# Conventional Arms Transfers to Developing Nations, 1999-2006

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URL: https://www.frixlaw.com/law-library/documents/crs%3ARL34187

## Record

- **Collection:** Congressional research report
- **Document type:** CRS Report
- **Published:** September 26, 2007
- **Citation:** RL34187

## Text

Order Code RL34187

Conventional Arms Transfers to
Developing Nations, 1999-2006

September 26, 2007

Richard F. Grimmett
Specialist in National Defense
Foreign Affairs, Defense, and Trade Division

Conventional Arms Transfers to Developing Nations,
1999-2006
Summary
This report is prepared annually to provide Congress with official, unclassified,
quantitative data on conventional arms transfers to developing nations by the United
States and foreign countries for the preceding eight calendar years for use in its
policy oversight functions. All agreement and delivery data in this report for the
United States are government-to-government Foreign Military Sales transactions.
Some general data are provided on worldwide conventional arms transfers by all
suppliers, but the principal focus is the level of arms transfers by major weapons
suppliers to nations in the developing world.
Developing nations continue to be the primary focus of foreign arms sales
activity by weapons suppliers. During the years 1999-2006, the value of arms
transfer agreements with developing nations comprised 66.4% of all such agreements
worldwide. More recently, arms transfer agreements with developing nations
constituted 65.7% of all such agreements globally from 2003-2006, and 71.5% of
these agreements in 2006.
The value of all arms transfer agreements with developing nations in 2006 was
nearly $28.8 billion. This was a decrease from $31.8 billion in 2005. In 2006, the
value of all arms deliveries to developing nations was $19.9 billion, the lowest total
in these deliveries values for the entire 1999-2006 period (in constant 2006 dollars).
Recently, from 2003-2006, the United States and Russia have dominated the
arms market in the developing world, with the United States ranking first for 3 out
of 4 years in the value of arms transfer agreements, with Russia ranking second for
3 out of these same four years. From 2003-2006, the United States made $34.1
billion in arms transfer agreements with developing nations, in constant 2006 dollars,
32.4% of all such agreements. Russia, the second leading supplier during this period,
made $25.8 billion in arms transfer agreements, or 24.5%. Collectively, the United
States and Russia made 56.9% of all arms transfer agreements with developing
nations during this four year period.
In 2006, the United States ranked first in arms transfer agreements with
developing nations with $10.3 billion or 35.8% of these agreements. Russia was
second with $8.1 billion or 28.1% of such agreements. The United Kingdom was
third with $3.1 billion or 10.8%. In 2006, the United States ranked first in the value
of arms deliveries to developing nations at nearly $8 billion, or 40.2% of all such
deliveries. Russia ranked second at $5.5 billion or 27.7% of such deliveries. The
United Kingdom ranked third at $3.3 billion or 16.6% of such deliveries.
In 2006, Pakistan ranked first in the value of arms transfer agreements among
all developing nations weapons purchasers, concluding $5.1 billion in such
agreements. India ranked second with $3.5 billion in such agreements. Saudi
Arabia ranked third with $3.2 billion.

Contents
Introduction and Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Major Findings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
General Trends in Arms Transfers Worldwide . . . . . . . . . . . . . . . . . . . . . . . 4
General Trends in Arms Transfers to Developing Nations . . . . . . . . . . . . . . 6
United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Russia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Major West European Suppliers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Regional Arms Transfer Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Near East . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Leading Developing Nations Arms Purchasers . . . . . . . . . . . . . . . . . . . . . . 17
Weapons Types Recently Delivered to Near East Nations . . . . . . . . . . . . . 18
United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Russia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Major West European Suppliers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
All Other European Suppliers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
All Other Suppliers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Summary of Data Trends, 1999-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Total Developing Nations Arms Transfer Agreement Values . . . . . . . . . . . 21
Regional Arms Transfer Agreements, 1999-2006 . . . . . . . . . . . . . . . . . . . . 27
Near East . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Latin America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Africa . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Arms Transfer Agreements With Developing Nations, 1999-2006:
Leading Suppliers Compared . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Arms Transfer Agreements With Developing Nations in 2006:
Leading Suppliers Compared . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Arms Transfer Agreements With Near East 1999-2006:
Suppliers and Recipients . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Arms Transfers to Developing Nations, 1999-2006:
Agreements With Leading Recipients . . . . . . . . . . . . . . . . . . . . . . . . . 35
Arms Transfers to Developing Nations in 2006:
Agreements With Leading Recipients . . . . . . . . . . . . . . . . . . . . . . . . . 36
Developing Nations Arms Delivery Values . . . . . . . . . . . . . . . . . . . . . . . . . 36
Regional Arms Delivery Values, 1999-2006 . . . . . . . . . . . . . . . . . . . . . . . . 41
Near East . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Latin America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Africa . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Arms Deliveries to Developing Nations, 1999-2006:
Leading Suppliers Compared . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

Arms Deliveries With Developing Nations in 2006:
Leading Suppliers Compared . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Arms Deliveries to Near East, 1999-2006: Suppliers and Recipients . . . . . 44
Arms Deliveries to Developing Nations, 1999-2006:
The Leading Recipients . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Arms Transfers to Developing Nations in 2006:
Agreements With Leading Recipients . . . . . . . . . . . . . . . . . . . . . . . . . 46
Selected Weapons Deliveries toDeveloping Nations, 1999-2006 . . . . . . . . . . . . 69
Regional Weapons Deliveries Summary, 2003-2006 . . . . . . . . . . . . . . . . . 69
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Near East . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Latin America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Africa . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Worldwide Arms Transfer Agreements and Deliveries Values, 1999-2006 . . . . 77
Total Worldwide Arms Transfer Agreements Values, 1999-2006 . . . . . . . 77
Total Worldwide Delivery Values 1999-2006 . . . . . . . . . . . . . . . . . . . . . . . 78
Description of Items Counted in Weapons Categories, 1999-2006 . . . . . . . . . . . 90
Regions Identified in Arms Transfer Tables and Charts . . . . . . . . . . . . . . . . . . . 91

List of Tables
Figure 1. Worldwide Arms Transfer Agreements, 1999-2006 and
Suppliers’ Share with Developing World
(in millions of constant 2006 U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . 26
Figure 2. Worldwide Arms Deliveries, 1999-2006 and Suppliers’
Share with Developing World
(in millions of constant 2006 U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . 40
Table 1. Arms Transfer Agreements With Developing Nations, by Supplier,
1999-2006 (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . 47
Table 1A. Arms Transfer Agreements with Developing Nations, by Supplier,
1999-2006 (in millions of constant 2006 U.S. dollars) . . . . . . . . . . . . . . . . 48
Table 1B. Arms Transfer Agreements with Developing Nations, by Supplier,
1999-2006(expressed as a percent of total, by year) . . . . . . . . . . . . . . . . . . 49
Table 1C. Regional Arms Transfer Agreements, by Supplier, 1999-2006
(in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Table 1D. Percentage of Each Supplier’s Agreements Value by Region,
1999-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Table 1E. Percentage of Total Agreements Value by Supplier to Regions,
1999-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Table 1F. Arms Transfer Agreements with Developing Nations, 1999-2006:
Leading Suppliers Compared (in millions of current U.S. dollars) . . . . . . . 53
Table 1G. Arms Transfer Agreements with Developing Nations in 2006:
Leading Suppliers Compared (in millions of current U.S. dollars) . . . . . . . 54
Table 1H. Arms Transfer Agreements with Near East, by Supplier
(in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Table 1I. Arms Transfer Agreements of Developing Nations,
1999-2006: Agreements by the Leading Recipients
(in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56

Table 1J. Arms Transfer Agreements of Developing Nations in 2006:
Agreements by Leading Recipients (in millions of current U.S. dollars) . . 57
Table 2. Arms Deliveries to Developing Nations, by Supplier, 1999-2006
(in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Table 2A. Arms Deliveries to Developing Nations, by Supplier, 1999-2006
(in millions of constant 2006 U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . 59
Table 2B. Arms Deliveries to Developing Nations, by Supplier, 1999-2006
(expressed as a percent of total, by year) . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
Table 2C. Regional Arms Deliveries by Supplier, 1999-2006
(in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Table 2D. Percentage of Supplier Deliveries Value by Region, 1999-2006 . . . . 62
Table 2E. Percentage of Total Deliveries Value by Supplier to Regions,
1999-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Table 2F. Arms Deliveries to Developing Nations, 1999-2006
Leading Suppliers Compared
(in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Table 2G. Arms Deliveries to Developing Nations in 2006:
Leading Suppliers Compared
(in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Table 2H. Arms Deliveries to Near East, by Supplier
(in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Table 2I. Arms Deliveries to Developing Nations, 1999-2006:
The Leading Recipients
(in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Table 2J. Arms Deliveries to Developing Nations in 2006:
The Leading Recipients
(in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Table 3. Numbers of Weapons Delivered by Suppliers
to Developing Nations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Table 4. Number of Weapons Delivered by Suppliers
to Asia and the Pacific . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Table 5. Numbers of Weapons Delivered by Suppliers
to Near East . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Table 6. Numbers of Weapons Delivered by Suppliers
to Latin America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Table 7. Number of Weapons Delivered by Suppliers
to Africa . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
Table 8. Arms Transfer Agreements with the World, by Supplier,
1999-2006 (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . 80
Table 8A. Arms Transfer Agreements with the World, by Supplier,
1999-2006 (in millions of constant 2006 U.S. dollars) . . . . . . . . . . . . . . . . 81
Table 8B. Arms Transfer Agreements with the World, by Supplier,
1999-2006 (expressed as a percent of total, by year) . . . . . . . . . . . . . . . . . . 82
Table 8C. Arms Transfer Agreements with the World, 1999-2006:
Leading Suppliers Compared
(in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Table 8D. Arms Transfer Agreements with the World in 2006:
Leading Suppliers Compared
(in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
Table 9. Arms Deliveries to the World, by Supplier, 1999-2006
(in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85

