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The Navy of the Future: Classics, Science-Fiction, Contractors

The guided-missile cruiser USS Chancellorsville during a replenishment-at-sea with the aircraft carrier USS Ronald Reagan. Mass Communication Specialist 2nd Class John Harris/U.S. Navy/Flickr

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The renewed rivalry between the world powers, almost formally dubbed the second Cold War now, could not but fuel the development of new weapons and military equipment. Naval forces chose not to stand on the side-lines of this new race, despite a certain conservatism of the hardware they employ, which is predicated on the life cycle these products. Incidentally, many questions that the new round of technological advancement is set to answer were first raised back in the 19th century, and these questions remain relevant to this day.

Leaders in the Race

The guidelines for the development of national naval forces across the world, both today and in the foreseeable future, are governed by the rivalry between the United States and China.

The naval part of this confrontation is characterized by opposite trends in the development of their respective fleets, while the countries focus on similar approaches in exploring new types of weapons and military equipment.

Let us examine the main features that determine the similarities and differences in the American and Chinese approaches. In terms of similarities, both sides pay considerable attention to the development of new types of naval weapons and equipment, such as unmanned surface and submersible vessels, unmanned aerial vehicles, hypersonic missiles, laser and electromagnetic weapon systems, etc. An undeniable similarity lies in the level of attention that both countries devote to upgrading naval aviation (both carrier- and shore-based) and expeditionary forces, even despite the difference in their current standing with these components, where the United States has been the unconditional leader for many decades. Meanwhile, China has only joined the race this past decade after floating out its first two aircraft carriers and a multi-purpose amphibious assault ship.

The differences are just as striking: the approaches to the development of the naval components of both countries are diametrically opposed to one another. The concept of the shipbuilding programme implemented by the People’s Liberation Army Navy is primarily based on building blue-water surface ships: the pace of building large destroyers and cruisers resembles the shipbuilding efficiency typical for the great maritime nations prior to World War II. Suffice to say that during the past decade, China’s PLA Navy has received, on top of other equipment, a total of 20 capital ships without aviation capability, including 19 destroyers and the first “large destroyer” of new type 055, which many experts classify as a missile cruiser, plus two aircraft carriers. The United States, in addition to other armaments, got 11 destroyers and one aircraft carrier, thus yielding the lead in the construction of capital surface ships for the first time since World War II, even though the country is still able to retain notable superiority over China in the number of such ships and in the overall capabilities of the blue-water navy.

In the next few years, the United States intends to ramp up the commissioning of new ships, but its priority, according to a recent statement by Secretary of Defense Mark Esper, is to develop light naval forces. The United States will resume building frigates (the U.S. Navy has no frigates today after decommissioning of the last Oliver Hazard Perry-class ships), small and medium amphibious assault ships for island operations, other small surface combatants, including optionally manned and unmanned vessels, and finally light aircraft carriers, whose price forces the U.S. Navy to consider cutting their number.

Furthermore, the two countries demonstrate continued differences in the concept of their operations. It would appear that China adheres to the Soviet take on the role and place of aircraft carriers, whose first priority is to ensure the combat stability of the navy outside the reach of shore-based fighter jets. The strike capabilities of naval forces are concentrated in the missile armament of destroyers, cruisers and submarines.

In this context, media sources and experts continue to debate the future development of this class of ships by the PLA Navy and the rate at which it rolls out new elements of aircraft carrier technology. It was thought that the third Chinese aircraft-capable ship would be nuclear-powered, but experts now agree that it will have a conventional propulsion system.

One more issue at large is China’s readiness to introduce another important element of the latest carrier technology, namely, electromagnetic catapults. Some media sources have reported that PLA Navy had been planning to restrict the size of their carrier force to four ships and would start building a fifth after a number of essential technologies have been developed.

