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Arms Sales Topic Daily Update

Arms Sales Topic Daily Update

US restraints don’t create norms, countries will turn to alternate suppliers

Ted R. Bromund, Ph.D., is a senior research fellow in Anglo-American Relations in The Margaret Thatcher Center for Freedom at The Heritage Foundation, May 23, 2019, https://thehill.com/blogs/congress-blog/foreign-policy/445254-trumps-rejection-of-the-arms-trade-treaty-is-based-on, Trump’s rejection of the Arms Trade Treaty Is based on reality

If nations around the world want to not sell arms to dictators, all they need to do is not sell. No treaty is necessary. If nations want to control their borders to prevent illicit arms imports, the same is true. We don’t need a treaty. We need more democratic, competent governments. Without them, no treaty can work. With them, no treaty will be necessary. The argument that progressives offer is that if the U.S. stops making arms sales the left dislikes, this will create influential “norms.” If you truly believe that Russia will become responsible if the U.S. simply does things that progressives like, good luck to you. But there is no basis for this belief. It’s a fantasy, and a self-disarming one at that. The progressive focus on the U.S.’s arms sales isn’t a coincidence. Iran’s arms sales don’t much bother the treaty’s advocates. But they really hate the West’s. If you doubt this, look at what they do. When the progressive group behind the ATT wanted to quote a foreign condemnation of the president’s decision, to whom did they turn first? To Press TV, the mouthpiece of the Iranian regime. The treaty’s friends have sued the British government to stop its arms sales. They leak assiduously against the French government. They vehemently oppose U.S. arms sales, and — like Trevor Thrall in these pages — support the treaty as a way to stop those sales. But they do and say nothing about the dictators. When Rachel Stohl, one of the treaty’s most vehement defenders, wrote about the missiles that shot down flight MH-17 in 2015, who did she blame for supplying them? Vladimir Putin No. She blamed “today’s globalized environment.”

US paying countries not to buy weapons from Russia

Blake Stillwell, May 21, 2019, https://www.wearethemighty.com/gear-tech/us-stops-russian-arms-sales, The US will pay countries not to buy arms from Russia

It was a program designed by the State Department to help the former Warsaw Pact countries break away from dependence on the Russian economy – the United States would straight up pay the newly liberated former Soviet Union allies to buy American-made weapons instead of buying them from their former patron. That program is back, and the United States is expanding it. A Russian-built Hind helicopter in the Macedonian Air Force It’s called the European Recapitalization Incentive Program and Eastern Europe is signing on for arms made in the good ol’ US of A. But the U.S. isn’t stopping at limiting Russian influence through arms sales, the American government is using the program to limit arms sales from China too. It’s a function of the State Department working hand-in-hand with the Pentagon in an effort to project American economic power and military goodwill. “The goal is to help our partners break away from the Russian supply chain [and] logistics chain that allows Russian contractors and service personnel, and Russian-manufactured spare parts onto either NATO allied bases or partner military bases,” a State Department official told Defense One. A Russian-built T-72 tank in the Slovakian Army. The countries signing on to the revitalized program can’t just promise not to buy Russian or Chinese weapons from now on. They will also need to get rid of their old ones as well as purchase new American replacements. So instead of gifting these countries a hodgepodge of military arms or vehicles, the countries can invest in American military power while getting rid of old systems and updating their military capabilities. Some of the partner countries are still using Soviet-built weapons. In the past year, the U.S. State Department has signed on six former Soviet Bloc countries to the program to the tune of $190 million, including Albania, Bosnia, Croatia, Greece, North Macedonia, and Slovakia. The program will even bring these countries up to NATO standards in many areas. If successful, the U.S. will expand the program beyond Eastern Europe to help other countries break free of Chinese and Russian dependence.

US may sell arms to Hungary

URDU Point, May 19, 2019, https://www.urdupoint.com/en/world/us-in-discussions-with-hungary-over-arms-sale-618518.html

The United States has been in discussions with Hungary over potential arms sales as the Eastern European country plans to increase its defense spending to two percent of GDP by 2025, a senior US administration official told reporters on Friday. “There’s a real market share there that we think we can exploit, assuming that they are moving to increase their defense budget. There are some arms sales under discussion,” the senior administration official said. On Monday, President Donald Trump will host Hungarian Prime Minister Viktor Orban in Washington to discuss a range of issues concerning trade and security.

It’s getting easier to export hand guns and 3D guns

The Crime Report, May 14, 2019, New Rules for Gun Exports Smooth Path for 3D Weapons Overseas, Groups Warn, https://thecrimereport.org/2019/05/14/new-rules-for-gun-exports-smooth-path-for-3d-weapons-overseas-groups-warn/

The Trump administration’s proposals to ease restrictions on firearms exports will create “new and unacceptable risks of exacerbating gun violence, human rights abuses, and armed conflict,” a coalition of 100 organizations warned in an open letter to Congress Tuesday. Under a proposed rule change sent to Congress last month, firearms manufacturers would no longer need to register for a license from the State Department to export semi-automatic weapons and other small arms. Instead, they would only have to apply to the Department of Commerce, where the process is simpler and less costly. The proposed new rules would also make it easier to sell technical information and blueprints for 3D-printed guns, which are also currently under State Department license, making such weapons “readily available to terrorist groups and other criminal elements, and endanger American embassies, military bases, and passenger aircraft at home and abroad,” the letter said. “Although proponents of the proposed changes argue that small arms are less dangerous because many can be bought in U.S. retail outlets, the fact is that armies are built from these firearms,” the organizations declared, noting that the proliferation of small arms has fanned conflicts in regions like Central America, as well as Congo, Burma and Mexico. The letter was signed by a wide network of religious groups, national and state gun violence prevention organizations in 14 states, as well as human rights groups. The groups said Congressional oversight over sales of all types of weapons and ammunition was in the interests of all Americans. “Congressional notification has been an imnportant backstop, helping forestall firearms transfers to repressive forces, such as those in Turkey and the Philippines,” the letter said, noting that Congress is informed of all weapons sales valued at $1 million or more authorized by the State Department are “No such notification requirements will exist if these weapons are transferred to Commerce control.” The proposed changes will go into effect this month unless Congress blocks them.

Ukraine depends on US arms sales to defend itself from Russia

Josh Mitchell, May 10, 2019, https://talkingpointsmemo.com/edblog/this-shocking-abuse-of-office-continues, , This Shocking Abuse of Office Continues, US In Discussions With Hungary Over Arms Sales – Senior Official

As you know, Ukraine remains highly dependent on the United States, diplomatically, economically and even militarily, at least in the sense of arms sales. Russia continues a de facto occupation/insurgency in the country’s east. Crimea has already been annexed by the Russian Federation

US may sell arms to Hungary

URDU Point, May 19, 2019, https://www.urdupoint.com/en/world/us-in-discussions-with-hungary-over-arms-sale-618518.html

The United States has been in discussions with Hungary over potential arms sales as the Eastern European country plans to increase its defense spending to two percent of GDP by 2025, a senior US administration official told reporters on Friday. “There’s a real market share there that we think we can exploit, assuming that they are moving to increase their defense budget. There are some arms sales under discussion,” the senior administration official said. On Monday, President Donald Trump will host Hungarian Prime Minister Viktor Orban in Washington to discuss a range of issues concerning trade and security.

Russia increasing arms sales to India

Fpiskopos, 5-15, 19, Mark Episkopos is a frequent contributor to The National Interest and serves as research assistant at the Center for the National Interest. Mark is also a PhD student in History at American University, https://nationalinterest.org/blog/buzz/russia-just-sold-750000-ak-203-rifles-what-you-need-know-57582

Russia Just Sold 750,000 AK-203 Rifles: What You Need To Know How good is it? But the deal, signed for a whopping 750,000 AK-203 rifles with 40,000 to be directly imported, is no less significant from the perspective of the Russian arms export business. Would it have been more profitable in the short term to simply sell India 750,000 AK-203’s? From air defense systems to nuclear submarines, the Soviet Union has enjoyed a longstanding, profitable defense export relationship with India. However, both the USSR and its Russian successor state have historically struggled to break into the Indian small arms market. After decades of impasse, it appears that the Kremlin has found a solution in the form of Kalashnikov’s new AK-203 rifle. 0 SECONDS Do You Know What Happened Today In History? (This first appeared in March 2019.) Last week, Russian President Vladimir Putin and Indian Prime Minister Narendra Modi inaugurated a new, jointly-administered AK-203 production venture at the Korwa small arms production plant in Northeastern India. Report Advertisement President Putin greeted the occasion with a celebratory telegram, stressing the ways in which Russian defense technology complements India’s national security interests: “The new joint venture will manufacture world-famous Kalashnikov assault rifles of the newest 200 series and eventually will reach full localization of production. Thus, the Indian defense-industrial sector will have the opportunity to fulfill the needs of national security agencies in this category of small arms, resting upon advanced Russian technologies.” The Kalashnikov venture marks the end of New Delhi’s long, tortured search for a successor to the unreliable INSAS rifle that has served as the mainstay of the Indian armed forces since 1998. The AK-203, a 7.62х39 export variant of Kalashnikov new AK-12, boasts across-the-board performance improvements as compared with its INSAS counterpart. Report Advertisement The AK-203 eschews the infamous jamming and temperature operability problems plaguing the INSAS rifle, while boasting superior a lighter weight, shorter length, and modern assault rifle ergonomics. The latter includes polymer handguards, a picatinny rail, and an adjustable buttstock; while individually negligible, these features add up to an overall improved handling experience. But the deal, signed for a whopping 750,000 AK-203 rifles with 40,000 to be directly imported, is no less significant from the perspective of the Russian arms export business. Would it have been more profitable in the short term to simply sell India 750,000 AK-203’s? Perhaps, but Rosoboronexport– Russia’s official defense exporting agency– hopes that this deal will give Kalashnikov a foothold in the Indian firearms industry for decades to come. As Rosobornexport CEO Alexander Mikheev points out, the AK-203 is just the speartip of Kalashnikov’s plans for the Indian market: “The capacity of the plant is sufficient to arm the personnel of all security agencies in India. Should it become necessary, the parties will be able to ratchet up the production output and upgrade the facility to manufacture future models based on Kalashnikov’s unique design.” Kalashnikov’s previous efforts to expand into the Indian market stalled, among other reasons, due to the Indian preference for assault rifles chambered in 7.62x51mm NATO. Why, then, did New Delhi settle for the AK-203 in 7.62х39? There are few military reasons to opt for the smaller 7.62×39 casing, as 7.62×51 rounds will generally travel faster and farther under similar circumstances. Rather, India’s change of heart likely comes from the logistical and financial benefits of the joint production arrangement between Kalashnikov and India’s Ordnance Factory Board (OFB) production organization. In specific, OFB will hold a 50.5 percent stake in the joint venture. A majority share gives the Indian government access to Kalashnikov’s considerable supply chain and technical expertise, while still retaining long-term political decision-making power over the course of the project. The joint venture nonetheless marks an early milestone for Russia’s AK200 series, cleared for export in early February just prior to IDEX 2019. It also illustrates what Kalashnikov is sure to take as a positive affirmation of their expansive small arms export strategy, offering their flagship rifle in two different sizes and three distinct chambers so as to appeal to as wide a range of importers as possible. Report Advertisement Mark Episkopos is a frequent contributor to The National Interest and serves as research assistant at the Center for the National Interest. Mark is also a PhD student in History at American University.