Table 9A. Arms Deliveries to the World, by Supplier, 1999-2006
(in millions of constant 2006 U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . 86
Table 9B. Arms Deliveries to the World, by Supplier 1999-2006
(expressed as a percent of total, by year) . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
Table 9C. Arms Deliveries to the World, 1999-2006:
Leading Suppliers Compared
(in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
Table 9D. Arms Deliveries to the World in 2006:
Leading Suppliers Compared
(in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89

Conventional Arms Transfers to Developing
Nations, 1999-2006
Introduction and Overview
This report provides Congress with official, unclassified, background data from
U.S. government sources on transfers of conventional arms to developing nations by
major suppliers for the period 1999 through 2006. It also includes some data on
worldwide supplier transactions. It updates and revises CRS Report RL33696,
Conventional Arms Transfers to Developing Nations, 1998-2005.
The data in this report provide a means for Congress to identify existing
supplier-purchaser relationships in conventional weapons acquisitions. Use of these
data can assist Congress in its oversight role of assessing whether the current nature
of the international weapons trade affects U.S. national interests. For most of recent
American history, maintaining regional stability, and ensuring the security of U.S.
allies and friendly nations throughout the world, have been important elements of
U.S. foreign policy. Knowing the degree to which individual arms suppliers are
making arms transfers to individual nations or regions provides Congress with a
context for evaluating policy questions it may confront. Such policy questions may
include, for example, whether or not to support specific U.S. arms sales to given
countries or regions or to support or oppose such arms transfers by other nations.
The data in this report may also assist Congress in evaluating whether multilateral
arms control arrangements or other U.S. foreign policy initiatives are being supported
or undermined by the actions of arms suppliers.
The principal focus of this report is the level of arms transfers by major weapons
suppliers to nations in the developing world — where most of the potential for the
outbreak of regional military conflicts currently exists. For decades, during the height
of the Cold War, providing conventional weapons to friendly states was an
instrument of foreign policy utilized by the United States and its allies. This was
equally true for the Soviet Union and its allies. The underlying rationale for U.S.
arms transfer policy then was to help ensure that friendly states were not placed at
risk through a military disadvantage created by arms transfers by the Soviet Union
or its allies.
The data in this report illustrate how global patterns of conventional arms
transfers have changed in the post-Cold War and post-Persian Gulf War years.
Relationships between arms suppliers and recipients continue to evolve in response
to changing political, military, and economic circumstances. Where before the
principal motivation for arms sales by foreign suppliers might have been to support
a foreign policy objective, today that motivation may be based as much on economic
considerations as those of foreign or national security policy.

CRS-2
In this context, the developing world continues to be the primary focus of
foreign arms sales activity by conventional weapons suppliers. During the period of
this report, 1999-2006, conventional arms transfer agreements (which represent
orders for future delivery) to developing nations comprised 66.4% of the value of all
international arms transfer agreements. The portion of agreements with developing
countries constituted 65.7% of all agreements globally from 2003-2006. In 2006,
arms transfer agreements with developing countries accounted for 71.5% of the value
of all such agreements globally. Deliveries of conventional arms to developing
nations, from 2003-2006, constituted 73.3% of all international arms deliveries. In
2006, arms deliveries to developing nations constituted 73.6% of the value of all such
arms deliveries worldwide.
The data in this new report supersede all data published in previous editions.
Since these new data for 1999-2006 reflect potentially significant updates to and
revisions in the underlying databases utilized for this report, only the data in this most
recent edition should be used. The data are expressed in U.S. dollars for the calendar
years indicated, and adjusted for inflation (see box notes on page 3). U.S.
commercially licensed arms export delivery values are excluded (see box note on
page 20). Also excluded are arms transfers by any supplier to subnational groups.
The definition of developing nations, as used in this report, and the specific classes
of items included in its values totals are found in box notes on page 3. The report’s
table of contents provides a detailed listing and description of the various data tables
and summaries which can guide the reader to specific items of interest.

CRS-3
CALENDAR YEAR DATA USED
All arms transfer and arms delivery data in this report are for the calendar
year or calendar year period given. This applies to U.S. and foreign data alike.
United States government departments and agencies publish data on U.S. arms
transfers and deliveries but generally use the United States fiscal year as the
computational time period for these data. As a consequence, there are likely to be
distinct differences noted in those published totals using a fiscal year basis and
those provided in this report which use a calendar year basis. Details on data
used are outlined in footnotes at the bottom of Tables 1, 2, 8 and 9.

ARMS TRANSFER VALUES
The values of arms transfer agreements (or deliveries) in this report refer to the
total values of conventional arms orders (or deliveries as the case may be)
which include all categories of weapons and ammunition, military spare parts,
military construction, military assistance and training programs, and all
associated services.
DEFINITION OF DEVELOPING NATIONS AND REGIONS
As used in this report, the developing nations category includes all countries
except the United States, Russia, European nations, Canada, Japan, Australia, and
New Zealand. A listing of countries located in the regions defined for the purpose
of this analysis — Asia, Near East, Latin America, and Africa — is provided at the
end of the report.
CONSTANT 2006 DOLLARS
Throughout this report values of arms transfer agreements and values of arms
deliveries for all suppliers are expressed in U.S. dollars. Values for any given year
generally reflect the exchange rates that prevailed during that specific year. The
report converts these dollar amounts (current dollars) into constant 2006 dollars.
Although this helps to eliminate the distorting effects of U.S. inflation to permit
a more accurate comparison of various dollar levels over time, the effects of
fluctuating exchange rates are not neutralized. The deflators used for the
constant dollar calculations in this report are those provided by the U.S.
Department of Defense and are set out at the bottom of tables 1A, 2A, 8A, and
9A. Unless otherwise noted in the report, all dollar values are stated in
constant terms. The exceptions to this rule are all regional data tables that are
composed of four-year aggregate dollar totals (1999-2002 and 2003-2006). These
tables are expressed in current dollar terms. And where tables rank leading arms
suppliers to developing nations or leading developing nation recipients using fouryear aggregate dollar totals, these values are expressed in current dollars.

CRS-4

Major Findings
General Trends in Arms Transfers Worldwide
The value of all arms transfer agreements worldwide (to both developed and
developing nations) in 2006 was $40.3 billion. This was a decrease in arms
agreements values over 2005, a decline of nearly 13% (Chart 1)(Table 8A).
In 2006, the United States led in arms transfer agreements worldwide, making
agreements valued at $16.9 billion (41.9% of all such agreements),up from $13.5
billion in 2005. Russia ranked second with $8.7 billion in agreements (21.6% of
these agreements globally), up from $7.5 billion in 2005. The United Kingdom
ranked third, its arms transfer agreements worldwide standing at $3.1 billion in 2006,
up from $2.9 billion in 2005. The United States, Russia, and the United Kingdom
collectively made agreements in 2006 valued at $28.7 billion, 71.2% of all
international arms transfer agreements made by all suppliers (Figure 1)(Tables 8A,
8B, and 8D).
For the period 2003-2006, the total value of all international arms transfer
agreements ($160 billion) was higher than the worldwide value during 1999-2002
($156.7 billion), an increase of 2.1%. During the period 1999-2002, developing
world nations accounted for 67.1% of the value of all arms transfer agreements made
worldwide. During 2003-2006, developing world nations accounted for 65.7% of all
arms transfer agreements made globally. In 2006, developing nations accounted for
71.5% of all arms transfer agreements made worldwide (Figure 1)(Table 8A).
In 2006, the United States ranked first in the value of all arms deliveries
worldwide, making $14 billion in such deliveries or 51.9%. This is the eighth year
in a row that the United States has led in global arms deliveries. Russia ranked
second in worldwide arms deliveries in 2006, making $5.8 billion in such deliveries.
The United Kingdom ranked third in 2006, making $3.3 billion in such deliveries.
These top three suppliers of arms in 2006 collectively delivered nearly $23.1 billion,
85.6% of all arms delivered worldwide by all suppliers in that year (Figure 2)(Tables
9A, 9B, and 9D).
The value of all international arms deliveries in 2006 was $27 billion. This is
a increase in the total value of arms deliveries from the previous year (a rise from
$26.2 billion), but still the second lowest deliveries total for the 1999-2006 period.
Moreover, the total value of such arms deliveries worldwide in 2003-2006 ($120.7
billion) was substantially lower in the value of arms deliveries by all suppliers
worldwide from 1999-2002 ($144.8 billion, a decline of over $24 billion) (Figure
2)(Tables 9A and 9B)(Charts 7 and 8).
Developing nations from 2003-2006 accounted for 73.3% of the value of all
international arms deliveries. In the earlier period, 1999-2002, developing nations
accounted for 71.7% of the value of all arms deliveries worldwide. In 2006,
developing nations collectively accounted for 73.6% of the value of all international
arms deliveries (Figure 2)(Tables 2A, 9A, and 9B).