In the United States, carrier-based aircraft continue to play the role of the main strike power within the Navy’s general purpose forces, but this is also starting to change. First off, the development of light forces and their weapons under the Distributed Lethality concept will inevitably inflate the role of surface combatants, especially in the frigate/destroyer class. Secondly, the role of shore-based aviation is becoming more essential. For example, the P-8A Poseidon maritime patrol aircrafts can be effectively employed against surface combatants, just like the U.S. Air Force strategic bombers B-1B carrying LRASM anti-ship cruise missiles.

The development of mine warfare by the United States and allied naval forces is another important trend: the amount of investment in new mine warfare technologies is growing, along with the capabilities of mine weapons. The allies focus on the development of smart naval mines that can form consistent sweeping-proof mine barriers and are capable of blocking enemy fleets inside their home stations or isolating the combat zone, thus throttling the most probable lines of approach. Mine countermeasures have also seen some substantial development, and the number of unmanned mine-sweeping systems, both surface-operated and submersible, is growing fast. This will possibly make mine warfare and mine countermeasures the initial fault line in the sea, where most operations will be carried out without the direct involvement of human operators.

Gaining a Foothold

The United States may have lost out to China in terms of overall strength at sea in 2019, but it retained its leadership in the number of capital ships. Today, however, it continues to rely on elements other than combat units.

The current progress in all of the nation’s armed services lies in the development of new-generation combat control systems that enable real-time communications among different detection devices, control facilities and weapon carrying systems.

The further development of these systems indicates that the United States is creating a “digital battlespace,” looking to make a quantum leap in increasing the awareness of commanding officers in the field and reducing the decision-making time to negligible values.

The key projects in this area are implemented under the Joint All Domain Command and Control (JADC2) programme, which is geared towards uniting all the detection and target acquisition systems employed across the U.S. Armed Forces into a single network. Cross-branch interoperation capabilities have been traditionally limited due to the differences in architecture of existing control systems. Establishing the chain of command, coordinating plans and assigning tasks often took days to accomplish when cross-branch coordination was required. By its design, the JADC2 project will render all processes automatic and reduce the required coordination time from hours to minutes, and in some instances to seconds.

JADC2 envisages the development of a cloud-based platform for exchanging data transmitted via numerous communication networks to fast-track the decision-making process. The project team uses commercial online taxi services as the grassroots model for the JADC2. Under the programme, new control systems are being developed for individual armed services, many of which are already in the trial phase. The key outcome of these trials is the capability to automate data exchange among different platforms that were not originally designed as interoperable systems: for example, Marine Corps fighter jets and Army howitzers, or U.S. Navy destroyers and Army multiple rocket launcher systems, etc.

The development of a new generation of radars for both maritime and aviation navigation systems, including orbital, reconnaissance (including space reconnaissance assets), command and control, and data exchange systems (also involving space vehicles) and weapons capable of real-time receipt and modification of target acquisition data from remote sources, as well as the development of the “digital battlespace” with the heavy interoperation with unmanned aerial vehicles, and the employment of new air-to-air and air-to-surface controlled weapon systems—all this leads us to the conclusion that the United States and a number of other developed nations are gradually and consistently shaping a new type of combat environment, most importantly in the air.

Its pivotal differences from the existing environment are represented by the spike in the level of situational awareness, along with increased analysis capabilities and reduced decision-making time.

Arctic Reflections

The U.S.–China standoff at sea should not eclipse the processes that are more obvious to Russian readers, namely the development of the Russian Navy that is also unfolding in the context of the renewed adversarial relationship with the West. The key element of this confrontation is the fundamental economic imbalance that pushes weapons designers in Russia to look for unorthodox solutions.

It is safe to say that the key trend in the evolution of the Russian Navy is the enhancement of missile weapons, from air defence to strategic missile systems, as well as the development of submarine and special operations forces that are meant, on one hand, to ensure the deployment of the national naval component in the most comfortable conditions and, on the other hand, to make similar deployment by the adversary as challenging as possible.

In this regard, the focus is on designing domestic combat and surveillance unmanned underwater vehicles and stationary underwater acoustic surveillance systems, as well as on developing new technologies for locating enemy submarines and surface ships that enable early detection of such units in a conflict zone and employ both existing and prospective missile weaponry. This development resonates with the ongoing effort to rehabilitate infrastructure along the coast and on the islands of the Arctic Ocean, which is once again becoming an arena of confrontation, like it was during the first Cold War.