Ukraine depends on US arms sales to defend itself from Russia

Josh Mitchell, May 10, 2019, https://talkingpointsmemo.com/edblog/this-shocking-abuse-of-office-continues, , This Shocking Abuse of Office Continues, US In Discussions With Hungary Over Arms Sales – Senior Official

As you know, Ukraine remains highly dependent on the United States, diplomatically, economically and even militarily, at least in the sense of arms sales. Russia continues a de facto occupation/insurgency in the country’s east. Crimea has already been annexed by the Russian Federation

US selling $3 billion in Arms to Qatar

Global Village Space, May 10, 2019, https://www.globalvillagespace.com/us-selling-arms-to-saudi-arabs-enemies/, US selling arms to Saudi Arab’s enemies

The US State Department has given the nod to a potential $3bn sale of 24 Apache attack helicopters and related equipment to Qatar, according to the Defense Security Cooperation Agency. The manufacturer- Boeing Co and other major defence contractors, including Lockheed Martin Corp, General Electric Co and Raytheon Co will take part in the project if a deal is eventually reached, DSCA said in a statement.

China is the world’s 4th largest arms supplier

Forecast International, May 10, 2019, https://dsm.forecastinternational.com/wordpress/2019/05/10/chinas-arms-exports-up-up-and-away-2/ China’s Arms Exports: Up, Up and Away – VIDEO

Beijing continues to build its stature as a global arms exporter, according to the Pentagon’s annual report to Congress on the military and security developments of the People’s Republic of China (PRC). Per Department of Defense research, China completed over $25 billion worth of arms sales between 2013 and 2017, thereby rising to the level of world’s fourth-largest arms supplier.

Grant aid is distinct from sales

Miller & Binder, May 10, 2019, Andrew Miller is the deputy director for policy at the Project on Middle East Democracy and served as the director for Egypt and Israel military issues at the U.S. National Security Council from 2014 to 2017. Seth Binder is the advocacy officer at the Project on Middle East Democracy. Previously he served as the program manager and research associate at the Center for International Policy’s Security Assistance Monitor program, where he focused on U.S. security assistance and arms sales policy, The Case for Arms Embargoes Against Uncooperative Partners, https://warontherocks.com/2019/05/the-case-for-arms-embargoes-against-uncooperative-partners/

The efficacy of withholding military assistance, including grant aid and arms sales, to modify the behavior of recipient countries is a hotly debated topic in the U.S. foreign policy community.

Arms reductions do reduce conflict – empirics prove

Miller & Binder, May 10, 2019, Andrew Miller is the deputy director for policy at the Project on Middle East Democracy and served as the director for Egypt and Israel military issues at the U.S. National Security Council from 2014 to 2017. Seth Binder is the advocacy officer at the Project on Middle East Democracy. Previously he served as the program manager and research associate at the Center for International Policy’s Security Assistance Monitor program, where he focused on U.S. security assistance and arms sales policy, The Case for Arms Embargoes Against Uncooperative Partners, https://warontherocks.com/2019/05/the-case-for-arms-embargoes-against-uncooperative-partners/

First, the empirical record does not support Rounds’ contention that arms embargoes do not deliver. While these suspensions are not a silver bullet, there is ample evidence to demonstrate that they can be effective in changing the policy of a target country. For example, in 2005, the United States successfully used the suspension of a joint weapons project to persuade Israel to cancel a proposed sale of drone equipment to China. In another example, then-Secretary of State Rex Tillerson secured commitments from Egypt to resolve a longstanding criminal case against 41 foreign NGO workers, including Americans and Europeans, and to suspend military cooperation with North Korea in exchange for releasing $195 million in suspended military aid. More recently, the legislative hold Sen. Robert Menendez placed on an arms sale to Saudi Arabia and the United Arab Emirates, when combined with threatened legislation to impose further restrictions on transfers to Saudi Arabia, helped pressure the Saudi-led coalition in Yemen to re-engage in negotiations with the Houthis, resulting in an imperfect but still important deal on the port of Hodeidah.

The author’s argument that arms embargoes do not work cites the 2013 suspension of U.S. military aid to Egypt following that country’s military coup. This policy clearly failed to reverse the military coup led by current President Abdel Fattah al-Sisi, but there are good reasons to question the validity of the example. Proponents of the suspension argue with good reason that it was not given a fair chance to work. Shortly after the decision was announced, senior U.S. officials told the Egyptians the aid would soon be restored, undercutting the coercive value of the suspension. From the perspective of the Egyptian government, it would have been irrational to make serious concessions in response to what they believed was an idle threat. Just as important, due to a plethora of exceptions and carve-outs, some U.S. military assistance to Egypt continued throughout the suspension period, including maintenance and sustainment, sparing the Egyptian military from the full force of the hold. Despite undercutting its own suspension, the hold still produced some good. U.S. diplomats were able to leverage the policy to deter the Egyptian government from enforcing an arbitrary September 2014 deadline for NGOs to register under Egypt’s draconian 2002 NGO law. And, although Egypt released U.S. citizen Mohamed Soltan from prison two months after aid was resumed, Cairo was partly motivated by the concern that the Obama administration could reverse its decision to resume arms shipments. To be sure, these accomplishments were relatively limited, and we should be careful not to overestimate the efficacy of arms holds. A foreign government is unlikely to fundamentally change its position on what it views as an existential issue. But prior suspensions have yielded tangible gains, and they should remain part of the U.S. foreign policy toolkit.

Arms sales cuts do not undermine US influence

Miller & Binder, May 10, 2019, Andrew Miller is the deputy director for policy at the Project on Middle East Democracy and served as the director for Egypt and Israel military issues at the U.S. National Security Council from 2014 to 2017. Seth Binder is the advocacy officer at the Project on Middle East Democracy. Previously he served as the program manager and research associate at the Center for International Policy’s Security Assistance Monitor program, where he focused on U.S. security assistance and arms sales policy, The Case for Arms Embargoes Against Uncooperative Partners, https://warontherocks.com/2019/05/the-case-for-arms-embargoes-against-uncooperative-partners/

Second, Rounds also overstates the costs of suspending arms transfers. He is particularly focused on the potential for losing “access,” a term that encompasses relationships with the recipient country’s military leadership; insight into their views, organization, and doctrine; and permission for the U.S. military to use that country’s bases and airspace. These are legitimate concerns, but suspensions do not automatically compromise access. Egypt, for instance, never curtailed the U.S. military ability to use the Suez Canal or Egyptian airspace while arms transfers were on hold. And, while intelligence about a foreign military is valuable, we often have other, clandestine ways to acquire such information. Moreover, we should not conflate access with influence. U.S. military officials had access to their Egyptian counterparts during the events of 2013, but those channels were of no use in deterring Egypt’s military from removing the country’s democratically elected president. Nor has U.S access reduced civilian casualties from Saudi-coalition bombing in Yemen. In these cases, access without influence does not absolve the United States of complicity.

Arms sales cuts will not cause shifts in sales to Russia and China

 

Miller & Binder, May 10, 2019, Andrew Miller is the deputy director for policy at the Project on Middle East Democracy and served as the director for Egypt and Israel military issues at the U.S. National Security Council from 2014 to 2017. Seth Binder is the advocacy officer at the Project on Middle East Democracy. Previously he served as the program manager and research associate at the Center for International Policy’s Security Assistance Monitor program, where he focused on U.S. security assistance and arms sales policy, The Case for Arms Embargoes Against Uncooperative Partners, https://warontherocks.com/2019/05/the-case-for-arms-embargoes-against-uncooperative-partners/

The author’s other major concern is that arms suspensions could result in the loss of arms sales to strategic competitors like Russia or China. The jobs created by such sales are not trivial matters, but studies have found that they do not provide the economic benefits or jobs that are often touted. Nor are these sales necessary to maintain the military industrial base, which is powered by billions of dollars each year from domestic purchases, except in rare cases. Fundamentally, the author’s implicit argument — that if the United States reliably supplies weapons to strategically important countries, they won’t seek them elsewhere — is suspect. Countries, including close partners like Egypt and the United Arab Emirates, have long sought to diversify their weapons stockpiles, and in an increasingly multipolar world, more countries are seeking to diversify their arms suppliers to maintain their own independence. While U.S. arms will continue to compete with Russian or Chinese counterparts on a sale-by-sale basis, it will become increasingly unrealistic to be the exclusive supplier of any partner country, irrespective of how reliable the United States is.

