With global sabre-rattling reaching levels not seen since the end of the Cold War, research by the Stockholm International Peace Research Institute (SIPRI) gives us a unique view of who benefits from the current pervasive war mentality. In its Fact Sheet “The SIPRI Top 100 Arms-Producing and Military Services Companies, 2016“, SIPRI looks at the global arms manufacturing business and provides us with an interesting look at just how profitable this business is, a fact that should be of great concern to taxpayers everywhere since it is our hard-earned tax dollars that ultimately end up as profits for the defense business. Here are some of the more interesting facts from this very well researched fact sheet.
According to the authors, the 100 largest arms-producing and military services companies had total sales of $374.8 billion in 2016, a year-over-year increase of 1.9 percent, the first increase since 2010 as shown on this graphic:
In the top 100 defense companies we find 63 American and West European companies which account for 82.4 percent of total arms sales for 2016. Of these, 38 are American and 25 are Western European with companies in the United Kingdom, France, Germany, Sweden, Spain, Poland, Norway, Italy and Switzerland. A total of 10 companies out of the 100 largest are located in Russia. Other major defense companies are located in Israel, Japan, India, South Korea, Singapore, Turkey, Brazil and Australia. It is important to note that there are several China-based arms-producing companies that would be large enough to fit into the top 100, however, there is a lack of accurate data available. Based on the growth in China’s military spending, the authors estimate that at least 9 or 10 Chinese companies would be in the top 100 and 2 would be in the top ten. It is also interesting to note that over the past 15 years, the same 12 companies have occupied the top ten spots on the ranking, showing how the power in the defense industry is controlled by a few companies; in 2016, the top ten companies accounted for $194.8 billion worth of sales or 52 percent of the total for the year.
Here is a pie chart showing the national share of arms sales by the top 100 companies:
As you can see, American companies are, by a wide margin, the biggest sellers of equipment designed to kill and maim people.
Here is a breakdown of sales by region:
2.) Western Europe: In the top 100, we find 8 British companies which account for sales of $36.1 billion or 9.6 percent of total sales. Sales on a year-over-year basis grew by 2.0 percent. BAE Systems, Britain’s largest arms dealer, was the largest seller with sales up by 0.4 percent followed by Rolls-Royce which saw sales rise by 4.5 percent on a year-over-year basis.
In the top 100, we find 6 French companies which account for sales of $18.6 billion or 5.0 percent of total sales. On a year-over-year basis, sales dropped by 0.8 percent mainly due to a slowdown in delivery of Dassault’s Rafale combat aircraft.
3.) Russia: The 10 Russian companies listed in the top 100 had sales of $26.6 billion in 2016, accounting for 7.1 percent of the overall sales. On a year-over-year basis, sales rose by 3.8 percent with sales rising for 5 companies and falling for 5 companies. United Aircraft Corporation, the 13th ranked company in the top 100 saw arms sales rise by 15.6 percent on a year-over-year basis, the highest growth among all Russian companies in the top 100.
In closing, here is a table showing the key data for the top 20 companies in the top 100:
Thales Group of France which is also known for its space, ground transportation and security divisions, between 61 and 95 percent of sales are related to arms sales meaning that these companies are essentially supported by tax dollars.
Given the world’s current state of war in several theatres along with the pre-war posturing by Washington, Tehran and Pyongyang, the global trend in military spending is likely to increase over the coming years, much to the delight of the global military-industrial complex. Fortunately, there seems to be an endless source of taxpayer funding that keeps the ladies and gentlemen occupying the executive floors of these companies in the lifestyle to which they have become accustomed.
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