To some extent, the current developments in the Arctic may be viewed as a reflection of the U.S.–China showdown in the west of the Pacific. Just like China, Russia has an infrastructural advantage in the vicinity of its continental territory (with its “Arctic” hang, which includes a robust icebreaker fleet) and a larger force deployed in the theatre of operations. At the same time, NATO’s overall supremacy over Russia is more significant than that of the United States and its allies over China in the Far East, making Russia fear the outcome of a potential conflict in this area.

Such an awareness of the inadequacies of Russia’s Armed Forces dictates that the country turn back to the operational strategic approaches employed in similar situations in the past. As a result, the defence system that is now being deployed in the Arctic region to set up the bastions, (so-called “Protected Operating Area” in Russian military terms), may be compared with the central mine and artillery position that the Baltic fleet was primarily tasked to develop and defend during the First World War, now adjusted for geography and technological advancement. The transformation of this concept depends not only on the future development of the Russian economy and the creation of new types of weapons, but also on the evolution of views on the naval force, which Russia has seen for more than a hundred years as an auxiliary asset, rather than an independent strategic element.

Who is Next?

Speaking of trends in the development of naval forces in second- and third-world countries, we chiefly point out their dependence on cooperation with one of the leaders (or balancing between them), and this aspect largely governs the series of technological and operational solutions. It is important, though, that this mostly applies to countries that are not among the top five, and often not among the top ten largest naval powers.

There are several common trends in this context. For instance, a number of countries are showing increasing interest in deploying shore-based maritime patrol aviation. The market offers several light aircraft of this class today—typically redesigned turbo-prop passenger planes used for local flights or light military transport aircraft, such as ATR-42/72, С-212, 235, 295 and others.

In this case, relatively inexpensive and commonly used local-fight (less often medium-range) airliners and business jets are used in maritime patrol aviation. With this approach, even relatively poor countries can purchase individual units or small sets of such airplanes, thus being able to control their territorial waters and exclusive economic zones. For major powers, this approach, combined with the use of long-rage radar detection aircraft, opens the door for building special operations wings and setting up major anti-access/area denial (A2/AD) zones with a robust control and target acquisition systems, depending on the country’s economic capacity and views on existing threats.

Speaking of ships, in the vast majority of cases, secondary naval powers do not trouble themselves with building a balanced and self-sustainable naval element, which would be an extremely expensive initiative. Instead, they focus primarily on coastal defence systems with the deployment of individual components for operations in offshore maritime zones and blue-water theatres, predominantly as part of a coalition.

This dependence on coalitions, coupled with the constant need for support from arms and military equipment vendors, who rarely permit self-maintenance by the end user, makes such second- and third-world countries rely on the aid provided by coalition leaders, thus severely limiting their room for manoeuvre. Incredible as it may seem, “freedom of action” in this regard is directly proportional to the age of the available materiel: more often than not, nations that own ships and weapons dating back to the Cold War times already know how to service, maintain and even manufacture some component parts, or they can make up for any parts needed from the vast and hard-to-control “grey” market of weapons and components of the 1970–1990s that were supplied in abundance by certain satellites of the Cold War superpowers. The upgrade or replacement of the old fleet often turns into a honeytrap, increasing the efficiency of their weapons, on one hand, and severely narrowing their leeway on the other. They certainly understand the situation and see the acquisition of military equipment, especially something as complex and expensive as combatant ships and their weapon systems, as a political step, with all that such steps may entail for the decision-making process.

Could we take the next logical step and say that buying these complex weapons systems today also means choosing which military coalition to joint in the future, which is no less important for understanding the prospects of war at sea than the development of naval equipment per se? Perhaps this point of view can at the very least be seen as having its reasons.