Multiple examples of Trump undermining multilateralism(Trump)

Pablo Arrocha Olabuenag, May 8, 2019, Why the Arms Trade Treaty Matters – and Why It Matters That the US Is Walking Away, https://www.justsecurity.org/63968/why-the-arms-trade-treaty-matters-and-why-it-matters-that-the-us-is-walking-away/

If anything, Trump’s announcement is congruent with his administration’s foreign policy approach, which has consistently attacked multilateralism and challenged international law. Examples of this pattern of conduct are the withdrawal from the Paris Agreement in June 2017; the withdrawal from UNESCO in October 2017; pulling out from the negotiations on the Global Compact on Migration in December 2017; the unilateral military attacks, together with France and the United Kingdom, against Syria in violation of the UN Charter in April 2018; pulling out of the U.N.’s Human Rights Council in June 2018; the withdrawal of both the Optional Protocol of the 1961 Vienna Convention of Diplomatic Relations and of the 1955 Treaty of Amity with Iran in October 2018; the withdrawal in February from the Intermediate-range Nuclear Forces (INF) treaty with Russia; or the recent decision to revoke the entry visa to the U.S. of Fatou Bensouda, the prosecutor of the International Criminal Court. In the case of U.S. withdrawal from the ATT, in addition to the political considerations associated with it, the decision is based on a clear misconception of what the treaty is and what it does. To better understand the gravity of this misguided decision, it is important to take a look at the history behind the treaty and at its content, especially its object and purpose.

Military expenditures increasing

Pablo Arrocha Olabuenag, May 8, 2019, Why the Arms Trade Treaty Matters – and Why It Matters That the US Is Walking Away, https://www.justsecurity.org/63968/why-the-arms-trade-treaty-matters-and-why-it-matters-that-the-us-is-walking-away/

In contrast, military expenditure is on the rise. According to the Stockholm International Peace Research Institute (SIPRI), the U.S. continues to be the top global exporter of arms and the 13th global importer (with Saudi Arabia holding the first position), with a total military expenditure in 2018 of $6.5 billion. This is more than 120 times the U.N. budget for the period 2018-2019.

The Arms Transfer Treaty (ATT) is not topical – it doesn’t reduce sales

Pablo Arrocha Olabuenag, May 8, 2019, Why the Arms Trade Treaty Matters – and Why It Matters That the US Is Walking Away, https://www.justsecurity.org/63968/why-the-arms-trade-treaty-matters-and-why-it-matters-that-the-us-is-walking-away/

The ATT at a glance What does the ATT do? As indicated by its name, the Arms Trade Treaty regulates the international licit trade of arms. Its object and purpose, which is clearly spelled out in Article 1, is the following: “The object of this Treaty is to: Establish the highest possible common international standards for regulating or improving the regulation of the international trade in conventional arms; Prevent and eradicate the illicit trade in conventional arms and prevent their diversion; for the purpose of: Contributing to international and regional peace, security and stability; Reducing human suffering; Promoting cooperation, transparency and responsible action by States Parties in the international trade in conventional arms, thereby building confidence among States Parties.” Other relevant aspects of the treaty to be highlighted are: i) its scope includes small arms and light weapons; ii) State Parties have the obligation to establish and maintain a national control system to regulate the export of ammunition/munitions; iii) the treaty establishes a system to conduct an assessment, including the consideration of possible mitigation measures, before authorizing an export of weapons; iv) it includes measures to prevent the diversion of arms, and v) it includes a yearly reporting mechanism of authorized or actual exports and imports of conventional arms. In a nutshell, the ATT sets out global standards to conduct legal and rightful activities in a transparent manner. This, in turn, helps to identify where and how arms are diverted into the illicit market and raises the bar regarding accountability for irresponsible transfers of arms. What does the ATT not do? It is not a disarmament treaty nor a treaty for the reduction of arsenals; it does not prohibit the international trade in arms, and; it does not regulate, in any way, internal transactions, in particular the acquisition of arms by civilians. Contrary to what Trump has declared, the treaty explicitly reaffirms “the sovereign right of any State to regulate and control conventional arms exclusively within its territory, pursuant to its own legal or constitutional system.” In other words, the ATT is absolutely silent on controls, regulations, limitations, rights or obligations regarding the domestic sale of arms. Therefore, claiming that the ATT breaches sovereign rights of States, specifically the second amendment to the U.S. Constitution, is not a matter of misinterpretation: It is simply not true.

New arms sale to Bahrain, including Patriot missile defense interceptors

Albawaba Gulf News, May 5, 2019, https://www.albawaba.com/news/us-approves-6-billion-weapons-sales-bahrain-and-uae-1283949 US Approves $6 Billion Weapons Sales to Bahrain and UAE

The US State Department announced the deal could see Bahrain potentially buy various Patriot missile systems and related support and equipment for an estimated cost of $2.48 billion. The deal could include 36 Patriot MIM-104E Guidance Enhanced Missiles known as GEM-T, an upgrade that can shoot down aircraft and cruise missiles, Reuters reported. Bahrain was also approved for a deal that would include a range of weapons to support its F-16 Block 70/F-16V aircraft fleet for an estimated cost of $750 million. That package included 32 AIM-9X missiles, 20 AGM-84 Block II Harpoon missiles and 100 GBU-39s which are 250-pound small diameter bombs and other munitions Separately, the UAE was given an initial approval for $2.73 billion worth of Patriot missiles and related equipment including 452 Patriot Advanced Capability 3 (PAC-3) Missiles Segment Enhanced (MSE) and related equipment.

Russia’s defense industrial base is in decline now, rebound critical to Russian military power projection.   Arms sales are critical to the base, but those sales are also declining now

Stratfor Worldview, May 5, 2019, https://nationalinterest.org/blog/buzz/russia-makes-some-deadliest-weapons-earth-there-problem-55812 Russia Makes Some of the Deadliest Weapons on Earth (But There Is a Problem) DOA: 5-5, 19

Russia’s defense industry is face to face with a major foe, but it’s not a foreign military power. The Kremlin has been striving to modernize all branches of the Russian military, but the country’s defense industry is struggling thanks to decreasing volumes of orders, difficulties in attracting high-skilled talent and limits to its technological capabilities. According to recent figures, the performance of Russia’s aerospace sector is declining precipitously. In 2018, for instance, Russian aircraft and spacecraft makers produced 13.5 percent less than in 2017. And there’s been no letup in 2019 either: In the first two months of the year, aerospace output plummeted 48 percent year on year. The decline in Russia’s defense output raises concerns about the competitive strength of Russia’s defense industry in general, whose health is critical if the country is to project itself as a military power in the longer term. Russian Deputy Prime Minister Yuri Borisov attributed the reduction in output to a slowdown of orders for military systems, but projections suggest the slowdown is not just a short-term fluctuation; in fact, it’s expected to become even worse in the future. The downturn in oil prices has taken a bite out of Russia’s bottom line, squeezing spending for the military — all at a time when the country’s arms manufacturers have lost their competitive edge in the global arms market. Together, these factors ensure that Russia’s defense industry will struggle to get out of its funk. Suffering From a Dearth of Funds 10 SECONDS Do You Know What Happened On This Day? This dire picture stands in stark contrast to Russia’s frequent presentation of sensational new platforms. In reality, however, just a few of the big-ticket weapon systems — such as the T-14 main battle tank or the Su-57 fighter aircraft — find buyers, as the rest remain mere prototypes. Russia has prioritized some hardware, such as the Sarmat intercontinental ballistic missile, due to their strategic relevance to the country’s overall military posture, but Moscow has failed to fully develop other programs or only introduced them on a limited scale. Under pressure from a limited government budget, the Kremlin even started reducing its military spending in 2017 — a strong indicator that, despite the modernization push, Russia’s financial challenges are taking a toll on the country ambitions. Economically, the plunge in oil prices at the end of 2014 hurt Russia’s bottom line, depriving the country of essential revenue and forcing it to dip into its reserves to bridge the gap. Today, more than four years on, Russian oil revenues are rising, yet the country is continuing to deal with the consequences of the lean years. Beyond that, low revenues from taxes, which have forced Russia to raise taxes and the retirement age, and Western sanctions over Moscow’s activities in Ukraine and elsewhere, have shrunk the financial pool available to military planners. Report Advertisement But the Kremlin’s problems don’t end there. In the past, Russia has benefited from its position as a major global arms exporter to fuel further military development. During the 1990s, for example, such sales were critical to the country as it faced severe economic hardship. While Russia remains the world’s second-largest arms exporter (only the United States sells more), the actual value of those exports has been decreasing significantly. Between 2014 and 2018, their total value dropped by as much as 17 percent. Again, budgetary limits are somewhat to blame: In the past, Russia frequently used arms exports as a political tool, offering weapons at a heavy discount, if not entirely free. But with Russia no longer able to offer customers a good deal on its fighter jets and other defense products, the country is losing business.

