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The growth of the arms trade has slowed globally due to supply problems

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Sales of arms and services to the military sector increased in 2021, but were affected by supply problems related to the pandemic and the war in Ukraine, a situation that should stimulate demand, according to a new report released Monday.

According to the Stockholm International Peace Research Institute (SIPRI) report, the top 100 arms companies sold weapons and services to the military sector for a total of $592 billion (about 562 billion euros) in 2021, an increase of 1.9% compared to 2020. However, this growth was severely affected by problems Wide scope of supply.

“The lingering impact of the pandemic is already beginning to be seen in arms companies,” Nan Tian, ​​a researcher at the Sipri Institute and a co-author of the report, told AFP. Problems related to a shortage of labor and the provision of raw materials “slowed companies’ ability to produce weapons systems and deliver them on time.”

“What we are seeing, in fact, is growth, perhaps slower than many expected, in the field of arms sales in 2021,” Tian added.

Supply problems are expected to be exacerbated by the war in Ukraine, and “because Russia is a major supplier of raw materials used in weapons production,” according to the authors of the report, but also because this conflict has led to an increase in demand.

According to Tian, ​​it is still difficult to assess the level of this increase, which is related to the countries that helped Ukraine and its need to replenish its stocks. The level of this increase is also related to the deterioration of the security environment, which leads to “the efforts of countries to buy more weapons.”

Although American companies still dominate the global arms production market, accounting for more than half of global sales (or $299 billion), the United States is the only region in the world that has seen a decrease in its sales compared to 2020.

Among the top five companies in the market (Lockheed Martin, Raytheon Technologies, Boeing, Northrop Grumman, and General Dynamics), only Raytheon’s sales grew.

Meanwhile, sales of the eight largest Chinese arms companies rose 6.3% in 2021 to $109 billion.

As for European companies, which now represent 27 out of the 100 largest companies, their turnover reached $123 billion, up 4.2% from 2020.

The report also indicates a trend among private investment companies to buy weapons companies, a development that the report’s authors believe has become more evident in the past three or four years. They believe that this trend threatens to make the arms industry more opaque, and thus more difficult to track.

• The top 100 arms companies sold weapons and services to the military sector for a total of $592 billion (about 562 billion euros) in 2021, an increase of 1.9% compared to 2020. However, this growth was severely affected by widespread supply issues.

• Although US companies still dominate the global arms production market, accounting for more than half of global sales (or $299 billion), the United States is the only region in the world that has seen a decline in its sales compared to 2020.