Washington [US], December 2: The world's largest arms manufacturers are set to see record sales in 2024 thanks to conflicts and tensions, according to a recently released report by the influential SIPRI think tank.
The Stockholm International Peace Research Institute (SIPRI, Sweden) released a report on December 1 showing that the revenue of the world's 100 largest defense contractors in 2024 will reach a record high of 679 billion USD, an increase of 5.9% compared to 2023, according to AFP.
Conflict and tension
The report pointed to demand from conflicts in Ukraine and Gaza, and regional and global tensions, as driving the increase. Jade Guiberteau Ricard, a researcher at SIPRI's arms production and military expenditure programme, said the main driver of the growth was Europe, as countries provided weapons to Ukraine and sought to expand and modernise their militaries amid concerns about Russia.
There are 26 European companies in the top 100, with a total revenue of $151 billion (up 13%). Czech contractor Czechoslovak Group had the highest growth rate in the top 100, with a revenue of $3.6 billion (up 193%). The company benefited from the Czech government's initiative to buy artillery shells to support Ukraine.
Russia has two arms manufacturers in the top 100: Rostec and United Shipbuilding Corporation (USC). Despite sanctions and shortages of components, the two companies achieved a revenue of $31.2 billion (up 23%). Revenues of Russian contractors increased thanks to increased domestic demand, which offset the decline in exports.
The colorful painting
In the top 100, there are 39 US companies with a total revenue of 334 billion USD (up 3.8%), accounting for nearly half of the world. According to SIPRI, 5/6 of the largest revenue arms companies are US: Lockheed Martin, RTX, Northrop Grumman, General Dynamics and Boeing. The remaining company is BAE Systems (UK), ranked 4th. However, budget overruns and stagnation have affected many key US weapons programs such as F-35 fighter jets and Columbia-class nuclear submarines.
European contractors are also struggling to source materials to meet rising demand for weapons . Before Russia launched its military campaign in Ukraine in 2022, companies such as Airbus and Safran (France) imported half of their titanium supplies from Russia and now have to find new suppliers. China's export restrictions on important minerals have also forced contractors Thales (France) and Rheinmetall (Germany) to restructure their supply chains and warn of rising costs. Meanwhile, Russian companies are struggling to find skilled workers to maintain productivity for war.
Only companies in Asia and Oceania saw their revenues decline, largely due to China's slowdown. The 23 companies in the region reported a combined revenue of $130 billion last year, down 1.2 percent. Eight Chinese military contractors saw their revenues fall 10 percent amid a series of corruption allegations in procurement that led to the delay or cancellation of several major contracts.
In contrast to China , Japanese, South Korean and Middle Eastern contractors all saw their revenues increase in 2024. The protests over Israel's actions in Gaza are believed to have had little impact on interest in the weapons it produces. The three Israeli arms companies in the top 100 are expected to generate $16.2 billion in 2024, up 16% and accounting for more than half of the Middle East. The parties involved have not commented on the SIPRI report.
Source: Thanh Nieu Newspaper