From our partner RIAC

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Defense

SCO: Potential and Challenges to Regional Integration

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The modern system of the world is facing the state of imbalance as it passes through the phase of change and evolutionary development. Globalization has emerged as a main trend in international relations and deepens the interdependency between countries of the world. The rapid increasing interdependency contributes for countries to get close one another and to protect their interests. The desire of extending economic and trade activities, access to capital market and the contracts for investment are encouraging countries to work together and to cooperate. The cooperation for economic activities, trade, transportation, information, communication and transmission are making the countries and regions unite.

Regionalization has emerged as a new form and process of interaction among the countries of the world. Many countries are striving to establish a system of cooperation with their neighbors to enhance their potential and also to facilitate each other for solution regional issues. Thereby, the regionalization has taken diverse form of regional integration including the establishment of multinational regulatory system and flexible model of cooperation and partnership in different areas and at different levels. The Shanghai Cooperation Organization (SCO)is an outstanding example of regionalization and hybrid and new mixed model of interstate multifaceted cooperation.

SCO established in 2001 to meet the objectives of regional security and stability. Since the establishment the organization continued evolutionary path of multifaceted and multilateral cooperation. It does not desire to achieve a specific target level of collaboration, but it move systematically along the path of finding the common attribute in resolving the regional issues. The SCO also has potential of unique perimeters, new opportunities and directions of further development in the areas of security, economics and other mutual interests. The organization comprises of 43 percent of world population and 25 percent of global GDP. Similarly, it covers 80 percent area of Eurasia. Although the Shanghai Cooperation Organization is a young organization than the other international associations but it has the ability to achieve mutually beneficial solution of political, economic and security issues and it also leads to accumulation of unresolved issues of the region. However, the size never conflates with influence and effectiveness. In fact, the SCO is also facing hamstring by major regional economies and powers with their own interests in the region and mistrust between member states.

The Shanghai Cooperation Organization is often stated as a club of autocrat powers. The members follow the principle of noninterference in the internal affairs of other states. However, China and Russia adhere this principle rhetorical basis but not in reality. Both the countries have history of interference and violence of neighboring countries. The member states rely on the principle to push back at Western and local civil society effort to promote responsible governance, human rights and democratic norms in the region. Since the formation, the organization holds a broad goal of fighting against terrorism, extremism and separation. Furthermore, the convention of the Shanghai Cooperation Organization invokes the principle of United Nation charter to help clock the organization’s founding document with international legitimacy identifying all three equal threats to state security, public order and the safety of citizen. The member states also have commitment to share information about terrorist activities and threats and to make request to act against individuals or organization. Subsequent declaration of the Shanghai Cooperation Organization and agreements of the member states have simply added to the list of principles and their responsibilities. Since the surveillance of new technology the member states moved beyond the simple method of information exchange to best practice of monitoring and tackling.

On the other hand, the Shanghai Cooperation Organization has had very little achievements to strength domestic security despite the convergence of member states. The RATS (Regional Anti-Terrorism Structure) based in Tashkent Uzbekistan has been coordinating to combat these three evils Terrorism, Extremism, Separation). The RATS provides a platform and services to member states particularly Central Asian States of Kyrgyzstan and Tajikistan for sharing intelligence but it made very little progress. Furthermore the RATS shares intelligence with member states but the terrorist threats are increasing.

Since the SCO framed, the high hopes of diplomatic relations, effective economic and security cooperation were made by the founding members. It was also expected that the organization may bring regional cohesion to Central Asia and it would create great opportunities for the regional states of mutual trade and economic activities, and it will lead towards security promotion of the region. The founding partners of the SCO had ambitious plan for the transforming the organization in to a cohesive bloc with political and economic integration. There was also a hope that the organization may counter influence of EAEU and CSTO and will maintain its own influence in the region. But Russia wanted to dilute Chinese influence within the organization by advocating its expansion in to south Asia and other neighboring states.The SCO has organized many joint military exercises and efforts but could get any significant level of achievements because they were symbolic and political moves. To encounter any kind of security crisis and military operation in the region, there is a need of political logistical and operational system. For example during the unrest in Kyrgyzstan in 2010, the organization delivered an anodyne statement for peace; security and stability, additionally, China and Russia were hesitating to get involved. While, the other states and powers tried to play their role to tackle the crisis.