CRS-5
Worldwide weapons orders declined in 2006. The total of $40.3 billion, fell
from $46.3 billion in 2005, a decline of nearly 13%. Global arms agreement values
for the years other than 2006 ranged from $46.3 billion in 2005 to $31.7 billion in
2003. Of the major arms orders secured in 2006 most were made by the traditional
major suppliers. In some instances these orders represented significant new
acquisitions by the purchasing country. In others they reflected the continuation of
a longer term weapons acquisition program.
A decline in new weapons sales can also be explained, in part, by the practical
need for some purchasing nations to absorb and integrate major weapons systems
they have already purchased into their force structures. The need to do this may, at
the same time, increase the number of arms contracts related to training and support
services, even as it reduces the number of large and costly orders for new military
equipment.
An intensely competitive weapons marketplace continues to lead several
producing countries to focus sales efforts on prospective clients in nations and
regions where individual suppliers have had competitive advantages resulting from
well established military support relationships. Within Europe, arms sales to new
NATO member nations to support their military modernization programs have
created new business for arms suppliers, while allowing these NATO states to sell
some of their older generation military equipment, in refurbished form, to other lessdeveloped countries. While there are inherent limitations on these European sales
due to the smaller defense budgets of many of the purchasing countries, creative
seller financing options, as well as the use of co-assembly, co-production, and
counter-trade agreements to offset costs to the buyers, have continued to facilitate
new arms agreements. The United States and European countries or consortia seem
likely to compete vigorously for prospective arms contracts within the European
region in the foreseeable future. Such sales seem particularly important to European
suppliers, as they can potentially compensate, in part, for lost weapons deals
elsewhere in the developing world that result from reduced demand for new weapons.
Efforts also continue among developed nations to protect important elements
of their national military industrial bases by limiting arms purchases from other
developed nations. Nevertheless, several key arms suppliers have placed additional
emphasis on joint production of various weapons systems with other developed
nations as a more effective way to preserve a domestic weapons production
capability, while sharing the costs of new weapons development. The consolidation
of certain sectors of the domestic defense industries of key weapons producing
nations continues, in the face of intense foreign competition. At the same time, some
supplying nations have chosen to manufacture items for niche weapons categories
where their specialized production capabilities give them important advantages in the
evolving international arms marketplace.
Some developing nations have reduced their weapons purchases in recent years
primarily due to their limited financial resources to pay for such equipment. Other
prospective arms purchasers in the developing world with significant financial assets
have exercised caution in launching new and costly weapons procurement programs.
Increases in the price of oil, while an advantage for major oil producing states in
funding their arms purchases, has, simultaneously, caused economic difficulties for

CRS-6
many oil consuming states, contributing to their decisions to defer or curtail new
weapons purchases. The state of the world economy has induced a number of
developing nations to choose to upgrade existing weapons systems in their
inventories, while reducing their purchases of new ones. This approach may curtail
sales of new weapons systems for a time, but the weapons upgrade market can be
very lucrative for some arms producers, and partially mitigate the effect of losing
major new sales.
Although, overall, there appear to be fewer large weapons purchases being made
by developing nations in the Near East and in Asia, when contrasted with arms sales
activity over a decade ago, major purchases continue to be made by a select few
developing nations in these regions. These purchases have been made principally by
China and India in Asia, and Saudi Arabia in the Near East. Even though these
tendencies are subject to abrupt change based on the strength of either the regional
or international economies, or the threat assessments of individual states, the strength
of individual economies of a wide range of nations in the developing world continues
to be a significant factor in the timing of many of their arms purchasing decisions.
Latin America, and, to a much lesser extent, Africa, are regions where some
nations continue to express interest in modernizing important sectors of their military
forces. Some large arms orders (by regional standards) have been placed by a few
states in these two regions within the last decade. But in Latin America and Africa,
as with most nations in the developing world, nations are constrained in their
weapons purchases by their existing financial resources. So long as there is limited
availability of seller-supplied credit and financing for weapons purchases, and
national budgets for military purchases remain relatively low, it seems likely that
major arms sales to these two regions of the developing world will remain sporadic
in nature.

General Trends in Arms Transfers to Developing Nations
The value of all arms transfer agreements with developing nations in 2006 was
nearly $28.8 billion, a decrease from the $31.8 billion total in 2005 Chart 1)(Figure
1)(Table 1A). In 2006, the value of all arms deliveries to developing nations ($19.9
billion) was lower than the value of 2005 deliveries (over $20.3 billion), and the
lowest total for the 1999-2006 period (Charts 7 and 8)(Figure 2)(Table 2A).
Recently, from 2003-2006, the United States and Russia have dominated the
arms market in the developing world. The United States ranked first for 3 out of 4
years during this period, while Russia ranked second for 3 out of 4 of these years in
the value of arms transfer agreements. From 2003-2006, the United States made
$34.1 billion in arms transfer agreements with developing nations, 32.4% of all such
agreements. Russia, the second leading supplier during this period, made $25.8
billion in arms transfer agreements or 24.5%. The United Kingdom, the third leading
supplier, from 2003-2006 made $10.5 billion or 10% of all such agreements with
developing nations during these years. In the earlier period (1999-2002) the United
States ranked first with $45.4 billion in arms transfer agreements with developing
nations or 43.1%; Russia made $25.4 billion in arms transfer agreements during this
period or 24.1%. France made $5.5 billion in agreements or 5.2% (Table 1A).

CRS-7
From 1999-2006, most arms transfers to developing nations were made by two
to three major suppliers in any given year. The United States has ranked first among
these suppliers for seven of the last eight years during this period, falling to third
place in 2005. Russia has been a continuing strong competitor for the lead in arms
transfer agreements with developing nations, ranking second every year from 1999
through 2004, and first in 2005. Despite its lack of the larger traditional client base
for armaments held by the United States and the major West European suppliers,
Russia’s recent successes in concluding new arms orders suggests that Russia is
likely to continue to be, for the short term at least, a significant leader in arms
agreements with developing nations. Russia’s most significant high value arms
transfer agreements continue to be with China and India, Russia has had some
success in concluding arms agreements with clients beyond its principal two. Russia
continues to seek to expand its prospects in North Africa, the Middle East, and
Southeast Asia.
Most recently Russia has increased sales efforts in Latin America, despite
having essentially abandoned major arms sales efforts there following the Cold War’s
end. Venezuela has become a significant new arms client gained by Russia in this
region. The Russian government has further stated that it has adopted more flexible
payment arrangements for its prospective customers in the developing world,
including a willingness in specific cases to forgive outstanding debts owed to it by
a prospective client in order to secure new arms purchases. Furthermore, Russia
continues its efforts to enhance the quality of its follow-on support services to make
Russian products more attractive and competitive, and to assure its potential clients
that it can effectively provide timely service for weapons systems it exports.
Major West European arms suppliers, such as France and the United Kingdom,
have concluded large orders with developing countries over the last eight years, based
on either long-term supply relationships or their having specialized weapons systems
they can readily provide. Germany has been a key source of naval systems for
developing nations. Despite increased competition between the United States and the
other major arms suppliers, the U.S. appears likely to hold its position as the
principal supplier to key developing world nations, especially those able to afford
major new weapons. Because the United States has developed such a wide base of
arms equipment clients globally it is able to conclude a notable number of
agreements annually to provide upgrades, ordnance and support services for the large
variety of weapons systems it has sold to its clients for decades. Thus, even when the
U.S. does not conclude major new arms agreements in a given year, it can still
register significant arms agreement values based on transactions in these other
categories.
The wealthier developing countries continue as the focus for new arms sales by
the principal supplying nations. Arms transfers to the less affluent developing
nations also continue to be constrained by the scarcity of funds in their defense
budgets, and the unsettled state of the international economy. The overall decline in
the level of the arms agreements with developing nations that began in 2001 and
continued until 2004, appears to have halted. There was a rise in arms agreements
with the developing world in 2004 and again in 2005. Although there was a decline
in arms agreements with the developing world in 2006, the overall level of arms
agreements with such nations from 2004-2006 has been on the increase.

CRS-8
China, other European, and non-European suppliers, such as Sweden and Israel,
appear to have increased their participation in the arms trade with the developing
world in recent years, albeit at a much lower levels, and with uneven results, than
those of the major suppliers. Nevertheless, these non-major arms suppliers have
proven capable, on occasion, of making arms deals of consequence. Most of their
annual arms transfer agreement values during 1999-2006 have been comparatively
low, although larger when they are aggregated together as a group. In various cases
they have been successful in selling older generation equipment, even while they
procure newer weaponry to update their own military forces. These arms suppliers
also are more likely to be sources of small arms and light weapons, and associated
ordnance, rather than routine sellers of major military equipment. Most of these arms
suppliers are not likely to consistently rank with the traditional major suppliers of
advanced weaponry in the value of their arms agreements and deliveries (Tables 1A,
1F, 1G, 2A, 2F, and 2G).
United States. The total value — in real terms — of United States arms
transfer agreements with developing nations rose from $6.5 billion in 2005 to $10.3
billion in 2006. The U.S. share of the value of all such agreements was 35.8% in
2006, up from a 20.4% share in 2005 (Charts 1, 3 and 4)(Figure 1)(Tables 1A and
1B).
In 2006, the total value of U.S. arms transfer agreements with developing
nations was attributable to a couple of major deals with clients in Asia, particularly
with Pakistan, and in the Near East. A substantial number of smaller valued
purchases by a wide number of traditional U.S. arms clients throughout the Near East
and Asia contributed notably to the overall U.S. agreements total. The arms
agreement total of the United States in 2006 illustrates the continuing U.S. advantage
of having well established defense support arrangements with weapons purchasers
worldwide, based upon the existing variety of U.S. weapons systems their militaries
utilize. U.S. agreements with all of its clients in 2006 include not only sales of major
weapons systems, but also the upgrading of systems previously provided. The U.S.
totals also include agreements for a wide variety of spare parts, ammunition,
ordnance, training, and support services which, in the aggregate, have significant
value.
Among the larger valued arms transfer agreements the United States concluded
in 2006 with developing nations were: with Pakistan for the purchase of 36 F-16C/D
Block 50/52 fighter aircraft for $1.4 billion; a variety of missiles and bombs to be
utilized on the F-16 C/D fighter aircraft for over $640 million; the purchase of MidLife Update Modification Kits to upgrade Pakistan’s F-16A/B aircraft for $890
million; and for 115 M109A5 155mm Self-propelled howitzers for $52 million.
Other U.S. arms agreements in 2006 were with Saudi Arabia for re-manufacturing
and upgrading its AH-64A APACHE helicopters to the AH-64D model, together
with associated equipment for $340 million; for 165 LINK MIDS/LVT
communications terminals and associated equipment for $134 million; with the
United Arab Emirates for Evolved Seasparrow Ship to Air missiles for $106 million;
with Singapore for a variety of missiles, bombs and associated support for its F-15
fighter aircraft for $191 million, as well as for pilot training and support its F-16s for
$104 million; and with South Korea for 58 Harpoon Block II missiles for $114
million.