Countries that can’t buy US arms will switch to Russia

Ray Rounds, April 16, 2019, THE CASE AGAINST ARMS EMBARGOS, EVEN FOR SAUDI ARABIA, https://warontherocks.com/2019/04/the-case-against-arms-embargos-even-for-saudi-arabia/ Lt. Col. Ray Rounds is a U.S. Air Force F-15E pilot and a Ph.D. candidate at Georgetown University in International Relations. He is a U.S. Air Force School of Advanced Air and Space Studies graduate and a former Mirage 2000 exchange pilot with the French Air Force

Senior U.S. government officials involved in the arms transfer process that I interviewed over the past year during the course of my research have echoed similar sentiments. This is also borne out by previous research providing evidence that using arms transfers as situationally coercive tools is rarely successful. Interestingly, coercion attempts using arms transfers are least likely to be successful when used as a punishment or threat against an autocratic regime, such as Saudi Arabia. Instead, punishments in the form of an embargo can often push a client to diversify sourcing rather than to change behavior. Consider Indonesia and Egypt. In 2015, Egypt agreed to purchase nearly 50 Russian MiG-29M/M2s and more than two-dozen French Rafales. This represented a shocking turn of events after more than three decades of purchasing only American-made fighter jets. It was also driven largely by the U.S. embargo put in place in 2013, after the Egyptian army’s removal of then-President Mohamed Morsi, who had won the presidency in a 2012 election. The embargo caused significant tension between the two states driven by “an Egyptian sense that they were at a point of mortal peril” while the United States was moralizing about democratic reforms. Remarkably, the United States lifted the embargo in 2015 with virtually no change in Egyptian policies, no official U.S. “democracy certification”, and Egyptian military support for the Saudi-led war in Yemen. The U.S. arms embargo as a tool of coercive change was an abject failure. A similar story played out in Indonesia more than a decade prior. A long-time arms client of the United States with no history of Russian imports, Indonesia announced a deal with Russia in 2003 to purchase Russian Su-27/30s. While Indonesia was always far more politically neutral than Egypt, this remarkable turnaround in arms sourcing diversification appears to be the result of a U.S. arms embargo implemented in 1999 in response to Indonesia’s apparent human rights violations carrying out heavy-handed military actions in East Timor. Furious at U.S. meddling in something the government considered a domestic issue, Indonesia looked instead to Russia with the specific intent to “overcome the effects of [U.S.] arms sales restrictions.” In other words, Indonesia looked to diversify, not capitulate. Indonesia continued sourcing Russian arms even after the United States lifted the embargo in 2005. Perhaps most remarkably, even after the United States agreed to give Indonesia 24 F-16s in 2012, the archipelago state still agreed to purchase 11 Russian Su-35s. The U.S. attempt at coercion not only failed but continues to perpetuate negative strategic effects today.

Russia competes with the US for sales. Reducing sales creates a greater opportunity for Russia

NNicholas Parasie, April 6, 2019, https://www.wsj.com/articles/russia-and-china-target-middle-east-arms-deals-11554555600, Russia and China Target Middle East Arms Deals

Russia has sold missile systems to the U.A.E. and military rifles to Saudi Arabia in return for the right to produce the weapons in the kingdom. Saudi Arabia and the U.A.E. have also bought Chinese military drones. Big Spenders Countries in the Middle East and their NorthAfrican neighbors are ramping up defensespending, including for more hardware .billion Defense spending Military equipment spending 2010 ’12 ’14 ’16 ’18 ’20 ’22 0 50 100 150 200 $250 China and Russia are willing to sell arms and equipment, such as drones, to some Mideast countries when other countries are reluctant to do so because of weapons-proliferation concerns, or, in the case of the U.S., a policy of giving its ally Israel a military edge. The arms competition reflects growing tensions between the U.S. and its strategic rivals China and Russia over trade, security and other matters in a region the U.S. has long considered its sphere of influence. The U.S. Department of Defense isn’t only concerned about the threat to U.S. arms sales but also that China and Russia are trying to gain know-how about advanced military equipment and commercial technologies by working with U.S. allies, Pentagon officials said. These officials say the shift complicates future deals with Washington’s Persian Gulf allies since the competing hardware may be incompatible with Western systems. Russia and China have been laying down both military and economic roots in the region. This 2017 image shows Chinese People’s Liberation Army members attending the opening ceremony of China’s military base in Djibouti, not far from a U.S. facility. PHOTO: AGENCE FRANCE-PRESSE/GETTY IMAGES In the past couple of years, China set up a military base in the East African nation of Djibouti, across the Gulf of Aden from Yemen, in proximity to a U.S. facility the Pentagon uses for sensitive military operations, including drone strikes and special operations missions. Defense spending Source: IHS Markit Note: Data are estimates. Defense spending includescost of troops, operations, infrastructure andequipment. .billion Beijing has also pressed for closer economic ties, hosting Saudi Crown Prince Mohammed bin Salman in February and announcing a flurry of agreements ranging across energy, investment and counterterrorism. Last year Chinese President Xi Jinping visited the U.A.E., signing 13 deals. “In terms of technology [the Chinese] are incredibly good, and they have more financial strength” than many rivals, said Alessandro Profumo, chief executive of Italian aerospace and defense equipment maker Leonardo SpA, which has sold combat aircraft and military helicopters in the Middle East. Such strength allows China to offer flexible payment terms for its customers, helping it to clinch deals particularly in less wealthy countries. Russia, the world’s second-biggest arms exporter after the U.S., has made its own push for influence in the Middle East following its military action in Syria since 2015 to keep President Bashar al-Assad in power. Russian oil companies like PAO Rosneft have struck deals from Iraq to Libya, while Kremlin-connected firms have pushed for Syrian reconstruction business. The Trump administration has made arms sales to Persian Gulf allies, particularly Saudi Arabia, a centerpiece of its foreign policy. President Trump has resisted U.S. senators’ calls to restrict arms transfers to Saudi Arabia following the killing of journalist Jamal Khashoggi, which the Central Intelligence Agency said was likely ordered by Saudi Crown Prince Mohammed bin Salman. Saudi Arabia denies that. U.S. officials say they believe American technology gives its contractors an edge in the region. They have warned their Middle East allies not to become too enamored with the Chinese and Russian partnerships, saying it could threaten cooperation with the U.S. military, industry officials said. The pressure has had mixed results. Washington failed to persuade Turkey to abandon the purchase of Russia’s S-400 air- and missile-defense system. Its manufacturer, Rostec State Corp., says it can shoot down aircraft at a range of up to 240 miles. Saudi Arabia has held talks with Russia over buying the system, too. Prince Mohammed, left, spoke with Russian President Vladimir Putin during a G20 summit in Buenos Aires in November. PHOTO: NATACHA PISARENKO/ASSOCIATED PRESS Sergey Chemezov, Rostec’s chief executive, recently told reporters he wouldn’t discuss the status of those talks because of the pressure Washington has placed on prospective buyers of Russia equipment. Representatives for Saudi Arabia didn’t respond to requests for comment. Mr. Chemezov said Rostec is in talks with the U.A.E. about the company’s new warship-based antiaircraft system. China North Industries Group Corp., known as Norinco, meanwhile, announced plans in February to join forces with U.A.E. defense company International Golden Group PJSC to set up a research joint venture. Financial terms of the deal weren’t disclosed. Under the pact, the two partners will open a facility in Abu Dhabi staffed by Chinese and Emirati engineers. The program will develop weapons and training with the help of Chinese and Emirati universities and in cooperation with the U.A.E. armed forces. The center’s first project will focus on drones that can be used for both surveillance but also offensive purposes, an Emirati official said.

Russia will not impose conditions for arms sales exports

Fazan Hashaimi, May 5, 2019, https://www.urdupoint.com/en/world/russia-does-not-set-extra-political-economic-613358.html, Russia Does Not Set Extra Political, Economic Conditions For Arms’ Sales – Official

MOSCOW (UrduPoint News / Sputnik – 05th May, 2019) Russia is the only country on the arms’ market which does not set additional political, or economic conditions for sales of weapons, Maria Vorobyeva, the spokeswoman of the Federal Service for Military-Technical Cooperation (FSMTC), said on Sunday.

“In the dynamically developing countries of Asia and Latin America, the public now demands from its leadership transparency and independence in matters of military-technical cooperation and national security… [Russia is] the only [country] among the leaders of [the arms’ sales] market which does not set additional political or economic conditions when striking contracts,” Vorobyova said. According to the official, Russia is ready for an open dialogue with all legitimate governments in all areas and formats.

Russia lags far behind the US in arms sales now

Radio Free Europe, March 11, 2019, https://www.rferl.org/a/us-russia-lead-world-global-arms-exports/29814176.html, U.S. Remains World’s Top Arms Exporter, With Russia A Distant Second

The United States remained far and above the rest of the world as the globe’s leading arms exporter, with Russia a distant second, a leading research group says. The Stockholm International Peace Research Institute (SIPRI) said in a March 11 report that the gap between the United States and the rest of the world widened further in the most recent five-year period of 2014-18, with American exports rising to 36 percent of the global total from 30 percent in the previous period. “The U.S.A. has further solidified its position as the world’s leading arms supplier,” said Aude Fleurant, director of the SIPRI Arms and Military Expenditure Program. “[It] exported arms to at least 98 countries in the past five years; these deliveries often included advanced weapons such as combat aircraft, short-range cruise and ballistic missiles, and large numbers of guided bombs.” The report highlighted the widening gap between Washington and Moscow in arms exports. “U.S. exports of major arms were 75 percent higher than Russia’s in the 2014–18 period, while they were only 12 percent higher in 2009-13,” SIPRI said in its report of global arms transfers. “More than half (52 percent) of U.S. arms exports went to the Middle East in 2014-18,” it added. SIPRI said Russia’s arms exports fell 17 percent in the 2014-18 period, with a reduction in arms imports by India and Venezuela the major factors in the decline. The report said France (6.8 percent of the world total) was the third-highest arms exporter, followed by Germany (6.4 percent), and China (5.2 percent). The top five countries accounted for 75 percent of the world total, the report said. The combined total of European Union nations came to 27 percent of the global figure. Among arms importers, Saudi Arabia was the leader, with 12 percent of the world total, up from 4.3 percent in the previous five-year period. Its total imports rose 192 percent in the most-recent period. “Arms imports by some Arab states of the Gulf rose sharply [during the period],” the report said. “Among the key reasons behind these increases were the mutual distrust between Iran on the one hand and Saudi Arabia and the [United Arab Emirates] on the other.” It also cited the conflict in Yemen, considered by many to be a proxy war between Iran and Saudi Arabia, and the hostilities between a Saudi-led Arab coalition against tiny Gulf state Qatar. Pakistan was the 11th top importer with 2.7 percent of the global total, but it represented a sharp decline from 4.8 percent previously. Its main suppliers were China (70 percent), the United States (8.9 percent), and Russia (6 percent). Its rival India was the second-largest importer, with Russia (58 percent), Israel (15 percent), and the United States (12 percent) the top suppliers. In a report released in December 2018, SIPRI said arms exports by U.S. companies in 2017 amounted to $222.6 billion, while Russia had $37.7 billion in arms exports for that one year.