China and Russia are the primary drivers of the Shanghai Cooperation Organization but have different visions for this organization. Although they share common interest of regional stability within the organization but at the same time their geopolitical interests pull them in different directions. These differences are a big question mark, how the organization would achieve their objective and would evolve?  Russia thinks of SCO as a security to prevent encroachment by outside powers NATO, UE and United States, and also a tool to maintain its geopolitical domination on the region and less than a partnership in Central Asia.

 Since the post-cold war, the economic imbalance has increased between China and Russia. China is increasing its economic influence in Central Asia while Russia is worrying about its security issues. Moscow hopes that the Pakistan and Indian including in Shanghai Cooperation Organization may bind Beijing to more work for the security and stability of the region than to enhance its own economic influence in the region. As the issues of uncertainty in Afghanistan, Pakistan-India confrontation and instability on China-India border are a clear threat to the interests of all member states. China is also suspected about the Russian ability to act as the security manager in an area where china has invested and is investing billions of dollars. On the other hand, Beijing may not be able rely on extra regional powers to secure and prevent Central Asia from the security deteriorated environment. However, SCO has not made any mechanism or approach to play a decisive security role in Afghanistan post withdrawal United States and NATO force.

China thinks that economic activities and investment can mitigate instability. Shanghai Cooperation Organization also a tool to promote Chinese soft power and economic influence in Central Asia. Therefore, Beijing has been continued its investment in the region and through OBOR and SCO. Although the Central Asian States are receptive to these Chinese overture but they are also keen to prevent SCO to become an anti-western bloc because the states feel the need of Western powers to counterbalance their powerful neighbors. Moscow already has upended its relationship with West over the Ukraine issue, thus, in these circumstances; Russia has no other choice to acquiesce Chinese increasing economic influence in the region. Moscow may pull itself from the Chinese efforts to multiply its security role in the region. The current clash on border between China-India put Russia in to awkward position. Russia does not like tension between China and India but it suggests dialogues and appears to have little interest mediating. Russia never wanted that China convert SCO in to an economic and trade bloc while China never wanted that Russia transform the organization into a military alliance. It is hard to imagine that Shanghai Cooperation Organization may be able to deliver its original goals eradicate extremism, terrorism and separation through mutual cooperation because it appears with the major focus on economic integration across the Eurasian region.

Now the Shanghai Cooperation Organization is coexisting with other regional initiatives like OBOR, AIIB, CSTO and EAEU. Both China and Russia have expressed their intentions to work within these institutions.     Since the formation, the SCO is facing many structural and organizational challenges. All members have their own interests and values of independence and sovereignty, which are difficult to reconcile with collective security particular Pakistan and India, China and India have mutual mistrust and all Central States also have territorial issues with one another.  

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Possibility of an alliance in Sino-Russian Relations

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The defense ministers’ meeting of NATO member states was held in video format a few days ago (17/2/2021). During the period, the discussion focused on the topic of “China-Russia threat” and believed that a “global approach” should be adopted to curb China-Russia expansion.” At the same time, this meeting also attracted widespread attention from outsiders.

Senior Russian researcher, Vasily Kashin published an article in which he emphasized that when there is a risk of military conflict with the United States, China and Russia should immediately form a military alliance. And share the missile early warning data collected by themselves.

According to the article, Sino-Russian military technology cooperation has always been quite secretive, and because Russian companies have participated in the development of China’s ballistic missile early warning system, China and Russia are fully able to establish data sharing on this basis and establish their own global Missile defense network. Russian media subsequently reported on it and said that Russia has repeatedly proposed the formation of a Sino-Russian military alliance, and even President Putin himself has conveyed the idea of ​​an alliance with China.

It should be noted that the containment and suppression of China and Russia by Western countries do not stop there. To provoke the territorial sovereignty of China and Russia, US aircraft and warships have already on the doorstep of China and Russia, carrying out under the banner of freedom of navigation (FON).