CRS-9
Russia. The total value of Russia’s arms transfer agreements with developing
nations in 2006 was $8.1 billion, a increase from $7.2 billion in 2005, placing Russia
second in such agreements with the developing world. Russia’s share of all
developing world arms transfer agreements increased, rose from 22.6% in 2005 to
28.1% in 2006 (Charts 1, 3, and 4)(Figure 1)(Tables 1A, 1B, and 1G).
Russian arms transfer agreement totals with developing nations have been
notable during the last four years. During the 2003-2006 period, Russia ranked
second among all suppliers to developing countries, making $25.8 billion in
agreements (in current 2006 dollars) (Table 1F). Russia’s status as a leading
supplier of arms to developing nations stems from an increasingly successful effort
to overcome the significant economic and political problems associated with the
dissolution of the former Soviet Union. The traditional arms clients of the former
Soviet Union were generally less wealthy developing countries valued as much for
their political support in the Cold War, as for their desire for Soviet weaponry. Many
of these Soviet-era client states received substantial military aid grants and significant
discounts on their arms purchases. After 1991 Russia consistently placed a premium
on obtaining hard currency for the weapons it sold. Faced with stiff competition
from Western arms suppliers in the 1990s and the early part of this decade, Russia
gradually adapted its selling practices in an effort to regain and sustain an important
share of the developing world arms market.
Russian leaders, in recent years, have made significant efforts to provide more
creative financing and payment options for prospective arms clients. They have also
agreed to engage in counter-trade, offsets, debt-swapping, and, in key cases, to make
significant licensed production agreements in order to sell its weapons. The
willingness to license production has been a central element in several cases
involving Russia’s principal arms clients, China and India. Russia’s efforts to
expand its arms customer base have met with mixed results. Russia’s arms sales
efforts, beyond those with China and India, have been primarily focused on Southeast
Asia. It has had some success in securing arms agreements with Malaysia, Vietnam
and Indonesia, even though recurring financial problems of some clients in this
region have hampered significant growth in Russian sales there. Most recently it has
concluded major arms deals with Venezuela and with Algeria. Elsewhere in the
developing world Russian military equipment is competitive because it ranges from
the most basic to the highly advanced, and can be less expensive than similar arms
available from other major suppliers.
Sale of military aircraft and missiles continues to be a significant portion of
Russia’s arms exports. Yet the absence of major new research and development
efforts in this and other military equipment areas may jeopardize long-term Russian
foreign arms sales prospects. While military weapons research and development
(R&D) programs exist in Russia, other major arms suppliers in the West are currently
well advanced in the process of developing and producing weaponry that is much
more advanced than that in existing Russian R&D programs.
In spite of these potential difficulties, Russia continues to have important arms
development and sales programs involving China and India, which should provide
it with sustained business throughout this decade. Through agreements concluded

CRS-10
in the mid-1990s, Russia has sold major combat fighter aircraft, and main battle tanks
to India, and has provided other major weapons systems though lease or licenced
production. It continues to provide support services and items for these various
weapons systems. In 2006, Russia largest arms agreement with India was for the
sale of 3 Talwar-class frigates for an estimated $1.3-1.6 billion.
Sales of advanced weaponry in South Asia by Russia have been a matter of
ongoing concern to the United States, because of long-standing tensions between
India and Pakistan. The acquisition of a new weapon system by India has usually led
Pakistan to seek comparable weapons or those with offsetting capabilities. Keeping
a potentially destabilizing arms race in this region within check is a U.S. policy
objective.1
Russia’s other key arms client in Asia has been China, especially for advanced
aircraft and naval systems. Since 1996, Russia has sold China Su-27 fighter aircraft
and agreed to licensed production of them. It has sold the Chinese quantities of Su30 multi-role fighter aircraft, Sovremenny-class destroyers equipped with Sunburn
anti-ship missiles, and Kilo-class Project 636 submarines. Russia has also sold the
Chinese a variety of other weapons systems and missiles. In 2005, Russia agreed to
sell China 30 IL-76TD military transport aircraft and 8 IL-78M aerial refueling tanker
aircraft for more than $1 billion. Russia also signed new arms transfer agreements
with China for a number of AL-31F military aircraft engines for $1 billion, and
agreed to sell jet engines for China’s FC-1 fighter aircraft at a cost in excess of $250
million. Chinese arms acquisitions are apparently aimed at enhancing its military
projection capabilities in Asia, and its ability to influence events throughout the
region. These acquisitions continue to be monitored by U.S. policymakers. The U.S.
policy interest is, among other things, ensuring that it provides appropriate military
equipment to U.S. allies and friendly states in Asia to help offset any prospective
threat China may pose to such nations, while keeping the U.S. military aware of any
threat it may face in any confrontation with China.2 In 2006 there were no especially
large Chinese arms agreements with Russia, possibly because the Chinese military
is focused on absorbing and integrating previous arms purchases from Russia into its
force structure.
Among the most significant arms transfer deals Russia made in 2006, was with
Algeria. This package of agreements included the sale of 28 Su-30MKA fighter
aircraft, 36 Mig-29SMT fighter aircraft, 16 Yak-130 advanced training aircraft; 8
battalions of S-300 PMU-2 SAM systems, a number of Pantsir-S1 (SA-22) airdefense missile systems, and a number of T-90S Main Battle Tanks. The total cost
of all of these weapons and associated equipment is estimated at $7.5 billion.
1

For detailed background see CRS Report RL33515, Combat Aircraft Sales to South Asia:
Potential Implications, by Christopher Bolkcom, Richard F. Grimmett, and K. Alan
Kronstadt; CRS Report RL32115, Missile Proliferation and the Strategic Balance in South
Asia, by Andrew Feickert and K. Alan Kronstadt; and CRS Report RL30427, Missile
Survey: Ballistic and Cruise Missiles of Selected Foreign Countries, by Andrew Feickert.

2

For detailed background see CRS Report RL30700, China’s Foreign Conventional Arms
Acquisitions: Background and Analysis, by Shirley Kan, Christopher Bolkcom, and Ronald
O'Rourk; and CRS Report RL33153, China Naval Modernization: Implications for U.S.
Navy Capabilities — Background and Issues for Congress, by Ronald O'Rourke.

CRS-11
However, about $4.7 billion of this total is being paid through forgiveness of
Algerian debt to Russia, thus lowering the overall value of the sales package.
In 2006, Russia also made substantial new arms sales to Venezuela. Venezuela
has major oil reserves. It, therefore, has the means to pay for advanced, and
expensive, military equipment, making it a very attractive customer for Russia.
During 2006 Russia reached a significant agreement with Venezuela for the sale of
a package of military aircraft. Key elements of this agreement included the sale of
24 Su-30MK2V fighter aircraft for an amount in excess of $1 billion, together with
the purchase of a number of attack and transport helicopters, including Mi-17, Mi-26,
and Mi-35 models, collectively costing in excess of $700. Russia also sold
Venezuela a substantial number of AK-103 assault rifles, and agreed to establish a
factory in Venezuela for the production of both AK-103 assault rifles and the
production of 7.62mm ammunition at a cost in excess of $500 million. Venezuela’s
populist President, Hugo Chavez, has taken a hostile approach to relations with the
United States in recent years. Thus his decision to seek advanced military equipment
from Russia is a matter of U.S. concern. Chavez appears embarked on a effort to
make Venezuela an important military force in Latin America. And since he has
made clear that he plans to obtain additional advanced weapons systems from Russia,
there is concern that such purchases could stimulate other states in the region to seek
comparable weapons systems as a counterweight to Chavez’s military buildup.3
China. In the 1980s the Iran-Iraq war provided the opportunity for China to
become an important supplier of less expensive weapons to certain developing
nations. During that conflict China demonstrated that it was willing to provide arms
to both combatants in the war, in quantity and without conditions. From 2003-2006,
the value of China’s arms transfer agreements with developing nations averaged
about $1.3 billion annually, a figure skewed by a very large agreements total of $2.6
billion in 2005. During the period of this report, the value of China’s arms transfer
agreements with developing nations peaked in 1999 at $2.8 billion. China’s sales
figures that year, and in 2005, generally resulted from several smaller valued
weapons deals in Asia, Africa, and the Near East, rather than one or two especially
large agreements for major weapons systems. Similar arms deals with small scale
purchasers in these regions are continuing. In 2006, China’s arms transfer
agreements total was $800 million, a figure reflecting a variety of smaller sales to a
range of established customers (Tables 1A, 1G, and 1H)(Chart 3).
Few nations with significant financial resources have sought to purchase
Chinese military equipment during the eight year period of this report, because most
Chinese weapons for export are less advanced and sophisticated than weaponry
available from Western suppliers or Russia. China, consequently, does not appear
likely to be a major supplier of conventional weapons in the international arms
market in the foreseeable future. Its most likely clients are states in Asia and Africa
seeking quantities of small arms and light weapons, rather than major combat
systems. At the same time, China has been an important source of missiles in the
developing world arms market. China supplied Silkworm anti-ship missiles to Iran.
3

For detailed background on Chavez’s policy initiatives in Venezuela, and U.S. concerns
see CRS Report RL32488, Venezuela: Political Conditions and U.S. Policy, by Mark P.
Sullivan and Nelson Olhero.