Maintenance is a part of Direct Commercial Sales

Ryan Goodman, 10-22, 18, https://www.justsecurity.org/61172/effective-ineffective-congressional-responses-saudi-arabia-arm-sales-sanctions-khashoggi/,

Options for Congress to Respond to Saudi Transgressions: Here’s What Works according to Former Senior U.S. Officials [Ryan Goodman (@rgoodlaw) is founding co-editor-in-chief of Just Security. He is the Anne and Joel Ehrenkranz Professor of Law at New York University School of Law. He served as Special Counsel to the General Counsel of the Department of Defense (2015-16). Ryan is also a Professor of Politics and Professor of Sociology at NYU. He was the inaugural Rita E. Hauser Professor of Human Rights and Humanitarian Law at Harvard Law School. He received a J.D. from Yale Law School, a Ph.D. from Yale University, and a B.A. from the University of Texas at Austin. He is a member of the Department of State’s Advisory Committee on International Law, a member of the Council on Foreign Relations, a member of the US Naval War College’s Board of Advisers for International Law Studies, and a member of the Board of Editors of the American Journal of International Law.]

I focused my conversations with former U.S. officials and other experts on the following set of options: Bar future foreign military sales(FMS) relating to air-to-ground strike capabilities for operations in Yemen (e.g., precision-guided munitions) Suspend existing Direct Commercial Sales (DCS) licenses relating to air-to-ground strike capabilities for operations in Yemen (e.g., for maintenance and sustainment of fighter aircraft)

Sanctions don’t stop sales

Tomoyo Ogawa, February 3, 2019, https://asia.nikkei.com/Politics/Russia-vies-with-US-as-it-steps-up-arms-exports-to-Southeast-Asia, Russia vies with US as it steps up arms exports to Southeast Asia DOA: 5-5-19,

Even after international economic sanctions were imposed on Russia in response to its invasion of Ukraine in 2014, arms exports have remained a steady revenue source for Moscow.

Non-unique: Russia can’t compete with China

Stratfor Worldview, May 5, 2019, https://nationalinterest.org/blog/buzz/russia-makes-some-deadliest-weapons-earth-there-problem-55812 Russia Makes Some of the Deadliest Weapons on Earth (But There Is a Problem) DOA: 5-5, 19

And Russia’s arms industry faces an even greater problem in the years to come: reduced competitiveness. Russia has long dominated some of the market by offering affordable military equipment without attaching any conditions regarding human rights, but the rise of China’s military industry, as well as several smaller producers around the world, has made it much more difficult to compete for contracts.

Declining sales snowball – lower sales increase cost of production, meaning higher prices and low sales

Stratfor Worldview, May 5, 2019, https://nationalinterest.org/blog/buzz/russia-makes-some-deadliest-weapons-earth-there-problem-55812 Russia Makes Some of the Deadliest Weapons on Earth (But There Is a Problem) DOA: 5-5, 19

Ultimately, the loss of export opportunities not only complicates Russia’s efforts to finance its defense industry, it also reduces the scale at which the defense industry produces, which, in turn, decreases scale-dependent savings that accompany higher levels of production. In effect, this means that the more Russia fails to find foreign customers for specific weapon systems, the more it will become burdened with a higher relative cost per unit as it seeks to meet its own needs. The conundrum, in turn, will further limit Russia’s ability to competitively price weapons systems for export, thereby perpetuating the effect.

Russia wants to export more SU-27s

Stratfor Worldview, May 5, 2019, https://nationalinterest.org/blog/buzz/russia-makes-some-deadliest-weapons-earth-there-problem-55812 Russia Makes Some of the Deadliest Weapons on Earth (But There Is a Problem) DOA: 5-5, 19

This is why, for example, India’s withdrawal from the joint development and production of the Su-57 fighter aircraft last year has cast doubt on Russia’s ability to sustain the program in a meaningful way or at an acceptable cost. As a result, Russia has sought — albeit unsuccessfully so far — to export the Su-57 more widely in an effort to find a partnership that would make the aircraft viable.

Russia’s defense industry can’t support itself through civilian production

Stratfor Worldview, May 5, 2019, https://nationalinterest.org/blog/buzz/russia-makes-some-deadliest-weapons-earth-there-problem-55812 Russia Makes Some of the Deadliest Weapons on Earth (But There Is a Problem) DOA: 5-5, 19

Russia, accordingly, has been considering other solutions to safeguard its defense sector and improve its overall industrial performance. One possible remedy centers on what amounts to burden sharing across sectors. In this, the country is looking to harness the defense industry’s strengths for civilian production, similar to the way Western enterprises such as Boeing or Airbus operate. By producing non-military products for domestic and foreign civilian markets, Russian defense manufacturers could sustain themselves even if their military goods are earning less revenue. Unfortunately for Russia, the chances that such a gambit will succeed are low — even for domestic consumption. Although Moscow has been pushing an import substitution program amid the West’s sanctions, Russian firms continue to privilege foreign, instead of domestic, components. In 2018, 38 percent of Russian industrial enterprises purchased equipment from abroad; two years before, the figure was just 6 percent. Ultimately, if Russian arms producers are failing to find sales for defense customers at home, they’re unlikely to find any more of a domestic civilian market for their wares. As a great power, Russia has lofty ambitions for the modernization of its military. Budget constraints, more competition from elsewhere and other issues, however, mean many of the army’s most ostentatious projects never make it past the showroom. And moving forward, the Russian defense industry’s plight is unlikely to improve as it faces a vicious circle that is leaving it worse for wear.

6 Billion in new missile defense sales

Reuters, May 3, 2019, https://www.reuters.com/article/us-usa-defense-arms/state-department-oks-nearly-6-billion-in-weapons-sales-to-gulf-allies-idUSKCN1S924P. State Department OKs nearly $6 billion in weapons sales to Gulf allies

WASHINGTON (Reuters) – The U.S. State Department has approved a possible $6 billion worth of weapons sales to Bahrain and the United Arab Emirates in three separate packages, the Pentagon said on Friday after notifying Congress of the certification. The United States depends on allies in the region, including Saudi Arabia, to counter Iranian influence. In April, the U.S. moved ahead with part of a THAAD missile defense system sale to the kingdom. In one of the notifications sent to Congress on Friday, Bahrain could potentially buy various Patriot missile systems and related support and equipment for an estimated cost of $2.48 billion. That potential Bahraini deal included 36 Patriot MIM-104E Guidance Enhanced Missiles known as GEM-T, an upgrade that can shoot down aircraft and cruise missiles.

China’s arms sales increasing

Secrecy News Now, May 3, 2019, Rising China Sells More Weapons, https://fas.org/blogs/secrecy/2019/05/china-weapons/

“In 2018, China’s arms sales increased, continuing a trend that enabled China to become the world’s fastest-growing arms supplier during the past 15 years,” according to the 2019 China Military Power report published by the Department of Defense. “From 2013 through 2017, China was the world’s fourth-largest arms supplier, completing more than $25 billion worth of arms sales.”

China uses arms sales to promote political influence

Secrecy News Now, May 3, 2019, Rising China Sells More Weapons, https://fas.org/blogs/secrecy/2019/05/china-weapons/

“Arms transfers also are a component of China’s foreign policy, used in conjunction with other types of military, economic aid, and development assistance to support broader foreign policy goals,” the Pentagon report said. “These include securing access to natural resources and export markets, promoting political influence among host country elites, and building support in international forums.”

Middle East defense spending very high – 10% of GDP

Micah Halpern, May, 2, 2019 Halperin is a political and foreign affairs commentator. He founded “The Micah Report” and hosts “Thinking Out Loud with Micah Halpern” a weekly TV program and “My Chopp” a daily radio spot. A dynamic speaker, he specializes in analyzing world events and evaluating their relevance and impact,, https://www.newsmax.com/micahhalpern/trump-weapons-sales-saudi-arabia-yemen/2019/05/02/id/914313/ The Complicated Story of Weapons Sales in the Middle East

Most countries in the Middle East spend approximately 10%, sometimes even more, of their GDP on defense — especially on the purchasing of weapons. Oman spends 11% and Saudi Arabia spends 10.8%. Afghanistan spends 10.1% of its budget on defense Seven out of the top ten defense spenders are Middle East countries and ten out of the fifteen largest spenders are from the Middle East and North Africa.

US controls 36% of the global arms trade

Micah Halpern, May, 2, 2019 Halperin is a political and foreign affairs commentator. He founded “The Micah Report” and hosts “Thinking Out Loud with Micah Halpern” a weekly TV program and “My Chopp” a daily radio spot. A dynamic speaker, he specializes in analyzing world events and evaluating their relevance and impact,, https://www.newsmax.com/micahhalpern/trump-weapons-sales-saudi-arabia-yemen/2019/05/02/id/914313/ The Complicated Story of Weapons Sales in the Middle East

Weapon sales in the Middle East are up 87% according to a study on global weapons by the Stockholm International Peace Research Institute (SIPRI). In the breakdown U.S. sales to the Middle East increased by 29%. Russia increased their sales dramatically, too. But the United States still maintains a significant lead in the world market share of weapon trade, controlling 36% of world trade while Russia sits at 21%.

