Arms producers increasing profits globally amid conflicts

By Lisa Zengarini 

The global arms industry saw its revenue ramp up to 632 billion dollars in 2023, a 4.2 percent increase compared to 2022, according to a new report by the Stockholm International Peace Research Institute (SIPRI).

The surge reflects the impact of ongoing conflicts, such as the wars in Ukraine and Gaza, growing tensions in East Asia and rearmament programmes elsewhere. The trend is likely to have continued in 2024, as conflicts and geopolitical tensions persist, experts of the Swedish-based institute said.

The U.S. 

The figures show that the United States in 2023 maintained its dominance in the arms sector, with 41 companies in SIPRI’s Top 100 accounting for $317 billion, or 50 percent of global arms revenue—a 2.5 percent increase from the previous year.

China

China, the second-largest arms producer in the world, saw the revenue of its nine leading arms firms increase by only 0.7 percent "amid a slowing economy," but their sales still totalled 103 billion. The Chinese companies are focused on modernising the country’s military with advanced systems critical to its strategic ambitions in the South China Sea, Taiwan, and along its border with India.

Nato nations

The report highlights how geopolitical tensions are driving arms revenues globally. In Europe, NATO nations increased military spending in response to Russia’s invasion of Ukraine with the result that weapon firms in various countries saw an upsurge in sales.

Russia

The figures for Russia, though incomplete, give a clear signal of an economy increasingly geared toward war. Sales by the two Russian groups in the ranking rose by 40 percent, mainly thanks to a 49 percent increase in sales for state-owned conglomerate Rostec, according to the report.

Middle East countries

Manufacturers in the Middle East were also boosted by the war in Ukraine and by the first months of the Israeli offensive in Gaza after the Hamas attack of  October 7, and saw on average an 18 percent increase in sales.

The three leading Israeli manufacturers recorded sales of 13.6 billion dollars, up 15 per cent from 2022, while the three groups based in Turkey, such as drone producer Baykar, saw their sales surge by 24 percent -- boosted by Ukraine and Turkey's investments in its defence.

Asia

In Asia, concerns over Taiwan’s security and the India-China border conflict have also led to heightened defence investments.

The trend toward rearmament was particularly evident in the growth in sales by the four South Korean manufacturers, with revenues rising 39 percent on average, and five Japanese firms that saw an average increase of 35 percent.

Pope’s repeated appeals for disarmament

In his tireless appeals for peace, Pope Francis has often blasted the weapons industry and its “instruments of death” that fuel wars, saying that world hunger could be eradicated if weapons manufacturing money were reallocated to more directly address poverty and for development, health and education.

He reiterated this point in his recent message to the G-20 in Rio de Janeiro, Brazil, in which he denounced the spending on weapons, greed, and inequalities that cause hunger and poverty.