{"id":52112,"date":"2020-08-04T11:00:00","date_gmt":"2020-08-04T11:00:00","guid":{"rendered":"https:\/\/one.sightlinemg.com\/defensenews\/uncategorized\/2020\/08\/04\/to-keep-weapon-sales-in-place-us-offers-new-options-for-payment\/"},"modified":"2026-08-07T23:56:25","modified_gmt":"2026-08-07T23:56:25","slug":"to-keep-weapon-sales-in-place-us-offers-new-options-for-payment","status":"publish","type":"post","link":"https:\/\/one.sightlinemg.com\/defensenews\/pentagon\/2020\/08\/04\/to-keep-weapon-sales-in-place-us-offers-new-options-for-payment\/","title":{"rendered":"To keep weapon sales in place, US offers new options for payment"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">WASHINGTON \u2014 The United States is developing new options for arms customers as a way to ensure allies and partners <a href=\"https:\/\/www.defensenews.com\/congress\/2020\/06\/15\/will-us-foreign-military-sales-catch-the-coronavirus\/\" target=_blank>don\u2019t drop<\/a> planned procurements as the world economy remains in shock from the impacts of COVID 19.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Among the options, according to outgoing Defense Security Cooperation Agency head <a href=\"https:\/\/www.defensenews.com\/outlook\/2019\/12\/02\/defense-security-cooperation-agency-chief-on-the-value-of-partnerships\/\" target=_blank>Lt. Gen. Charles Hooper<\/a>, are allowing foreign countries to finance arms procurement through U.S. bank loans and altering existing payment schedules to stretch the costs over time.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cThe bottom line here is, we are willing to work with our allies and partners, when they <a href=\"https:\/\/www.defensenews.com\/opinion\/commentary\/2020\/05\/26\/will-defense-budgets-remain-sticky-after-the-covid-19-pandemic\/\" target=_blank>raise the challenges<\/a> that they have, to find ways for them to continue to buy American and to ensure that they can pay for the equipment along a payment schedule that reflects their own economic conditions,\u201d Hooper said.<\/p>\n\n\n\t<aside class=\"smg-interstitial-link wp-block-smg-interstitial-link\">\n\t\t<a href=\"https:\/\/one.sightlinemg.com\/defensenews\/interviews\/2020\/08\/03\/us-weapon-sales-boss-talks-china-arms-exports-and-his-agencys-future\/\" class=\"smg-interstitial-link__inner\">\n\t\t\t\t\t\t\t<div class=\"smg-interstitial-link__media\">\n\t\t\t\t\t<img loading=\"lazy\" decoding=\"async\" width=\"300\" height=\"200\" src=\"https:\/\/one.sightlinemg.com\/wp-content\/uploads\/2026\/08\/4561393.jpg.jpg?w=300\" class=\"smg-interstitial-link__image wp-post-image\" alt=\"\" \/>\t\t\t\t<\/div>\n\t\t\t\t\t\t<div class=\"smg-interstitial-link__content\">\n\t\t\t\t<span class=\"smg-interstitial-link__kicker\">Related<\/span>\n\t\t\t\t<h3 class=\"smg-interstitial-link__title\">US weapon sales boss talks China, arms exports and his agency\u2019s future<\/h3>\n\t\t\t\t\t\t\t\t\t<p class=\"smg-interstitial-link__excerpt\">In an exclusive exit interview, Lt. Gen. Charles Hooper discusses the highlights of his years running the Defense Security Cooperation Agency.<\/p>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/a>\n\t<\/aside>\n\t\n\n\n<p class=\"wp-block-paragraph\">During an exclusive exit interview with Defense News, Hooper declined to say which countries have already approached his agency about economic impact from the disease, but said that there are \u201ccertainly\u201d customer nations that have reached out.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cThere are partners that, we\u2019re already seeing that they are having challenges. So we\u2019re standing ready to work with them. As soon as we can gain an appreciation and the understanding of the challenges, we can find ways to help them,\u201d Hooper said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Hooper talked with Defense News two weeks before his Aug. 3 retirement. He is succeeded by Heidi Grant, the head of the Defense Security Technology Administration, a move that marks the <a href=\"https:\/\/www.defensenews.com\/pentagon\/2020\/07\/18\/heidi-grant-takes-over-defense-security-cooperation-agency\/\">first time a civilian<\/a> has led the office since a previous agency was recognized into the current DSCA structure in 1998. The general expressed no concerns over that move, in large part, he said, because of Grant, a fixture in the international security cooperation world.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Grant will have to hit the ground running, given the potential impact from COVID on the world economies. The good news, Hooper said, is that by March, DSCA had concluded that the global economy would be hurt by the disease and set up an interagency working group, called the Operations Planning Group, to study program-level impacts from global trends and develop solutions.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The first step Hooper\u2019s team took was to revise the collection process of foreign payment in order to make them \u201ca bit more flexible, to accommodate those partners that may be having some economic difficulties or may have reprioritized their budgets towards for example, economic recovery and away from defense.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Those options include delaying payments on planned procurements to future years, creating new payment plans for ongoing procurement efforts, and returning funds currently on deposit with the United States to the customer nations as well as new financing strategies.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cOne of the things we did is we are allowing our partners to draw on standby letters of credit from foreign banks operating in the United States, according to U.S. banking rules,\u201d Hooper explained. \u201cThat offers a nation an opportunity to draw, for example, in that case, a standby letter of credit on one of their banks that operates in the United States, under United States banking rules, which ensures that there\u2019s no fiduciary risk to the United States.