US weapons are given away to others

Micah Halpern, May, 2, 2019 Halperin is a political and foreign affairs commentator. He founded “The Micah Report” and hosts “Thinking Out Loud with Micah Halpern” a weekly TV program and “My Chopp” a daily radio spot. A dynamic speaker, he specializes in analyzing world events and evaluating their relevance and impact,, https://www.newsmax.com/micahhalpern/trump-weapons-sales-saudi-arabia-yemen/2019/05/02/id/914313/ The Complicated Story of Weapons Sales in the Middle East

The biggest worry with the sale of weapons in general is that that the weapons sold to certain countries are then resold or simply given away. And when that happens those weapons may — and sometimes do, end up in the hands of enemies of the West Transferring, selling or in any way giving U.S. weapons that were officially purchased from the United States is a violation of numerous agreements as well as a violation of the weapons deal itself. But that itself is not enough of a deterrent for many nations. And besides, most of the purchased weapons are not essential and not needed for the defense of the countries that purchased them

Arms sales substantially boost defense industry profits

Mike Stone, 4-25, 19,     https://www.scmp.com/news/china/diplomacy/article/3007446/beijing-says-washingtons-us500-million-arms-sale-taiwan, Trump’s Policies Lift Lockheed Martin’s Profit, Shares Surge

Lockheed Martin Corp. reported better-than-expected quarterly profit on April 23 as President Donald Trump’s looser policies on foreign arms sales boosted demand for missiles and fighter jets.

ADVERTISING The Pentagon’s biggest weapons supplier is the first major defense company to report quarterly earnings this week, which Wall Street expects to be higher than a year ago as global demand for arms rises. Trump’s administration has proposed an increase in U.S. defense spending for the next fiscal year. Lockheed shares rose nearly 7 percent in their best one-day percentage rise since October 2016. Investors bet on similar results from the whole sector, pushing Northrop Grumman Corp., Raytheon Co., and General Dynamics Corp. shares up more than 2.7 percent. Lockheed’s Missiles and Fire Control business, which makes missile defenses like the Terminal High Altitude Area Defense (THAAD), was one of its best-performing units. On April 1, in a deal that was partially brokered by Trump, the unit was awarded a THAAD interceptor missile contract worth $2.4 billion, many of which are slated to be delivered to Saudi Arabia. Chief Financial Officer Kenneth Possenriede told investors on a post-earnings conference call that profits for the unit for the rest of the year would not be as strong, “a little north of 13 percent margin,” because of investments in future programs. Overall, the Bethesda, Maryland-based company said its earnings rose to $1.70 billion, or $5.99 per share, in the first quarter ended March 31, from $1.16 billion, or $4.02 per share, a year earlier. That was partly helped by a $75 million dollar boost from additional tax deductions on foreign military sales, part of Trump’s tax cut that came into effect last year. Excluding that one-time gain, Lockheed reported $5.73 per share profit, well ahead of the $4.34 per share that Wall Street had expected, on average, according to IBES data from Refinitiv. The company had a 12.4 percent tax rate in the first quarter but Possenriede said he expected its 2019 tax rate to be 15.5 percent. Lockheed’s overall net sales for the quarter rose 23 percent to $14.34 billion. The company’s sales backlog grew to $133.5 billion, up 3 billion over the quarter.

Arms sales sustained by global capitalism, it’s the root cause

Vijay Prashad, 4-25, 19, https://therealnews.com/if-war-is-an-industry-how-can-there-be-peace-in-a-capitalist-world-the-seventeenth-newsletter-2019, If War Is an Industry, How Can There Be Peace in a Capitalist World? The Seventeenth Newsletter (2019).

Global military spending is over $2 trillion, with the United States by itself spending almost half this amount. Total US military spending is now at $989 billion. This number includes not only the formal expenditure on the US military, but also expenditure on the Veteran’s Administration, the Department of Energy, the National Nuclear Security Administration, the Cybersecurity component of the Department of Justice, Homeland Security and the military aspects of the State Department. It does not include the immense secret budget of the National Security Agency and the Central Intelligence Agency. Add these up and the US military budget is already over $1 trillion, as our friends at Monthly Review found in 2007. The United States spends more on its military than the next nine highest-spending countries combined: China, Saudi Arabia, Russia, India, France, United Kingdom, Japan, Germany and South Korea. ‘Security’ or ‘deterrence’ are not the main aims of such formidable military spending. A world awash with weapons leads to tragedies, such as the recent massacre in Sri Lanka, where military-grade explosives were used in the terrible murder of over three hundred and fifty innocent people. Focus on the arms industry is sporadic, with the Stockholm International Peace Research Institute (SIPRI) and others like it lonely in their work. Recent reports from SIPRI show that the volume of arms transfers – a major part of the business of the arms trade – has been rising over the years, with the United States, Russia, France, Germany and China as the biggest exporters of weapons (they account for 75% of all world arms sales). The United States, by itself, sells 36% of the world’s arms – with a focus on combat aircraft, short-range cruise missiles and ballistic missiles and guided bombs. The top ten arms companies in the world are: Lockheed Martin ($44.9 billion) [USA] Boeing ($26.9 billion) [USA] Raytheon ($23.9 billion) [USA] BAE Systems ($22.9 billion) [UK] Northrop Grumman ($22.4 billion) [USA] General Dynamics ($19.5 billion) [USA] Airbus Group ($11.3 billion) [Europe] Thales ($9 billion) [France] Leonardo ($8.9 billion) [Italy] Almaz-Antey ($8.6 billion) [Russia] Why do governments spend such a vulgar amount on weapons? In his monumental Grundrisse (1857), Karl Marx made the offhand, but accurate remark, ‘The impact of war is self-evident, since economically it is exactly the same as if the nation were to drop a part of its capital into the ocean’. A permanent war economy is a waste, even if there are massive profits to be made by these warfare companies. So much can be done with $2 trillion – a mere $30 billion per year to end world hunger, as the UN Food and Agricultural Organisation noted in 2008. Last year, the UN began a campaign to raise $10 billion to eradicate illiteracy. But even these meagre funds have been impossible to raise, the promise of ‘billions into trillions’ from the much-heralded public-private partnerships falling flat. There is always money for war, but never enough money to build the scaffolding for peace. There is always the illusion that military spending is for security, when it appears to be more for profit. The entire industry is lubricated with bribes. Joe Roeber of Transparency International said that the arms trade is ‘hard-wired for corruption’. ‘In 1997, I was told in Washington that a mid-nineties report by the CIA concluded’, he wrote, that ‘arms trade corruption then accounted for 40-45% of the total corruption in world trade’. The national security argument, Roeber suggested, ‘throws a veil of secrecy around arms deals’, whose scale is so large that even small percentages of bribes make for large dollar amounts. Bribery is normal, the deals that are revealed are startling – bribes running from $300 million (the South African-BAE deal from 1997-98) to $8 billion (the Saudi-BAE deal from 1985-2007).

Base link – Trump withdrew from the arms sales treaty to pander to his base

Mark Porubcansky has been a foreign correspondent and editor for 30 years, serving until recently as foreign editor of the Los Angeles Times, April 29, 2019, https://www.minnpost.com/foreign-concept/2019/04/trumps-decision-to-pull-out-of-the-arms-trade-treaty-a-cynics-guide/ Trump’s decision to pull out of the Arms Trade Treaty: a cynic’s guide

There are three ways to think about President Trump’s decision to pull the United States out of an agreement regulating the conventional arms trade. Each will feed your inner cynic, but only two seem true. One in particular explains a lot about how the world works. Trump announced the decision Friday at the annual convention of the National Rifle Association, which long has argued that the treaty signed by President Obama in 2013, but not ratified by the Senate, could affect Americans’ gun rights. “We will never allow foreign bureaucrats to trample on your Second Amendment freedoms,” Trump declared. The announcement was an easy win for the NRA, and shifted some attention from its dire financial troubles. (The battle between Oliver North and Wayne LaPierre for control of the NRA that broke into the open at the convention is just the tip of a very large iceberg, and if you haven’t read Mike Spies’ eye-opening investigation into NRA finances in the New Yorker this month, it’s well worth your time.) Briefly, the Arms Trade Treaty requires countries to monitor arms sales and prohibits them from selling arms in violation of U.N. embargoes, if it’s likely the weapons would be used to commit war crimes or fall in the hands of terrorists or organized crime groups. Its effect has been fairly limited. The Arms Control Association says the treaty “does not place restrictions on the types or quantities of arms that may be bought, sold, or possessed by states. It also does not impact a state’s domestic gun control laws or other firearm ownership policies.” In other words, it’s a Second Amendment issue only if you believe the Constitution gives Americans the right to sell virtually any weapon to anyone anywhere in the world at any time. So perhaps the whole point of Trump’s announcement was to pander to his base. In a bit of political showmanship, he signed a request for the Senate to return the treaty to him while on the NRA stage and then tossed the pen into the crowd. Pandering probably is part of the explanation. But it’s not the only reason, and perhaps not the main one.

US dominates the global arms sales market, US sales decreasing

Mark Porubcansky has been a foreign correspondent and editor for 30 years, serving until recently as foreign editor of the Los Angeles Times, April 29, 2019, https://www.minnpost.com/foreign-concept/2019/04/trumps-decision-to-pull-out-of-the-arms-trade-treaty-a-cynics-guide/ Trump’s decision to pull out of the Arms Trade Treaty: a cynic’s guide

The United States is by far the world’s largest arms seller. And you can’t blame Trump for that. At least you can’t solely blame Trump for that. U.S. arms sales grew rapidly under Obama. The Stockholm International Peace Research Institute, which monitors global arms sales, said in a March report that the U.S. accounted for 36 percent of global exports of major weapons in the period 2014-2018, up from 30 percent in the previous five-year period. It sold major weapons to 98 countries. Russia had 21 percent of the market, a significant drop from the previous period. No other country supplies more than 7 percent.

