Tweet 1/18/06 "fpif" -- -- War, instability, and high oil prices have created a perfect storm of profit for the world's weapons manufacturers. This year, military analysts predict the biggest arms bonanza since 1993 … which is saying something because in the aftermath of the first Gulf War the global industry reaped the benefits of a $42 billion arms race.
As the world's largest producer and exporter, the United States is riding the wave. For fiscal year 2006, which ended on September 31, the U.S. Defense Security Cooperation Agency churned out notices for $21 billion in arms sales offers . In most cases, that agency is required to notify Congress of all potential major arms deals worth more than $14 million. In one typical day—September 28—the DSCA issued notification on $5.5 billion in agreements. South Korea would get $1.5 billion in Patriot missile equipment and other hardware, Turkey was offered a $2.9 billion package including 30 F-16 fighter planes, while Jordan and Chile were also offered weapons packages.
While not all deals are finalized with arms deliveries, these notifications are a way of taking the pulse of the weapons market … and it is racing. U.S. a rms sales offers for 2006 appear to be roughly twice the levels of any other year during the Bush administration. Noteworthy among these are the $5 billion deal for F-16s to Pakistan and a $5.8 billion agreement to completely re-equip Saudi Arabia's internal security force.