CRS-12
Credible reports persist in various publications that China has sold surface-to-surface
missiles to Pakistan, a long-standing and important client. Iran and North Korea have
also reportedly received Chinese missile technology, which has increased their
capabilities to threaten other countries in their respective neighborhoods. The
continued reporting of such activities by credible sources raise important questions
about China’s stated commitment to the restrictions on missile transfers set out in the
Missile Technology Control Regime (MTCR), including its pledge not to assist
others in building missiles that could deliver nuclear weapons. Since China has some
military products — particularly missiles — that some developing countries would
like to acquire, it can present an obstacle to efforts to stem proliferation of advanced
missile systems to some areas of the developing world where political and military
tensions are significant, and where some nations are seeking to develop asymmetric
military capabilities.4
China, among others, has been a key source of a variety of small arms and light
weapons transferred to African states. Although the prospects for significant revenue
earnings from these arms sales are limited, China views such sales as one means of
enhancing its status as an international political power, and increasing its ability to
obtain access to significant natural resources, especially oil. Controlling the sales
of small arms and light weapons to regions of conflict, in particular to some African
nations, has been a matter of concern to the United States. The United Nations also
has undertaken an examination of this issue in an effort to achieve consensus on a
path to address it.5
Major West European Suppliers. Beyond the United States and Russia,
the four major West European arms suppliers — France, the United Kingdom,
Germany, and Italy — are the nations that can supply a wide variety of more highly
sophisticated weapons to would-be purchasers. They can serve as alternative sources
of armaments that the United States chooses not to supply for policy reasons. The
United Kingdom sold major combat fighter aircraft to Saudi Arabia in the mid-1980s,
when the U.S. chose not to sell a comparable aircraft for policy reasons. These four
NATO nations have been allies of the United States especially during the Cold War.
Yet in the post-Cold War era, their national defense export policies have not been
fully coordinated with the United States as likely would have been the case at the
Cold War’s height.
These European arms supplying states, particularly France, view arms sales
foremost as a matter for national decision. France has also frequently used foreign
military sales as an important means for underwriting development and procurement
4

For detailed background on the MTCR and proliferation control regimes and related policy
issues see CRS Report RL31559, Proliferation Control Regimes: Background and Status,
coordinated by Sharon Squassoni, and CRS Report RL31848, Missile Technology Control
Regime (MTCR) and International Code of Conduct Against Ballistic Missile Proliferation
(ICOC): Background and Issues for Congress, by Andrew Feickert.
5

For background on China’s actions and motivations for increased activities in Africa see
CRS Report RL33055, China and Sub-Saharan Africa, by Raymond W. Copson, Kerry
Dumbaugh, and Michelle Lau. For background on U.S. policy concerns regarding small
arms and light weapons transfers see CRS Report RS20958, International Small Arms and
Light Weapons Transfers: U.S. Policy, by Richard F. Grimmett.

CRS-13
of weapons systems for its own military forces. So the potential exists for policy
differences between the United States and major West European supplying states
over conventional weapons transfers to specific countries. Such a conflict resulted
from an effort led by France and Germany to lift the arms embargo on arms sales to
China currently adhered to by members of the European Union. The United States
viewed this as a misguided effort, and vigorously opposed it. The proposal to lift the
embargo was ultimately not adopted, but it proved to be a source of significant
tension between the U.S. and the European Union. Thus, arms sales activities of
major European suppliers continue to be of interest to U.S. policymakers, given their
capability to make sales of advanced military equipment to countries of concern to
U.S. national security policy.6
The four major West European suppliers (France, the United Kingdom,
Germany, and Italy), as a group, registered a decline in their collective share of all
arms transfer agreements with developing nations between 2005 and 2006. This
group’s share fell from 34.4% in 2005 to 19.1% in 2006. The collective value of this
group’s arms transfer agreements with developing nations in 2006 was $5.5 billion
compared with a total of $10.9 billion in 2005. Of these four nations, the United
Kingdom was the leading supplier with $3.1 billion in agreements in 2006, an
increase from $2.9 billion in agreements in 2005. A substantial portion of the United
Kingdom’s $3.1 billion agreement total in 2006 was attributable to orders placed
under the Al Yamamah military procurement arrangement with Saudi Arabia.
Germany’s $1.8 billion in arms agreements in 2006 resulted from an agreement with
Brazil for licensed production of a Type ILK 214 submarine and the upgrading of
five existing Type 209 submarines, and from an Israeli order for two Type 800
Dolphin class submarines (Charts 3 and 4)(Tables 1A and 1B).
The four major West European suppliers collectively held a 19.1% share of all
arms transfer agreements with developing nations during 2006. For four years after
1999, the major West European suppliers continued to lose their relative share of
arms transfer agreements. In 2004 and 2005 this decline was dramatically halted,
with the 2005 market share of arms agreements with developing nations (34.4%)
being the highest share the four major West European suppliers have held since 1999.
During the 2003-2006 period, they collectively held 23% of all arms transfer
agreements with developing nations ($24.2 billion). Individual suppliers within the
major West European group have had notable years for arms agreements, especially
France in 2000 and 2005 ($2.6 billion and $6.7 billion respectively). The United
Kingdom also had large agreement years in 2004 ($4.4 billion), in 2005 ($2.9
billion), and $3.1 billion in 2006. Germany concluded arms agreements totaling
nearly $2 billion in 1999, and $1.8 billion in 2006. In the case of each of these three
European nations, large agreement totals in one year have usually reflected the

6

For detailed background see CRS Report RL32870, European Union’s Arms Embargo on
China: Implications and Options for U.S. Policy, by Kristin Archick, Richard F. Grimmett,
and Shirley Kan. It should be noted that members of the European Union, and others, have
agreed to a common effort to attempt some degree of control on the transfer of certain
weapons systems, but the principal vehicle for this cooperation — the Wassenaar
Arrangement — lacks a mechanism to enforce its rules. For detailed background see CRS
Report RS20517, Military Technology and Conventional Weapons Exports Controls: The
Wassenaar Arrangement, by Richard F. Grimmett.

CRS-14
conclusion of very large arms contracts with one or more major purchasers in that
particular year (Table 1A and 1B).
Major West European suppliers have had their competitive position in weapons
exports strengthened over the years through strong government marketing support for
their foreign arms sales. As they all can produce both advanced and basic air,
ground, and naval weapons systems, the four major West European suppliers have
competed successfully for arms sales contracts with developing nations against both
the United States, which has tended to sell to several of the same clients, and with
Russia, which has sold to nations not traditional customers of either the West
Europeans or the United States. However, the demand for U.S. weapons in the
global arms marketplace, from a large established client base, has created a more
difficult environment for individual West European suppliers to secure large new
contracts with developing nations on a sustained basis.
Continuing strong demand for U.S. defense equipment as well as concern for
maintaining their market share of the arms trade has led European Union (EU)
member states to adopt a new code of conduct for defense procurement practices.
This code was agreed to on November 21, 2005 at the European Defense Agency’s
(EA) steering board meeting. Currently voluntary, the EU hopes it will become
mandatory, and through its mechanisms foster greater competition within the
European defense equipment sector in the awarding of contracts for defense items.
A larger hope is that by fostering greater intra-European cooperation and
collaboration in defense contracting, and the resulting programs, that the defense
industrial bases of individual EU states will be preserved, and the ability of European
defense firms to compete for arms sales in the international arms marketplace will
be substantially enhanced.
Some European arms suppliers have begun to phase out production of certain
types of weapons systems. Such suppliers have increasingly engaged in joint
production ventures with other key European weapons suppliers or even client
countries in an effort to sustain major sectors of their individual defense industrial
bases — even if a substantial portion of the weapons produced are for their own
armed forces. The Eurofighter project is one example; the Eurocopter is another.
Other European suppliers have also adopted the strategy of cooperating in defense
production ventures with the United States such as the Joint Strike Fighter (JSF),
rather than attempting to compete directly, thereby meeting their own requirements
for advanced combat aircraft, while positioning themselves to share in profits
resulting from future sales of this new fighter aircraft.7

Regional Arms Transfer Agreements
The markets for arms in regions of the developing world have traditionally been
dominated by the Near East and by Asia. Nations in the Latin America and Africa
regions, by contrast, have not been major purchasers of weapons, except on rare

7

For detailed background on issues relating to the Joint Strike Fighter program see CRS
Report RL30563, F-35 Joint Strike Fighter (JSF) Program: Background, Status, and Issues,
by Christopher Bolkcom.

CRS-15
occasions. The regional arms agreement data tables in this report demonstrate this.
United States policymakers have placed emphasis on helping to maintain stability
throughout the regions of the developing world. Thus, the U.S. has made and
supported arms sales and transfers it has believed would advance that goal, while
discouraging significant sales by other suppliers to states and regions where military
threats to nations in the area are minimal. Other arms suppliers do not necessarily
share the U.S. perspective on what constitutes an appropriate arms sale. For in some
instances the financial benefit of the sale to the supplier trumps other considerations.
The regional and country specific arms transfer data in this report provide an
indication of where various arms suppliers are focusing their attention, and who their
principal clients are. By reviewing these data, policymakers can identify potential
developments which may be of concern, and use this information to assist their
review of options they may choose to consider given the circumstances. What
follows below is a review of data on arms transfer agreement activities in the two
regions that lead in arms acquisitions, the Near East and Asia. This is followed, in
turn, by a review of data regarding the leading arms purchasers in the developing
world.
Near East.8 The principal catalyst for new weapons procurements in the Near
East region in the last decade was the Persian Gulf crisis of August 1990-February
1991. This crisis, culminating in a war to expel Iraq from Kuwait, created new
demands by key purchasers such as Saudi Arabia, Kuwait, the United Arab Emirates,
and other members of the Gulf Cooperation Council (GCC), for a variety of
advanced weapons systems. Egypt and Israel continued their modernization and
increased their weapons purchases from the United States. The Gulf states’ arms
purchase demands were not only a response to Iraq’s aggression against Kuwait, but
a reflection of concerns regarding perceived threats from a potentially hostile Iran.
Since the fall of Saddam Hussein, for many, the conventional ground threat from Iraq
has diminished and the perceived threat from Iran has increased. This has led the
GCC states to emphasize acquisition of air and naval defense capabilities over major
ground combat systems.9
Most recently, the position of Saudi Arabia as principal arms purchaser in the
Persian Gulf region has been re-established. In the period from 1999-2002, Saudi
Arabia’s total arms agreements were valued at $4 billion (in current dollars), less
than the levels of the U.A.E., Egypt and Israel. For the period from 2003-2006,
Saudi Arabia’s total arms agreements were $12.4 billion (in current dollars), making
it the leading Near East purchaser once again.
The Near East has generally been the largest arms market in the developing
world. However, in 1999-2002, it accounted for 36.5% of the total value of all
developing nations arms transfer agreements ($29.7 billion in current dollars),

8

In this report the Near East region includes the following nations: Algeria, Bahrain, Egypt,
Iran, Iraq, Israel, Jordan, Kuwait, Lebanon, Libya, Morocco, Oman, Qatar, Saudi Arabia,
Syria, Tunisia, United Arab Emirates, and Yemen. The countries included in the other
geographic regions are listed at the end of the report.