Intensive reconnaissance activities, this behavior has seriously threatened the national security of China and Russia but also undermined global peace and stability. To build a global encirclement of China, the United States is also actively wooing other countries to join its anti-China front in an attempt to reorganize the eight-nation coalition forces to contain China.

It can be said that Western countries are pressing on with China and Russia step by step. As the US continues to escalate its suppression, the security situation around China and Russia will deteriorate again in the future, and the two sides may even break out head-on conflict.

Faced with the complex situation in the Indo-Pacific, China and Russia also need to strengthen cooperation in the field of national defense. After all, the two countries are originally a comprehensive strategic partnership of cooperation in the new era. In recent years, the strategic mutual trust between the two sides has been deepening and several rounds of military exercises have been jointly conducted.

Therefore, the opinions of Russian experts are in line with the future development trend of Sino-Russian relations. As a friendly country, Sino-Russian relations will only continue to develop for the better, and the possibility of China and Russia forming a military alliance in the future is not ruled out. The Chinese people also have extremely high expectations for the future direction of Sino-Russian relations. Chinese Foreign Minister Wang Yi once stated that Sino-Russian cooperation “has no end, no restricted zone, and no upper limit” (2/1/2020).

Foreign media believe that this means China’s non-aligned position or non-alignment Applying the Sino-Russian relationship again means that Wang Yi recognized the possibility of China and Russia forming a military alliance. Both China and Russia are peace-loving world powers and have always been committed to maintaining the peace and stability of the regional situation.

Therefore, even if a military alliance is concluded in the future, they will never follow a hegemonic line. In the final analysis, how China and Russia cooperate depends on changes in the international situation. Instead of worrying about the “threat” brought by the rise of China and Russia, Western countries should stop deteriorating the regional situation and work with China and Russia to maintain world peace and stability. Otherwise, this “heart disease” will never be eliminated.

It is worth noting that the Western countries, led by the United States, have a very playful attitude towards Sino-Russian cooperation. They have been using various means to sow discord between China and Russia in an attempt to prevent the establishment of a Sino-Russian military alliance.

However, the continuous deepening of cooperation between China and Russia is a historical development. The inevitable result of this is that no matter how obstructed by Western countries, Sino-Russian relations will continue to develop for the better, without any interference from external forces.

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The world arms sales market

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New data from SIPRI’s Arms Industry Database, released last December, show that arms sales by the world’s twenty-five largest defence equipment and military services companies totalled 361 billion dollars in 2019. This is an 8.5% increase in real terms in arms sales compared to 2018. All this emerged from the studies by the Stockholm-based International Peace Research Institute founded in 1966.

In 2019 the top five arms companies were all based in the United States: Lockheed Martin, Boeing, Northrop Grumman, Raytheon and General Dynamics. These five companies together recorded 166 billion dollars in annual sales. In total, twelve U.S. companies rank among the top 25 for 2019, accounting for 61% of total sales.

For the first time, a Middle East company appears in the top twenty-five. Edge, based in the United Arab Emirates, was established in 2019 from the merger of over twenty-five smaller companies. It ranks twenty-second and accounts for 1.3% of the total arms sales of the top twenty-five companies. This demonstrates that oil revenues in the Near and Middle East are also invested in businesses that produce jobs and money, and are not just accumulated for the personal expenses of the ruling elite. Edge is an example of how high domestic demand for military products and services, combined with the desire to become less dependent on foreign suppliers, is driving the growth of arms companies in the Near and Middle East.

Another newcomer to the top twenty-five list in 2019 was L3Harris Technologies (ranking tenth). It was created by the merger of two U.S. companies that were both in the top twenty-five in 2018, namely Harris Corporation and L3 Technologies.

The top twenty-five list also includes four Chinese companies. Three of them are in the top ten: Aviation Industry Corporation of China (AVIC, ranking sixth), China Electronics Technology Group Corporation (CETC, ranking eighth) and China North Industries Group Corporation (Norinco, ranking ninth).