Firearms exports are dangerous and the arms could end up in the hands of terrorists

Bloomberg Opinion, 3-22, 19, https://www.ohio.com/opinion/20190422/other-views-dont-ease-export-rules-on-firearms Other Views: Don’t ease export rules on firearms

President Donald Trump, who has received unprecedented support from America’s gun lobby, seems determined to make it easier to export firearms and harder to keep track of whether they’re destined for terrorists or rogue regimes. He proposes to do this by shifting oversight of the export of semi-automatic and non-automatic firearms, as well as of various gun components and some types of ammunition, from the Department of State to the Department of Commerce. The change threatens to undermine national security and public safety around the world. Congress should stop it from taking effect. The U.S. is already the world’s biggest firearms exporter, shipping roughly $7.5 billion worth of guns, artillery and ammunition from 2013 to 2017. Some of this equipment has ended up with al-Qaida fighters and other terrorists, undermining the struggle to keep lethal weapons out of the hands of America’s enemies. Under the current system, State Department licensing officers too often approve export applications that lack required information, a department inspector general has found. In one instance, approval was granted to sell 400,000 rifles, along with more than 500 million rounds of ammunition and other equipment, to the Philippines Bureau of Customs – without notification to Congress, as required by law. Subsequent investigation found that licensing information was missing and the transaction’s intermediary had “disappeared.” If licensing responsibility shifts to the Commerce Department, such lapses stand to become more frequent. Commerce lacks the specialized staff and expertise to vet arms sales, and has no plan to acquire them. Commerce officials have already indicated they will not feel obligated to notify Congress, as the State Department must, when gun exports are valued at more than $1 million. It’s unclear whether the Commerce Department would even suspend sales to a buyer found to be operating illegally or in contravention of U.S. foreign policy aims. The Trump administration also plans to end State Department oversight of the publication of computer code enabling 3D printable guns. That would make it easier for people inside and outside the U.S. to make untraceable firearms at home and, like the change to gun-export authority, make guns more plentiful and difficult to regulate. Democratic Reps. Eliot Engel, D-N.Y., and Norma Torres, D-Calif., are proposing legislation to block the changes to oversight of weapons for export and 3D printable guns. Congress should pass it without delay.

Aid to Israel is used to purchase US weapons

Mitchell Plitnick, April 22, 2019, https://lobelog.com/u-s-aid-to-israel-what-you-need-to-know/, U.S. Aid To Israel: What You Need To Know

The changes Obama made to the U.S. aid arrangement increase the urgency for any activists who want to try to pressure Israel through aid. The Israeli defense budget for 2019 is 63 billion shekels, or roughly $17.5 billion. U.S. aid represents about 22 percent of that budget, making aid a tempting target. But it’s a goal that is not so easy to achieve. U.S. military aid to Israel has always been, to a large degree, a government subsidy to U.S. weapons and military equipment industries. Under the Bush MOU, that subsidy was 73.7 percent of $3 billion each year, or $2.211 billion. Now, it will be 100 percent of $3.8 billion by 2028. There is also the aid money to Egypt and Jordan, which derives from their respective peace agreements with Israel. Arms sales to the Gulf states also rise as Israel’s own military capabilities improve. These factors will mean even more intense lobbying from the defense industry to maintain the status quo and, therefore, the perceived need for a heavily armed Israel.

Strong political support for aid to Israel, requiring the expenditure of political capital

Mitchell Plitnick, April 22, 2019, https://lobelog.com/u-s-aid-to-israel-what-you-need-to-know/, U.S. Aid To Israel: What You Need To Know

U.S. military aid to Israel has always been, to a large degree, a government subsidy to U.S. weapons and military equipment industries. Under the Bush MOU, that subsidy was 73.7 percent of $3 billion each year, or $2.211 billion. Now, it will be 100 percent of $3.8 billion by 2028. There is also the aid money to Egypt and Jordan, which derives from their respective peace agreements with Israel. Arms sales to the Gulf states also rise as Israel’s own military capabilities improve. These factors will mean even more intense lobbying from the defense industry to maintain the status quo and, therefore, the perceived need for a heavily armed Israel. The new aid terms will also deepen Israel’s need to make sure that Congress remains fully on board with the annual aid package. The loss of the OSP exception means the discontinuation of some $780 million injected annually into Israel’s weapons industry. In the long term, that could end up strengthening Israel’s economy, developing its private sector more robustly, especially through increases in the already deep partnerships with American corporations. But in the short term, it will be a key loss. The elimination of the OSP exception and the increase in aid will make Israel’s defense budget more dependent than ever on the United States. Israel’s private-sector efforts to merge with U.S. corporations and to establish U.S. subsidiary corporations might eventually mitigate that loss, but for the next few years, Israel will be more vulnerable to pressure. That’s not a concern now, with Donald Trump in the White House, firm Republican control of the Senate, and pro-Israel Democrats entrenched in the House leadership. But in 2020, the calculus could begin to shift, given the growing unease with Israeli aggression among younger and more progressive Democrats. As counter-intuitive as it might seem, the time to challenge aid to Israel, if that is the strategic choice, is now, during the Trump administration. The current Democratic leadership will not be moved on aid to Israel, of course. But beginning the discussion now—which AOC has just begun—can help create leadership more disposed to putting material pressure on Israel. However, any fight to cut or end aid to Israel will provoke a response not just from advocacy groups like AIPAC and Christians United for Israel (CUFI) but from some of the most powerful industries in this country. Their arguments will be the tried-and-true ones: that any attack on aid to Israel could lead to the annihilation of the Jewish state and will also cost jobs in vulnerable areas of the United States that depend on the defense industries. These obstacles mean that any challenge to U.S. aid to Israel requires a much larger political lift. But that doesn’t necessarily argue against a campaign that shines a spotlight on that aid. There are exploitable areas, such as regulations in U.S. law governing arms exports and human rights violations. Although it is not clear how often Israel uses U.S.-made weapons in the occupied territories, advocates have made accusations of their use, with supporting evidence, from time to time. Sustained efforts at investigating these violations will not change Israeli practices, but the additional publicity would have obvious benefits for advocates of Palestinian rights. A campaign to reduce or eliminate U.S. aid to Israel, or narrower campaigns to tie that aid to specific policy demands, could do a lot to promote dialogue about U.S. policy toward Israel, even if it doesn’t achieve its broader objectives. If advocates undertake campaigns with that understanding, they may find the collateral benefits worth the effort.

Congress has to act for aid to Israel to be cut

Mitchell Plitnick, April 22, 2019, https://lobelog.com/u-s-aid-to-israel-what-you-need-to-know/, U.S. Aid To Israel: What You Need To Know

That’s just one obstacle to cutting U.S. aid to Israel. The MOU is a sort of promise between the White House and Israel, but it is Congress that must authorize the aid in every annual budget. That is where the various lobbying forces are most powerful. But even if advocates could get Congress to change its view on aid to Israel—a quixotic task—they face certain legal challenges.

Congress is bound by law to ensure that Israel maintains its “qualitative military edge” (QME) in the region. This was defined, in the Naval Vessel Transfer Act of 2008, as “the ability to counter and defeat any credible conventional military threat from any individual state or possible coalition of states or from non-state actors, while sustaining minimal damage and casualties.” The same act requires the president to judge any arms sales to other countries in the region, whether they are in conflict with Israel or not, in light of maintaining Israel’s QME. All of this was reinforced by legislation passed in 2012 and 2014. Before even getting to the point of a congressional challenge to the MOU’s commitment of annual aid to Israel, Congress would first need to revise or reverse these laws.

US exports to Europe force France to export to the Middle East

France24 Live, 4-20, 19, https://www.france24.com/en/20190420-france-arms-exports-yemen-saudi-uae-khashoggi-disclose France under pressure to come clean over Yemen arms exports

Preserving sovereignty through an independent arms industry has long been a cornerstone of French defence policy, an imperative that often overrides ethical concerns about the way French arms are used.

“The trouble is France’s army is too small for the amount of weapons produced,” said Élie Tenenbaum, a research fellow at the IFRI Security Studies Centre in Paris, in an interview with FRANCE 24. “To remain profitable, French firms have to focus on exports. They would rather export to Europe, but the market is dominated by US competitors. So they have to turn to the Middle-East.”