9

For detailed background see CRS Report RL31533, The Persian Gulf States: Issues for
U.S. Policy, 2006, by Kenneth Katzman.

CRS-16
ranking it second behind Asia which was first with 47.6% of these agreements. But,
during 2003-2006, the Near East region accounted for 46.6% of all such agreements
($46.7 billion in current dollars), again placing it first in arms agreements with the
developing world. The Asia region ranked second in 2003-2006 with $38.8 billion
in agreements or 38.7% (Tables 1C and 1D).
The United States dominated arms transfer agreements with the Near East
during the 1999-2002 period with 68.4% of their total value ($20.3 billion in current
dollars). Russia was second during these years with 8.1% ($2.4 billion in current
dollars). Recently, from 2003-2006, the United States accounted for 48.9% of arms
agreements with this region ($22.8 billion in current dollars), while the United
Kingdom accounted for 16.5% of the region’s agreements ($7.7 billion in current
dollars). Russia accounted for 13.7% of the region’s agreements in the most recent
period ($6.4 billion in current dollars) (Chart 5)(Tables 1C and 1E).
Asia. Efforts in several developing nations in Asia have been focused on
upgrading and modernizing defense forces, and this has led to new conventional
weapons sales in that region. Since the mid-1990s, Russia has become the principal
supplier of advanced conventional weaponry to China — selling fighters,
submarines, destroyers, and missiles — while maintaining its position as principal
arms supplier to India. Russian arms sales to these two countries have been primarily
responsible for the increase in Asia’s overall share of the arms market in the
developing world. Russia has expanded its client base in Asia, receiving aircraft
orders from Malaysia, Vietnam, and Indonesia. India has also expanded its weapons
supplier base, purchasing the Phalcon early warning defense system aircraft in 2004
from Israel for $1.1 billion, and numerous items from France in 2005, in particular
6 Scorpene diesel attack submarines for $3.5 billion. A multi-billion dollar sale in
2006 by the United States to Pakistan of new F-16 fighter aircraft, weapons, and
aircraft upgrades, together with Sweden’s sale to it of a SAAB-2000 based AWACS
airborne radar system for over a billion dollars has placed Pakistan in the forefront
of recent Asian buyers. The data on regional arms transfer agreements from 19992006 continue to reflect that Near East and Asian nations are the primary sources of
orders for conventional weaponry in the developing world.
Asia has traditionally been the second largest developing world arms market.
In 2003-2006, Asia ranked second, accounting for 38.7% of the total value of all
arms transfer agreements with developing nations ($38.8 billion in current dollars).
Yet in the earlier period, 1999-2002, the region ranked first, accounting for 47.6%
of all such agreements ($38.8 billion in current dollars) (Tables 1C and 1D).
In the earlier period (1999-2002), Russia ranked first in the value of arms
transfer agreements with Asia with 45.4% ($17.6 billion in current dollars). The
United States ranked second with 24.4% ($9.5 billion in current dollars). The major
West European suppliers, as a group, made 12.6% of this region’s agreements in
1999-2002. In the later period (2003-2006), Russia ranked first in Asian agreements
with 37.1% ($14.4 billion in current dollars), primarily due to major combat aircraft,
and naval system sales to India and China. The United States ranked second with
18.6% ($7.2 billion in current dollars). The major West European suppliers, as a
group, made 19.3% of this region’s agreements in 2003-2006. (Chart 6)(Table 1E).

CRS-17

Leading Developing Nations Arms Purchasers
India was the leading developing world arms purchaser from 1999-2006,
making arms transfer agreements totaling $22.4 billion during these years (in current
dollars). In the 1999-2002 period, China ranked first in arms transfer agreements at
$11 billion (in current dollars). In 2003-2006 India ranked first in arms transfer
agreements, with a large increase to $14.9 billion from $7.5 billion in the earlier
1999-2002 period (in current dollars). This increase reflects the continuation of a
military modernization effort by India, underway since the 1990s, based primarily on
major arms agreements with Russia. The total value of all arms transfer agreements
with developing nations from 1999-2006 was $188.9 billion in current dollars. Thus
India alone accounted for 11.9% of all developing world arms transfer agreements
during these eight years. In the most recent period, 2003-2006, India made $14.9
billion in arms transfer agreements (in current dollars). This total constituted 14.4%
of all arm transfer agreements with developing nations during these four years
($100.3 billion in current dollars). China ranked second in arms transfer agreements
during 2003-2006 with $12.4 billion (in current dollars), or 12.4% of the value of all
developing world arms transfer agreements (Tables 1, 1I, and 1J).
During 1999-2002, the top ten recipients collectively accounted for 69.8% of
all developing world arms transfer agreements. During 2003-2006, the top ten
recipients collectively accounted for 64.4% of all such agreements. Arms transfer
agreements with the top ten developing world recipients, as a group, totaled $22.2
billion in 2006 or 77.1% of all arms transfer agreements with developing nations in
that year. These percentages reflect the continued concentration of major arms
purchases by developing nations among a few countries (Tables 1, 1I, and 1J).
Pakistan ranked first among all developing world recipients in the value of arms
transfer agreements in 2006, concluding $5.1 billion in such agreements. India
ranked second in agreements at $3.5 billion. Saudi Arabia ranked third with $3.2
billion in agreements. Four of the top ten recipients were in the Near East region;
four were in the Asian region; two were in the Latin American region (Table 1J).10
Saudi Arabia was the leading recipient of arms deliveries among developing
world recipients in 2006, receiving $4.1 billion in such deliveries. China ranked
second in arms deliveries in 2006 with $2.9 billion. Israel ranked third with $1.5
billion (Table 2J).
Arms deliveries to the top ten developing nation recipients, as a group, were
valued at $14.3 billion, or 71.9% of all arms deliveries to developing nations in 2006.
Six of these top ten recipients were in Asia; three were in the Near East; one was in
Latin America (Tables 2 and 2J).

10

For countries included in the Asia region and the Latin American region see the listings
of nations by regions given at the end of this report.

CRS-18

Weapons Types Recently Delivered to Near East Nations
Regional weapons delivery data reflect the diverse sources of supply and type
of conventional weaponry actually transferred to developing nations. Even though
the United States, Russia, and the four major West European suppliers dominate in
the delivery of the fourteen classes of weapons examined, it is also evident that the
other European suppliers and some non-European suppliers, including China, are
capable of being leading suppliers of selected types of conventional armaments to
developing nations (Tables 3-7) (pages 72-76).
Weapons deliveries to the Near East, historically the largest purchasing region
in the developing world, reflect the quantities and types delivered by both major and
lesser suppliers. The following is an illustrative summary of weapons deliveries to
this region for the period 2003-2006 from Table 5:
United States.
! 349 tanks and self-propelled guns
! 715 APCs and armored cars
! 2 major surface combatants
! 5 minor surface combatants
! 71 supersonic combat aircraft
! 66 helicopters
! 465 surface-to-air missiles
! 87 anti-ship missiles
Russia.
! 120 APCs and armored cars
! 20 supersonic combat aircraft
! 30 helicopters
! 1,240 surface-to-air missiles
China.
! 20 artillery pieces
! 50 anti-ship missiles
Major West European Suppliers.
! 120 tanks and self-propelled guns
! 60 APCs and armored cars
! 4 major surface combatants
! 46 minor surface combatants
! 10 guided missile boats
! 30 supersonic combat aircraft
! 20 helicopters
! 40 anti-ship missiles
All Other European Suppliers.
! 300 tanks and self-propelled guns
! 1,250 APCs and armored cars
! 20 minor surface combatants
! 2 guided missile boats

CRS-19
!
!
!
!

10 supersonic combat aircraft
10 helicopters
320 surface-to-air missiles
10 anti-ship missiles

All Other Suppliers.
! 640 APCs and armored cars
! 98 minor surface combatants
! 30 helicopters
! 40 surface-to-surface missiles
! 10 anti-ship missiles
Large numbers of major combat systems were delivered to the Near East region
from 2003-2006, specifically, tanks and self-propelled guns, armored vehicles, major
and minor surface combatants, supersonic combat aircraft, helicopters, air defense
and anti-ship missiles. The United States and Russia made deliveries of supersonic
combat aircraft to the region. The United States, China, and the European suppliers
delivered many anti-ship missiles. The United States, Russia, and European
suppliers in general were principal suppliers of tanks and self-propelled guns, APCs
and armored cars, surface-to-air missiles, as well as helicopters. Three of these
weapons categories — supersonic combat aircraft, helicopters, and tanks and selfpropelled guns — are especially costly and are a large portion of the dollar values of
arms deliveries by the United States, Russia, and European suppliers to the Near East
region during the 2003-2006 period.
The cost of naval combatants is also generally high, and the suppliers of such
systems during this period had their delivery value totals notably increased due to
these transfers. Some of the less expensive weapons systems delivered to the Near
East are, nonetheless, deadly and can create important security threats within the
region. In particular, from 2003-2006, the United States delivered 87 anti-ship
missiles to the Near East region, China delivered 50, and the four major West
European suppliers delivered 40. The United States delivered two major surface
combatants and five minor surface combatants to the Near East, while the major
West European suppliers collectively delivered four major surface combatants, 46
minor surface combatants and 10 guided missile boats. The non-major West
European suppliers collectively delivered 10 anti-ship missiles. Other non-European
suppliers collectively delivered 640 APCs and armored cars, 98 minor surface
combatants, as well as 40 surface-to-surface missiles, a weapons category not
delivered by any of the other major weapons suppliers during this period to any
region.

