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World arms sales fall to $597B despite surge in demand, report shows

5 December 2023 08:00 (UTC+04:00)
World arms sales fall to $597B despite surge in demand, report shows

Revenues from sales by the world's top 100 arms producers dropped by 3.5% to $597 billion in 2022, compared to a year earlier, despite the sharp rise in demand, an international think tank report showed on Monday, Azernews reports, citing Anadolu Agency.

The decline was mainly led by falling arms revenues among major companies in the US, the Stockholm International Peace Research Institute (SIPRI) said in its report.

Global arms revenues are expected to surge in the next few years due to “outstanding orders and a rise in new contracts,” the report said.

Despite the growing demand for weapons and military equipment which was fueled by the Russia-Ukraine war and geopolitical tensions in 2022, companies struggled to boost their production capacity due to labor shortages, soaring costs and supply chain disruptions.

"Many arms companies faced obstacles in adjusting to production for high-intensity warfare," said Lucie Beraud-Sudreau, director of SIPRI’s Military Expenditure and Arms Production Program.

Sudreau stressed that that newly signed contracts, notably for ammunition, are expected to translate into higher revenue in 2023 and beyond.

Dominating the top 100 with a 51% share, the arms revenues of the 42 US companies dropped by 7.9% year-on-year to $302 billion in 2022.

The figure for 22 companies from Asia and Oceania listed in the ranking grew 3.1% to $134 billion in 2022.

"Domestic demand and reliance on local suppliers shielded Asian arms companies from supply chain disruptions in 2022," said Xiao Liang, a researcher with the SIPRI Military Expenditure and Arms Production Program.

The 4 Turkish companies’ total arms revenues amounted to $5.5 billion in 2022, marking a 22% hike from 2021.

Diego Lopes da Silva, a SIPRI senior researcher, said: "A case in point is Türkiye’s Baykar, producer of the Bayraktar TB-2 drone. Baykar entered the Top 100 for the first time after its arms revenue rose by 94%, the fastest growth rate of any company in the ranking."

China accounted for the second largest share of combined Top 100 arms revenues by country, at 18%. The eight Chinese arms companies saw a 2.7% rise in revenues to $108 billion in 2022.

Due to a lack of data, only two Russian companies were included in the list, the report said. Their combined arms revenues fell by 12% to $20.8 billion.

The sole Ukrainian company in the Top 100, UkrOboronProm, posted a 10% decline in its arms revenue to $1.3 billion.


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