as the Security of Information (SIM), Next-Generation Firewalls (NGFWs), and DDoS techniques. Means nothing to me, but sounds fascinating.

There are a lot of criticisms aimed at the industry, justifiably so, and I consider myself to be a fairly harsh critic of this regime – although not as critical as the brilliant Mark Thomas, who is an activist and comedian. If you’ve never heard of him before, google him; he’s incredibly interesting.

Onto the criticisms; they seem to form around six main themes:

  1. The arms firms have been active in fomenting war scares, and in persuading their countries to adopt warlike policies and to increase their armaments.
  2. They have attempted to bribe government officials, both at home and abroad.
  3. They have disseminated false reports concerning the military and naval programs of various countries, in order to stimulate armament expenditure.
  4. They have sought to influence public opinion through the control of media in their own and other countries.
  5. They have organised international armament rings through which the arms race has been accentuated by playing off one country against another.
  6. They have organised arms trusts which have increased the price of armaments sold to governments.

Since the early 1990s, there has been efforts to review and develop ethical principles and codes of conduct to ensure that arms are not sold to human rights violators. Common themes in such codes include:

  • Not selling arms to non-democratic regimes, or regimes that will use weapons to commit human rights abuses.
  • Not selling weapons where internal or external conflicts may be fueled.
  • Not selling weapons that could undermine development and increase poverty.

While this sounds positive, the world’s major arms dealers have continued to sell arms to human rights violators, and the codes aren’t as effective as they should be for a number of reasons;

  • Divergent standards
  • Divergent interpretation and implementation
  • Weak or diluted codes
  • Corruption and pressure to dilute codes further.

The arms industry is unlike any other. It operates without regulation. It suffers from widespread corruption and bribes. And it makes its profits on the back of machines designed to kill and maim human beings. So who profits most from this murderous trade? The five permanent members of the UN Security Council – the USA, UK, France, Russia, and China. Together, they are responsible for 88% of reported conventional arms exports. However, they can’t have it both ways. They can’t be both the world’s leading champion of peace and the world’s leading supplier of arms.

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