CRS-20
UNITED STATES COMMERCIAL ARMS EXPORTS
United States commercially licensed arms deliveries data are not included in
this report. The United States is the only major arms supplier that has two distinct
systems for the export of weapons: the government-to-government Foreign
Military Sales (FMS) system, and the licensed commercial export system. It should
be noted that data maintained on U.S. commercial sales agreements and deliveries
are incomplete, and are not collected or revised on an on-going basis, making them
significantly less precise than those for the U.S. FMS program — which accounts
for the overwhelming portion of U.S. conventional arms transfer agreements and
deliveries involving weapons systems. There are no official compilations of
commercial agreement data comparable to that for the FMS program maintained
on an annual basis. Once an exporter receives from the State Department a
commercial license authorization to sell — valid for four years — there is no
current requirement that the exporter provide to the State Department, on a
systematic and on-going basis, comprehensive details regarding any sales contract
that results from the license authorization, including if any such contract is reduced
in scope or cancelled. Nor is the exporter required to report that no contract with
the prospective buyer resulted.
Annual commercially licensed arms deliveries data are obtained from
shipper’s export documents and completed licenses from ports of exit by the U.S.
Customs and Border Protection Agency which are then provided to the U.S.
Census Bureau. The Census Bureau takes these arms export data, and, following
a minimal review of them, submits them to the Directorate of Defense Trade
Controls in the Political-Military Bureau (PM/DDTC) of the State Department,
which makes the final compilation of such data — details of which are not
publicly available. Once compiled by the Directorate of Defense Trade Controls
at the State Department, these commercially licensed arms deliveries data are not
revised. By contrast, the U.S. Foreign Military Sales (FMS) program data, for both
agreements and deliveries, maintained by the Defense Department, are
systematically collected, reviewed for accuracy on an on-going basis, and are
revised from year-to-year as needed to reflect any changes or to correct any errors
in the information. This report includes all FMS deliveries data. By excluding
U.S. commercial licensed arms deliveries data, the U.S. arms delivery totals will
be understated.
Some have suggested that a systematic data collection and reporting system
for commercial licensed exports, comparable to the one which exists now in the
Department of Defense, should be established by the Department of State. Having
current and comprehensive agreement and delivery data on commercially licensed
exports would provide a more complete picture of the U.S. arms export trade, in
this view, and thus facilitate Congressional oversight of this sector of U.S. exports.

CRS-21

Summary of Data Trends, 1999-2006
Tables 1 through 1J (pages 47-57) present data on arms transfer agreements
with developing nations by major suppliers from 1999-2006. These data show the
most recent trends in arms contract activity by major suppliers. Delivery data, which
reflect implementation of sales decisions taken earlier, are shown in Tables 2
through 2J (pages 58-68). Tables 8, 8A, 8B, 8C, and 8D (pages 80-84) provide
data on worldwide arms transfer agreements from 1999-2006, while Tables 9, 9A,
9B, 9C, and 9D (pages 85-89) provide data on worldwide arms deliveries during this
period. To use these data regarding agreements for purposes other than assessing
general trends in seller/buyer activity is to risk drawing conclusions that can be
readily invalidated by future events — precise values and comparisons, for example,
may change due to cancellations or modifications of major arms transfer agreements.
These data sets reflect the comparative magnitude of arms transactions by arms
suppliers with recipient nations expressed in constant dollar terms, unless otherwise
noted.
What follows is a detailed summary of data trends from the tables in the report.
The summary statements also reference tables and/or charts pertinent to the point(s)
noted. Where graphic representations of some major points are made in individual
charts, their underlying data are taken from the pertinent tables of this report.

Total Developing Nations Arms Transfer Agreement Values
Table 1 shows the annual current dollar values of arms transfer agreements with
developing nations. Since these figures do not allow for the effects of inflation, they
are, by themselves, of limited use. They provide, however, the data from which
Table 1A (constant dollars) and Table 1B (supplier percentages) are derived. Some
of the facts reflected by these data are summarized below.
!

The value of all arms transfer agreements with developing nations
in 2006 was $28.8 billion, a decrease from the $31.8 billion total in
2005 (Tables 1 and 1A)(Chart 1).

!

The total value of United States agreements with developing nations
rose from $6.5 billion in 2005 to $ 10.3 billion in 2006. The United
States’ share of all developing world arms transfer agreements in
2006 was 35.8%, up from 20.4% in 2005 (Tables 1A and
1B)(Chart 3).

!

In 2006, the total value, in real terms, of Russian arms transfer
agreements with developing nations increased from the previous
year, rising from $7.2 billion in 2005 to $8.1 billion in 2006. The
Russian share of all such agreements increased from 22.6% in 2005
to 28.1% in 2006 (Charts 3 and 4)(Tables 1A and 1B).

CRS-22

Chart 1. Arms Transfer Agreements Worldwide, 1999-2006
Developed and Developing Worlds Compared

In billions of constant
2006 dollars
55
Developed World
50

Developing World

45
40
35
30
25
20
15
10
5
0
1999

2000

Source: U.S. Government

2001

2002

2003

2004

2005

2006

CRS-23

Chart 2. Arms Transfer Agreements Worldwide
(supplier percentage of value)

CRS-24

Chart 3. Arms Transfer Agreements With Developing Nations
(supplier percentage of value)

CRS-25
Chart 4. Arms Transfer Agreements With Developing Nations by Major Supplier, 1999-2006
(billions of constant 2006 dollars)

Russia

United States
16

16

14

14

12

12

10

10

8

8

6

6

4

4

2

2

0

0
1999 2000 2001 2002 2003 2004 2005 2006

1999 2000 2001 2002 2003 2004 2005 2006

Major West European

All Others

16

16

14

14

12

12

10

10

8

8

6

6

4

4

2

2

0

0
1999 2000 2001 2002 2003 2004 2005 2006

Source: U.S. Government

1999 2000 2001 2002 2003 2004 2005 2006

CRS-26

Figure 1. Worldwide Arms Transfer Agreements, 1999-2006 and
Suppliers’ Share with Developing World
(in millions of constant 2006 U.S. dollars)
Supplier
United States
Russia
France
United Kingdom
China
Germany
Italy
All Other European
All Others
TOTAL

Worldwide Agreements
Value 1999-2002
63,401
27,324
12,953
4,065
6,153
8,911
2,839
20,095
11,002
156,743

Percentage of Total with
Developing World
71.60
93.00
42.50
61.70
88.00
38.20
29.80
46.60
67.00
67.10

Supplier
United States
Russia
France
United Kingdom
China
Germany
Italy
All Other European
All Others
TOTAL

Worldwide Agreements
Value 2003-2006
60,143
26,991
13,962
13,563
4,708
7,162
3,667
20,555
9,272
160,023

Percentage of Total with
Developing World
56.70
95.40
65.40
77.70
100.00
38.30
49.00
43.90
79.50
65.70

Supplier
United States
Russia
France
United Kingdom
China
Germany
Italy
All Other European
All Others
TOTAL

Worldwide Agreements
Value 2006
16,905
8,700
500
3,100
800
1,900
900
5,200
2,300
40,305

Percentage of Total with
Developing World
61.00
93.10
60.00
100.00
100.00
94.70
33.30
40.40
87.00
71.50

Source: U.S. Government

CRS-27
!

The four major West European suppliers, as a group (France, United
Kingdom, Germany, Italy), registered a decline in their collective
share of all arms transfer agreements with developing nations
between 2005 and 2006. This group’s share fell from 34.4% in 2005
to 19.1% in 2006. The collective value of this group’s arms transfer
agreements with developing nations in 2006 was $5.5 billion
compared with a total of $10.9 billion in 2005 (Tables 1A and
1B)(Charts 3 and 4).

!

The United Kingdom was the European leader in arms transfer
agreements with developing nations in 2006, its share rising from
9.2% in 2005 to 10.8% in 2006. The value of its agreements with
developing nations increased from $2.8 billion in 2005 to $3.1
billion in 2006 (Tables 1A and 1B).

!

In 2006, the United States ranked first in arms transfer agreements
with developing nations at $10.3 billion. Russia ranked second at
$8.1 billion. The United Kingdom ranked third with $3.1 billion
(Charts 3 and 4)(Tables 1A, 1B and 1G).

Regional Arms Transfer Agreements, 1999-2006
Table 1C gives the values of arms transfer agreements between suppliers and
individual regions of the developing world for the periods 1999-2002 and 2003-2006.
These values are expressed in current U.S. dollars.11 Table 1D, derived from Table
1C, gives the percentage distribution of each supplier’s agreement values within the
regions for the two time periods. Table 1E, also derived from Table 1C, illustrates
what percentage share of each developing world region’s total arms transfer
agreements was held by specific suppliers during the years 1999-2002 and 20032006. Among the facts reflected in these tables are the following:
Near East.

11

!

The Near East has generally been the largest arms market in the
developing world. However, in 1999-2002, it accounted for 36.5%
of the total value of all developing nations arms transfer agreements
($29.7 billion in current dollars), ranking it second behind Asia
which was first with 47.6% of these agreements. But, during 20032006, the Near East region accounted for 46.6% of all such
agreements ($46.7 billion in current dollars), placing it first again in
arms agreements with the developing world. The Asia region ranked
second in 2003-2006 with $38.8 billion in agreements or 38.7%
(Tables 1C and 1D).

!

The United States dominated arms transfer agreements with the Near
East during the 1999-2002 period with 68.4% of their total value

Because these regional data are composed of four-year aggregate dollar totals, they are
expressed in current dollar terms.

CRS-28
($20.3 billion in current dollars). Russia was second during these
years with 8.1% ($2.4 billion). Recently, from 2003-2006, the
United States accounted for 48.9% of the value of arms agreements
with this region ($22.8 billion), while the United Kingdom
accounted for 16.5% of the value of the region’s agreements ($7.7)
billion. Russia accounted for 13.7% of the value of the region’s
arms agreements from 2003-2006 ($6.4 billion)(Chart 5)(Tables 1C
and 1E).
!

For the period 1999-2002, the United States maintained 64.3% of
the value of its developing world arms transfer agreements with the
Near East. In 2003-2006, the U.S. had 70.4% of the value of its
agreements with this region (Table 1D).

!

For the period 1999-2002, the four major West European suppliers
collectively made 16.8% of the value of their developing world arms
transfer agreements with the Near East. In 2003-2006, the major
West Europeans made 55% of their arms agreements with the Near
East (Table 1D).

!

For the period 1999-2002, France concluded 17.4% of the value of
its developing world arms transfer agreements with the Near East.
In 2003-2006, France made 31.4% of its agreements with the Near
East (Table 1D).

