The pandemic does not appear to have affected global demand for weapons, according to a new report, which finds that the 100 largest companies in the defense industry made $ 531 billion in 2020, an increase of 1.3% than the previous year.
Arms sales have grown steadily for six consecutive years, and the economic obstacles caused by Covid-19 have not been able to reverse this trend, the Stockholm International Peace Research Institute (SIPRI) said on Monday.
“The industry giants were largely protected by the government’s sustained demand for military goods and services,” some countries are even stepping up payments to lessen the impact of the pandemic, said Alexandra Marksteiner of SIPRI’s military spending and weapons production program.
The United States maintained its lead in the sector in 2020. There were 41 American companies on the list, with five of them occupying the top five places since 2018. Total revenues of American arms manufacturers reached l last year $ 285 billion, up 1.9% from 2019.
Chinese companies took second place, with total revenues of $ 66.8 billion, or 13% of global arms sales in 2020. SIPRI attributed the success to Beijing’s military modernization program, which transformed local defense companies in “Some of the most advanced military technology producers in the world”.
The 26 European arms manufacturers posted “mixed results” last year, according to the Swedish researcher. The UK came third overall after China, with its seven Top 100 companies making $ 37.5 billion, an increase of 6.2% from 2019. German companies saw their profits increase by 1.3% and reach 8.9 billion dollars, while the sales of their French counterparts fell by 7.7%.
The downward trend that started in 2018 continued for Russian arms manufacturers last year, according to the report. The country’s nine Top 100 companies saw sales drop from $ 28.2 billion in 2019 to $ 26.4 billion.
The decline could be explained by the conclusion of the state armament program 2011-2020 and the diversification of the Russian defense industry, with companies being tasked with increasing their share of civilian sales to 50% d ‘by 2030, according to the authors. They did not mention Washington’s sanctions and pressure on countries looking to buy Russian-made weapons among the possible reasons.
SIPRI reports “Cannot be considered as a source of objective information”, Russian military-industrial conglomerate Rostec said in response to the new figures.
“Western analysts rely only on open sources and do not know the reality”, he said in a statement. SIPRI also overlooks the fact that most payments for Russian weapons are made in rubles, not dollars, while focusing only on profits, instead of counting the actual number of units sold.
Rostec’s profits are steadily increasing each year and production levels remain high, the statement insisted.