France undermining the ATT

France24 Live, 4-20, 19, https://www.france24.com/en/20190420-france-arms-exports-yemen-saudi-uae-khashoggi-disclose France under pressure to come clean over Yemen arms exports

France’s lucrative arms exports to the Gulf came under renewed scrutiny this week following the release of a classified report showing that the Saudi-led coalition in Yemen has made much wider use of French arms than officials in Paris acknowledge. ADVERTISING On October 3, 2018, a day after journalist Jamal Khashoggi entered the Saudi consulate in Istanbul, never to be seen again, French President Emmanuel Macron received a highly classified intelligence note, detailing the position of French-made arms used by the Saudi-led coalition fighting a bloody war in Yemen. The 15-page note by France’s DRM military intelligence agency showed that French arms including tanks and laser-guided missile systems sold to Saudi Arabia and the United Arab Emirates are being used in the conflict, and that swathes of Yemen’s civilian population live within their range. Though intended only for Macron, his prime minister, and the foreign and defence ministers, the document was eventually leaked to the independent investigative website Disclose, which published it in full on Monday, casting unwanted attention on France’s involvement in the war devastating Yemen. ADVERTISING The report prompted renewed criticism from opposition politicians and NGOs, with the head of Human Rights Watch in France, Bénédicte Jeannerod, stating that “the government can no longer deny the risk of complicity in war crimes”. Macron’s government has repeatedly claimed that French arms sold to Saudi Arabia and its allies are used solely for defensive purposes, a stance that has become increasingly hard to maintain as the death toll from the devastating conflict continues to rise. “To my knowledge, French weapons are not being used in an offensive capacity in the war in Yemen,” Defence Minister Florence Parly told Radio Classique on Thursday, sticking to the official line. “I do not have any evidence that would lead me to believe that French arms are behind civilian victims in Yemen,” she added. But according to Sébastien Nadot, a French lawmaker and former member of Macron’s LREM party, the classified document proves that Parly and her colleagues in government have been deliberately concealing the facts. “Ministers are in possession of a document that shows they have been lying for months – and the source is our own intelligence service!” Nadot, who caused a kerfuffle in parliament last month by displaying a “France kills in Yemen” banner, told FRANCE 24. “How can we speak of weapons of defence when we know French-made tanks are deployed 800 kilometres [into Yemeni territory]?” asked the now-independent lawmaker, whose calls for a parliamentary investigation into the use of French arms in Yemen’s conflict have been dismissed. ‘We don’t sell weapons like they’re baguettes’ Pieter Wezeman, a Senior Researcher at Stockholm-based SIPRI, an independent Swedish institute dedicated to research into conflict, armaments, arms control and disarmament, said the French intelligence note confirms earlier findings about the extensive use of Western weapons in war in Yemen. “The simple fact is that if you sell weapons to Saudi Arabia or the United Arab Emirates, there is a very significant chance they have been, or will be, used in Yemen,” Wezeman told FRANCE 24. “What is interesting is that French intelligence were given the assignment to compile this document,” he added, referring to the classified report. “It suggests there is enough concern within government circles for them to want to know more about what is going on in Yemen.” Pitting a Saudi-led coalition against Iranian-backed Houthi militias, the four-year conflict in Yemen has shattered the country’s economy and created the world’s worst humanitarian crisis, according to the United Nations, whose investigators say both sides may have committed war crimes. More than 10,000 civilians have been killed during the conflict and some 10 million people have been driven to the brink of famine. The scale of the bloodshed, coupled with the outrage prompted by Khashoggi’s brutal murder, has prompted growing criticism of the Western powers – chief among them the US, Britain and France – that arm the Saudi coalition. France is the world’s third-biggest arms exporter, its sales having increased fourfold under Macron’s predecessor, François Hollande. Between 2008 and 2017, Saudi Arabia and the UAE were, respectively, its second and sixth biggest export markets, according to the French defence ministry. But in an interview with France Inter radio station in January, Parly described French exports to Saudi Arabia as “relatively modest” and subject to tight restrictions, adding: “We don’t sell weapons like they’re baguettes.” ‘Not on the front line’ The DRM’s intelligence document states that Caesar cannons, manufactured by French company Nexter and deployed along the Saudi-Yemeni frontier, conduct defensive shelling of Houthi forces as well as back-up “loyalist troops and Saudi armed forces in their progression into Yemeni territory”. Cougar transport helicopters and the A330 MRTT refuelling plane have also seen action, and two French-built ships are serving in the blockade of Yemeni ports that has led to food and medical shortages, the document added, casting a pall over Parly’s assertion that “it is a priority for France that humanitarian aid gets through”. A second, six-page DRM intelligence report distributed more widely, according to Disclose, showed Leclerc tanks were deployed in defensive positions in a handful of bases in south-eastern Yemen. Disclose claimed its study of satellite images, video and photographs taken by civilians showed some of the French tanks bought by the UAE had taken part in coalition offensives, including the campaign for control of the Houthi-held port of Hodeidah. The six-page report also said Emirati Mirage fighter jets equipped with a laser-guided system made by French multinational Thales, known as Damocles, were possibly being used in Yemen. In response to questions sent by Disclose, the French prime minister’s office neither confirmed nor denied the report, nor questioned the authenticity of the leaked documents. It said France adopted rigorous safeguards when issuing export licences and supported UN efforts to broker peace in Yemen. “To our knowledge, French arms possessed by coalition forces are placed for the most part in defensive positions, outside of Yemeni territory or under coalition control, but not on the front line,” Prime Minister Édouard Philippe’s office wrote, adding that France was not aware of Yemeni civilians being killed by French arms. While the defence ministry, which oversees the DRM, has not commented on the intelligence report, the foreign ministry stressed in a written response to French media that “all arms sales comply with [France’s] international commitments”. Those commitments include abiding by the terms of the UN Arms Trade Treaty (ATT), which regulates the international trade of conventional weapons and bans the sale of weapons that fuel human rights violations or war crimes, and which came into force in 2014. Critics of the French government say it is in clear breach of its obligations under the ATT, but Wezeman says such breaches are very hard to prove. “The ATT doesn’t require signatories to stop exporting weapons to countries that go to war. It requires only that governments carry out assessments that their weapons don’t contribute to war crimes,” Wezeman explained. “In this case, France has presumably concluded that there is not enough reason to stop its exports.” He added: “Even if you did prove [French] weapons were used [against civilians], you would still have to prove it was intentional or the result of gross negligence. International law says you have to be very careful, but it is very hard to prove one hasn’t been careful.” Franco-German spat The sensitive issue has put France at odds with its key partner Germany, which imposed an embargo on arms exports to Riyadh in the wake of Khashoggi’s murder. The move sparked stinging criticism from Paris and London, with Macron accusing the German government of “demagoguery”. In an unusually strong-worded op-ed published on the website of Germany’s Federal Academy for Security Studies, Anne-Marie Descôtes, the French ambassador to Berlin, warned that the “unpredictability of German policy on arms export controls” carried “major consequences for [Franco-German] defence cooperation and the construction of European sovereignty”. Preserving sovereignty through an independent arms industry has long been a cornerstone of French defence policy, an imperative that often overrides ethical concerns about the way French arms are used. “The trouble is France’s army is too small for the amount of weapons produced,” said Élie Tenenbaum, a research fellow at the IFRI Security Studies Centre in Paris, in an interview with FRANCE 24. “To remain profitable, French firms have to focus on exports. They would rather export to Europe, but the market is dominated by US competitors. So they have to turn to the Middle-East.” Some critics of Germany’s decision to halt exports have argued that Berlin had less to lose than France, but SIPRI’s Wezeman rejects the argument. “Germany would have profited considerably from arms deals with Saudi Arabia, which was very interested in German arms, particularly German tanks. The stakes were just as important,” he said, suggesting Berlin’s policy change reflected a cultural difference. “In Germany and in several Nordic countries there is traditionally much stronger political pressure to be more careful with arms exports,” Wezeman added. French lawmaker Nadot believes that instead of admonishing the German government, France would be better advised to follow the example set by its European partner, particularly at a time when US President Donald Trump’s administration is undermining the rules-based international order. What’s more, Nadot notes that France is sapping the spirit of the ATT treaty it once championed. When the treaty came into force in 2014, “France was rightly proud of the fact that 60 countries had ratified it, with more to follow,” he said. “And yet, we are now trampling on its principles.”

US reducing arms export restrictions and pushing to expand exports

Law 360, 4-19, 19, https://www.law360.com/aerospace/articles/1151392/state-dept-eases-gov-t-arms-export-restrictions?copied=1

Law360 (April 19, 2019, 7:56 PM EDT) — The U.S. Department of State expanded an exemption from arms export licensing requirements for federal agencies in a final rule published Friday, allowing the exemption to cover not only temporary exports but also permanent exports and those made by third parties on behalf of the government. Under the International Traffic in Arms Regulations, or ITAR, importers and exporters of arms and “defense services” are, with limited exceptions, required to get a license from the State Department’s Directorate of Defense Trade Controls, or DDTC, before making any arms transfers. Federal agencies and their employees — acting as part of their official duties — were previously exempt from those licensing requirements if their arms transfers involved a temporary import or export in circumstances such as when the government intends to use an item itself, or as part of an international assistance, security cooperation, or sales or loan program. The new final rule, formally published in the Federal Register on Friday and effective immediately, expands that exemption to also cover permanent exports and reexports — where a foreign country transfers an arms export to another foreign country — as well as covering transfers made by third parties acting for the government, such as federal contractors operating in a government-controlled facility. There is also scope for the exemption to apply to other activities of contractors, if requested by a federal agency and approved by the deputy assistant secretary of state for defense trade controls, according to the rule. However, “authorization to export does not absolve parties of the requirement to comply with any applicable U.S. Government processes, procedures, or practices, including the need for exports of items on the [Missile Technology Control Regime] Annex to receive the case-by-case review called for by the MTCR Guidelines,” the State Department said. That also applies to arms transfers that are subject to other legal restraints, such as a U.S. or United Nations Security Council arms embargo, the agency claimed. Additionally, any change to the intended end-user of an otherwise exempt export would require DDTC approval, and — as with the existing licensing exemption — the expanded exemption does not apply when the government is acting as an agent of a private party, according to the final rule. Addressing comments it had received on its earlier proposed version of the rule, the State Department said it made minor tweaks in response to that feedback, as well as confirming that the new rule still allows for exports of defense technical data, despite removing a specific reference to technical data from its previous rule. Technical data is a type of “defense article” and is therefore covered under the broader general clause covering exports of defense articles, the agency claimed, saying the previous reference to technical data was “redundant and confusing.” The new rule comes as part of a broader effort under the Trump administration to ease ITAR restrictions, including a pair of complementary rules proposed in May 2018, intended to make it easier to export small arms that are not considered to give the U.S. a military advantage or otherwise deemed “inherently military.The administration has also pushed to top the foreign military sales record achieved under the Obama administration, where there were about $300 billion in foreign arms deals across those eight years — the highest for any administration going back to at least World War II.

 

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