The combined revenue of the four Chinese companies in the top 25 list, which also includes China South Industries Group Corporation (CSGC, ranking twenty-fourth), grew by 4.8% between 2018 and 2019. Chinese arms companies are benefiting from the People’s Liberation Army’s military modernisation programmes.

Conversely, the revenues of the two Russian companies in the top twenty-five, namely Almaz-Antey and United Shipbuilding, declined between 2018 and 2019, for a combined total amount of 634 million dollars. A third Russian company, United Aircraft, lost 1.3 billion dollars in sales and dropped off the top 25 list in 2019. Domestic competition and reduced government spending on modernising the Russian Navy were two of the main challenges for United Shipbuilding in 2019.

After the United States, the People’s Republic of China recorded the second largest share of 2019 arms sales by the top twenty-five companies, accounting for 16%.

The six Western European companies together account for 18%. The two Russian companies in the ranking account for 3.9%. Nineteen of the top twenty-five arms companies increased arms sales in 2019 compared to 2018. The largest absolute increase in arms sales revenue was recorded by Lockheed Martin: 5.1 billion dollars (11% in real terms). The largest percentage increase in annual arms sales (105%) was reported by French manufacturer Dassault Aviation Group. A strong increase in export deliveries of Rafale fighter aircraft pushed Dassault Aviation into the top 25 arms companies for the first time.

The Sipri report also examines the international presence of the 15 largest arms companies in 2019. These companies are present in a total of 49 countries, through majority-owned subsidiaries, joint ventures and research facilities. With a global presence in 24 countries each, Thales and Airbus are the two most internationalised companies, followed closely by Boeing (21 countries), Leonardo (21 countries) and Lockheed Martin (19 countries).

The United Kingdom, Australia, the United States, Canada and Germany host the largest number of these companies.

Outside the North American and Western European arms industries, the largest number of foreign corporate entities is hosted by Australia (38), Saudi Arabia (24), India (13), Singapore (11), United Arab Emirates (11) and Brazil (10).

There are many reasons why arms companies might want to establish themselves abroad, including better access to growing markets, collaborative arms programmes or policies in host countries that link arms purchases to technology transfers.

Of the 49 countries hosting foreign industries in the top 15 arms companies, seventeen countries are low- and middle-income ones. Southern countries seeking to restart their arms production programmes have welcomed foreign arms companies as a means for benefiting from technology transfers.

Chinese and Russian arms companies in the top 15 list have only a limited international presence. Sanctions against Russian companies and government limits on takeovers by Chinese companies seem to have played a role in limiting their global presence.

All these data were collected by the Sipri Arms Industry Database founded in 1989. At that time, it excluded data for companies in Eastern European socialist countries, including the Soviet Union. The updated version contains 2015 data, including data for companies in the People’s Republic of China and the Russian Federation. An archive of the first one hundred data sets for the period 2002-2018 is available on the Sipri website (www.sipri.org), while for the first twenty-five ones it has been updated with the latest available information.

Arms sales are defined as sales of military goods and services to military customers at national and international levels. Unless otherwise stated, all changes are expressed in real terms. Comparisons (e.g. between 2018 and 2019 or between 2015 and 2019) are based on the groups of companies listed in the respective year (i.e. the comparison is between different groups of companies).

For 2020-2021, Sipri is releasing its dataset on arms sales of the world’s largest companies along with the results of a mapping on the internationalisation of this industry. For this reason, a new dataset was created, including 400 subsidiaries, joint ventures and research facilities linked to the top fifteen arms companies in 2019. Data sources included corporate investment documents, information on company websites, public records and newspaper and magazine articles.

To be included in the mapping, an arms industry must have been active for the majority of its fiscal year, as well as be located in a country other than that in which its parent company is headquartered and also (i) produce military goods or provide military services to military customers; (ii) produce or provide services for dual-use goods to military customers.

This is the first of the key data handovers in view of the publication of the next Sipri Yearbook in mid-2021. Before that, Sipri will release its data on international arms transfers (details of all major international arms transfers in 2020), as well as its data on global military expenditure (comprehensive information on global, regional and national trends in military expenditure). We will inform readers of all this in due course.

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