{"id":42156,"date":"2015-03-24T17:35:52","date_gmt":"2015-03-24T17:35:52","guid":{"rendered":"https:\/\/one.sightlinemg.com\/defensenews\/uncategorized\/2015\/03\/24\/in-global-exports-smaller-nations-seek-edge\/"},"modified":"2026-08-07T23:20:54","modified_gmt":"2026-08-07T23:20:54","slug":"in-global-exports-smaller-nations-seek-edge","status":"publish","type":"post","link":"https:\/\/one.sightlinemg.com\/defensenews\/industry\/2015\/03\/24\/in-global-exports-smaller-nations-seek-edge\/","title":{"rendered":"In Global Exports, Smaller Nations Seek Edge"},"content":{"rendered":"\n

WASHINGTON \u2014 Widespread growth in global arms exports may point to heightened competition for sales in the future as more countries develop increasingly sophisticated defense industries, analysts said.<\/p>\n\n\n\n

The US and Russia remain the dominant sellers, accounting for more than half of global sales between 2010 and 2014, according to figures released last week by the Stockholm International Peace Research Institute (SIPRI). But other countries are really <\/span>driving the overall growth in arms exports, which grew by 16 percent globally compared with the period between 2005 and 2009, analysts said.<\/p>\n\n\n\n

“There is competition coming from other parts of the world now. China is the most visible [example], but increasingly you have capabilities being developed in other parts of the world,” said Jon Barney, managing director at Avascent, a strategy and management consulting firm. “<\/span>It’s a rising tide, and it’s game-changing across the sector.”<\/p>\n\n\n\n

\"\"
Local and military rescuers continue their efforts searching for a Marine in waters off Tumon on Monday, Aug. 10. The unidentified man was reported missing on Aug. 9, after being swept out to sea while swimming, according to a U.S. Marine Corps release. <\/figcaption><\/figure>\n\n\n\n

Photo Credit: John Bretschneider<\/span><\/p>\n\n\n\n

After the US, Russia and China, European countries \u2014 Germany, France, the UK, Spain, Italy and Ukraine \u2014 and Israel round out the top 10 ten <\/span>arms exporters. China experienced the largest growth in exports, up 143 percent from the previous period, while Germany’s exports dropped by 43 percent, dropping it out of third place.<\/p>\n\n\n\n

Traditionally, China has produced very low-cost, low-tech systems, often copied from Russian models, said Philip Finnegan, director of corporate analysis at Teal Group. At a time when US defense spending has been relatively flat, China’s defense budget has grown, and the investment is beginning to pay dividends, he said.<\/p>\n\n\n\n

“They’re coming up, they’re really moving up the value chain and sophistication level,” Finnegan said.<\/p>\n\n\n\n

\"\"
Local and military rescuers continue their efforts searching for a Marine in waters off Tumon on Monday, Aug. 10. The unidentified man was reported missing on Aug. 9, after being swept out to sea while swimming, according to a U.S. Marine Corps release. <\/figcaption><\/figure>\n\n\n\n

Photo Credit: John Bretschneider<\/span><\/p>\n\n\n\n

Closing the technology gap with the US to produce higher quality products is one way that emerging producers are making themselves more attractive to buyers. Sellers in the same region may be more convenient, and buying from countries besides the US and Russia often comes without the geopolitical and ideological strings attached.<\/p>\n\n\n\n

And even traditional alliances may become less influential in the future, said Remy Nathan, vice president of international affairs at the Aerospace Industries Association.<\/p>\n\n\n\n

“There are certain things that are just unlikely to occur,” such as the UK buying a Chinese military system, Nathan said. “But having said that, I’m not taking it for granted that traditional customers of US systems are going to remain those customers.”<\/p>\n\n\n\n

The market \u2014 the countries that need things, their ability to afford them, their desire to buy them \u2014 is changing, Nathan said. A program that is 80 percent effective but costs a fraction of one that is 90 or 95 percent effective will often win out, he said.<\/p>\n\n\n\n

Countries not in the top 10 ten <\/span>are building up their programs by developing niche products, said <\/span>Finnegan said. For example, Turkey has made strides with its Anka UAV, a medium-altitude\/long-endurance vehicle under development by Turkish Aerospace Industries. The KC-390, a twin-engine cargo plane manufactured by Brazil’s Embraer, may someday provide competition for American made C-130s.<\/p>\n\n\n\n

“There’s an ambition to develop broad industry, but it tends to be a niche approach,” he said.<\/p>\n\n\n\n

Analysts said that while the US, Russia and China are likely to remain the top three exporters, European countries are the most vulnerable to lose their market share to the emerging upstarts.<\/p>\n\n\n\n

Byron Callan, a defense market analyst with Capital Alpha Partners, said that restrained defense budgets for European producers, including the UK, Germany, Spain and Italy, have hurt their prospects.<\/p>\n\n\n\n

“They’ve kind of starved their industry of research and development, and it’s not clear how commercially competitive some of their next generation stuff is,” he said. “They show up on this list right now, but if they’re people who get bumped, it’s going to be continental European countries.”<\/p>\n\n\n\n

But it’s hard to look back at sales figures and see what disruptions and perceptions of political instability will affect the market in the future, Callan said.<\/p>\n\n\n\n

“Some of the most disruptive things that are happening aren’t coming from anybody on that list,” he said. Non-state actors such as like <\/span>Boko Haram and the Islamic State ISIS <\/span>can cause mayhem with light infantry weapons.<\/p>\n\n\n\n

“The instability isn’t coming from main battle tanks and advanced aircrafts<\/span>, but groups that can get their hands on large stocks of weapons and ammunition,” Callan said.<\/p>\n\n\n\n

Email: aclevenger@defensenews.com<\/a><\/p>\n\n\n\n

Twitter: @<\/a>andclev<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

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