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">DSCA officials had been considering adding such an option for some time, but the economic downturn pushed the agency to start offering it for customer nations, Hooper added. Lucie B\u00e9raud-Sudreau, director of the Arms and Military Expenditure Programme at the Stockholm International Peace Research Institute, said that option sounds different from funding plans that have existed for some time in Europe, where specific entities in countries are responsible for guaranteeing arms-recipient states\u2019 loans thanks to the state treasury.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cThere are a number of economic factors globally, that we anticipate will likely have an impact on country\u2019s abilities to move forward,\u201d Hooper said. \u201cObviously, energy prices are lower, and those countries all over the world that specialize in energy are going to see a fall in revenue. We see countries that, as a result of the pandemic, are having to shift funds from their defense budgets to more domestic missions like economic recovery and other things.\u201d<\/p>\n\n\n\t<aside class=\"smg-interstitial-link wp-block-smg-interstitial-link\">\n\t\t<a href=\"https:\/\/one.sightlinemg.com\/defensenews\/industry\/2020\/06\/17\/indias-defense-industry-is-set-to-lose-3-billion-from-nationwide-lockdown\/\" class=\"smg-interstitial-link__inner\">\n\t\t\t\t\t\t\t<div class=\"smg-interstitial-link__media\">\n\t\t\t\t\t<img loading=\"lazy\" decoding=\"async\" width=\"300\" height=\"177\" src=\"https:\/\/one.sightlinemg.com\/wp-content\/uploads\/2026\/08\/Mumbai-.jpg.jpg?w=300\" class=\"smg-interstitial-link__image wp-post-image\" alt=\"\" \/>\t\t\t\t<\/div>\n\t\t\t\t\t\t<div class=\"smg-interstitial-link__content\">\n\t\t\t\t<span class=\"smg-interstitial-link__kicker\">Related<\/span>\n\t\t\t\t<h3 class=\"smg-interstitial-link__title\">India\u2019s defense industry is set to lose $3 billion from nationwide lockdown<\/h3>\n\t\t\t\t\t\t\t\t\t<p class=\"smg-interstitial-link__excerpt\">Those affected include more than 100 large defense firms and some 4,000 small and medium aerospace and defense businesses.<\/p>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/a>\n\t<\/aside>\n\t\n\n\n<p class=\"wp-block-paragraph\">In addition to oil-reliant nations in the Middle East, B\u00e9raud-Sudreau said to watch the Pacific region, where \u201cmany countries have already decided to cut their military spending for this year, and planning decreases for 2021.\u201d Indonesia, Thailand, South Korea, and the Philippines are among the nations that have already announced plans to cut defense spending, while Singapore is seeing delays in weapon deliveries <a href=\"https:\/\/www.defensenews.com\/coronavirus\/2020\/06\/29\/sub-helo-deliveries-to-singapore-delayed-by-pandemic\/\" target=_blank>due to supply chain issues<\/a>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cIf there are limited orders in 2020-2021, there will be repercussions later on, as these companies work on long-term projects. Hence the pressure, on both sides of the Atlantic, for the defense sector to be part of economic recovery packages and high levels of military expenditure,\u201d she said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Over the course of his time at DSCA, Hooper oversaw almost 18,300 Foreign Military Sales actions, including 5,800 new agreements and various amendments and modifications to existing agreements, according to agency figures. He reduced <a href=\"https:\/\/www.defensenews.com\/digital-show-dailies\/ausa\/2019\/10\/16\/3-ways-the-pentagon-wants-to-make-buying-american-weapons-easier\/\" target=_blank>three different surcharges<\/a> on customers, saving customers millions of dollars as well. Also, timelines shrunk, with DSCA offering 50 percent of all new FMS cases that flow through the process to partner nations in 49 days or less by Hooper\u2019s exit.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">And while Hooper did not want to preview what weapon sales totals for fiscal 2020 will be, he did say that the United States remains \u201con a very positive trajectory\u2026 We remain the global partner of choice. And I\u2019m very optimistic that we\u2019re going to continue to see positive trends in our foreign military sales this year and in the years to come.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"<p>U.S. weapons customers may get a financial break in the wake of COVID 19&#8217;s economic impact, according to Lt. Gen. Charles Hooper of the Defense Security Cooperation Agency.<\/p>\n","protected":false},"author":7,"featured_media":77708,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_yoast_wpseo_meta-robots-noindex":"","_yoast_wpseo_meta-robots-nofollow":"","_yoast_wpseo_canonical":"","_acf":"","_yoast_wpseo_primary_category":19,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","_smg_distribution_targets":[]},"categories":[160,11,12,36,19],"tags":[],"coauthors":[3378],"class_list":["post-52112","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-daily-news-roundup","category-global","category-industry","category-newsletters","category-pentagon"],"acf":{"subheadline":"","legacy_arc_id":"CXR7JW5PTVGCZKK5GGKRNZT3PI","arc_canonical_url":"\/pentagon\/2020\/08\/04\/to-keep-weapon-sales-in-place-us-offers-new-options-for-payment\/","remove_feature_photo":false,"is_sponsored":false,"subtype":"","redirect_url":"","disable_inline_ads":false,"native_logo_pretext":"Presented By:"},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.0 (Yoast SEO v28.1) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>To keep weapon sales in place, US offers new options for payment - Defense News<\/title>\n<meta name=\"description\" content=\"U.S. weapons customers may get a financial break in the wake of COVID 19&#039;s economic impact, according to Lt. 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