!

For the period 1999-2002, the United Kingdom concluded 35% of
the value of its developing world arms transfer agreements with the
Near East. In 2003-2006, the United Kingdom made 76.2% of its
agreements with the Near East (Table 1D).

!

For the period 1999-2002, China concluded 20% of the value of its
developing world arms transfer agreements with the Near East. In
2003-2006, China made 28.9% of its agreements with the Near East
(Table 1D).

!

For the period 1999-2002, Russia concluded 11.2% of the value of
its developing world arms transfer agreements with the Near East.
In 2003-2006, Russia made 26% of its agreements with the Near
East (Table 1D).

!

In the earlier period (1999-2002), by value, the United States ranked
first in arms transfer agreements with the Near East with 68.4%.
Russia ranked second with 8.1%. The major West European
suppliers, as a group, made 5.7% of this region’s agreements in
1999-2002. In the later period (2003-2006), by value, the United
States again ranked first in Near East agreements with 48.9%. The
United Kingdom ranked second with 16.5%. Russia ranked third
with 13.7%. The major West European suppliers, as a group, made
27.2% of this region’s agreements in 2003-2006 (Table 1E)(Chart
5).

CRS-29
Asia.
!

Asia has traditionally been the second largest developing world arms
market. In 2003-2006, Asia ranked second, with 38.7% of the total
value of all arms transfer agreements with developing nations ($38.8
billion in current dollars). In the earlier period, 1999-2002, the
region accounted for 47.6% of all such agreements ($38.8 billion in
current dollars), ranking first (Tables 1C and 1D).

CRS-30

Chart 5. Arms Transfer Agreements With
Near East
(supplier percentage of value)

CRS-31

Chart 6. Arms Transfer Agreements With Developing Nations in Asia
(supplier percentage of value)
(excludes Japan, Australia, and New Zealand)

CRS-32
!

In the earlier period (1999-2002), Russia ranked first in the value of
arms transfer agreements with Asia with 45.4% ($17.6 billion). The
United States ranked second with 24.4% ($9.5 billion). The major
West European suppliers, as a group, made 12.6% of this region’s
agreements in 1999-2002. In the later period (2003-2006), Russia
ranked first in Asian agreements with 37.1% ($14.4 billion),
primarily due to major combat aircraft and naval craft sales to India
and China. The United States ranked second with 18.6% ($7.2
billion). The major West European suppliers, as a group, made
19.3% of this region’s agreements in 2003-2006 (Chart 6)(Table
1E).

Latin America.
!

In the earlier period, 1999-2002, the United States ranked first in
arms transfer agreements with Latin America with 50.3%. Russia
and Germany tied for second with 5.8% each. The major West
European suppliers, as a group, made 8.8% of this region’s
agreements in 1999-2002. In the later period, 2003-2006, Russia
ranked first with 30.6%. The United States ranked second with
19.8%. Germany ranked third with 9%. All other non-major
European suppliers collectively made 24.3% of the region’s
agreements in 2003-2006. Latin America registered a substantial
increase in the total value of its arms transfer agreements from 19992002 to 2003-2006 rising from $3.4 billion in the earlier period to
$11.1 billion in the later, trebling the value of their arms agreements,
led by major sales by Russia to Venezuela (Tables 1C and 1E).

Africa.
!

In the earlier period, 1999-2002, Germany ranked first in agreements
with Africa with 16.7% ($1.6 billion). Russia was second with
12.5% ($1.2 billion). China was third with 8.3%. The non-major
European suppliers, as a group, made 35.4% of the region’s
agreements in 1999-2002. The four major West European suppliers
collectively made 33.4%. The United States made 1%. In the later
period, 2003-2006, France and China were tied for first in
agreements with 25.1% each ($900 million each). Russia was
second with 11.1% ($400 million). The major West European
suppliers, as a group, made 30.7% of this region’s agreements in
2003-2006 ($1.1 billion). All other European suppliers collectively
made 13.9% ($500 million). The United States made 5.2% ($186
million). Africa registered a substantial decline in the total value of
its arms transfer agreements from 1999-2002 to 2003-2006, falling
from $9.6 billion in the earlier period to about $3.6 billion in the
later period. This decline is attributable to the completion of large
arms orders of South Africa during 1999-2002, as part of its defense
modernization program (Tables 1C and 1E).

CRS-33

Arms Transfer Agreements With Developing Nations,
1999-2006: Leading Suppliers Compared
Table 1F gives the values of arms transfer agreements with the developing
nations from 1999-2006 by the top eleven suppliers. The table ranks these suppliers
on the basis of the total current dollar values of their respective agreements with the
developing world for each of three periods — 1999-2002, 2003-2006, and 19992006. Among the facts reflected in this table are the following:
!

The United States ranked first among all suppliers to developing
nations in the value of arms transfer agreements from 2003-2006
($32.4 billion), and first for the entire period from 1999-2006 ($70.8
billion).

!

Russia ranked second among all suppliers to developing nations in
the value of arms transfer agreements from 2003-2006 ($24.6
billion), and second from 1999-2006 ($46.1 billion).

!

The United Kingdom ranked third among all suppliers to developing
nations in the value of arms transfer agreements from 2003-2006
($10.1 billion), and fourth from 1999-2006 ($12.2 billion).

!

France ranked fourth among all suppliers to developing nations in
the value of arms transfer agreements from 2003-2006 ($8.7 billion),
and third from 1999-2006 ($13.3 billion).

!

China ranked fifth among all suppliers to developing nations in the
value of arms transfer agreements from 2003-2006 ($4.5 million),
and fifth from 1999-2006 ($9 billion).

Arms Transfer Agreements With Developing Nations in 2006:
Leading Suppliers Compared
Table 1G ranks and gives for 2006 the values of arms transfer agreements with
developing nations of the top eleven suppliers in current U.S. dollars. Among the
facts reflected in this table are the following:
!

The United States, Russia, and the United Kingdom, the top three
arms suppliers—ranked by the value of their arms transfer
agreements—in 2006 collectively made agreements valued at nearly
$21.5 billion, 74.7% of all arms transfer agreements made with
developing nations by all suppliers in that year ($28.8 billion).

!

In 2006, the United States ranked first in arms transfer agreements
with developing nations, making $10.3 billion in such agreements,
or 35.8% of them.

CRS-34
!

Russia ranked second and the United Kingdom third in arms transfer
agreements with developing nations in 2006, making $8.1 billion
and $3.1 billion in such agreements respectively.

!

Germany ranked fourth in arms transfer agreements with developing
nations in 2006, making $1.8 billion in such agreements, while Israel
ranked fifth with $1.3 billion.

Arms Transfer Agreements With Near East 1999-2006:
Suppliers and Recipients
Table 1H gives the values of arms transfer agreements with the Near East
nations by suppliers or categories of suppliers for the periods 1999-2002 and 20032006. These values are expressed in current U.S. dollars. They are a subset of the
data contained in Table 1 and Table 1C. Among the facts reflected by this table are
the following:
!

For the most recent period, 2003-2006, the principal purchasers of
U.S. arms in the Near East region, based on the value of agreements
were: Saudi Arabia ($4.5 billion), Egypt ($4.3 billion), and Israel ($3
billion). The principal purchasers of Russian arms were: Algeria
($2.3 billion), Iran ($1.5 billion), Syria ($700 million), Egypt and
Yemen ($500 million each). The principal purchasers of arms from
China were Egypt and Iran ($400 million each), and Saudi Arabia
($200 million). The principal purchasers of arms from the four
major West European suppliers, as a group, were: Saudi Arabia
($7.6 billion); the U.A.E. ($2 billion), and Oman ($1 billion). The
principal purchasers of arms from all other European suppliers
collectively were Iraq ($500 million) Egypt ($400 million), and
Jordan ($300 million). The principal purchasers of arms from all
other suppliers combined were Syria ($500 million), Iraq and the
U.A.E. ($300 million each).

!

For the period from 2003-2006, Saudi Arabia made $12.4 billion in
arms transfer agreements. Its major suppliers were the four major
West European suppliers collectively ($7.6 billion), and the United
States ($4.5 billion). Egypt made $5.7 billion in arms transfer
agreements. Its principal supplier was the United States ($4.3
billion). Israel made $4.2 billion in arms agreements. Its principal
supplier was the United States ($3 billion). The U.A.E. made $3.7
billion in arms transfer agreements. Its principal suppliers were: the
four major West European suppliers collectively ($2 billion) and the
United States ($1.2 billion).

!

The total value of arms transfer agreements by Russia with Iran
increased substantially from $100 million in 1999-2002 to $1.5
billion in 2003-2006. The value of China’s arms transfer
agreements with Iran rose from $100 million in 1999-2002 to $400
million in the 2003-2006 period.

CRS-35
!

The value of arms transfer agreements by the United States with
Saudi Arabia rose notably from the 1999-2002 period to the 20032006 period, rising from $2.7 billion in the earlier period to $4.5
billion in the later period. Saudi Arabia made 36.3% of all its arms
transfer agreements with the United States during 2003-2006.
Meanwhile, arms transfer agreements by the United Arab Emirates
(U.A.E.) with all suppliers collectively decreased by a significant
degree from 1999-2002 to 2003-2006, falling from $8.8 billion to
$3.7 billion.

Arms Transfers to Developing Nations,
Agreements With Leading Recipients

1999-2006:

Table 1I gives the values of arms transfer agreements made by the top ten
recipients of arms in the developing world from 1999-2006 with all suppliers
collectively. The table ranks recipients on the basis of the total current dollar values
of their respective agreements with all suppliers for each of three periods—19992002, 2003-2006, and 1999-2006. Among the facts reflected in this table are the
following:
!

India was the leading developing world arms purchaser from 19992006, making arms transfer agreements totaling $22.4 billion during
these years (in current dollars). In the earlier 1999-2002 period,
China ranked first in arms transfer agreements at $11 billion (in
current dollars). In 2003-2006, India ranked first in arms transfer
agreements, with a substantial increase to $14.9 billion from $7.5
billion in the earlier period (in current dollars). This increase
reflects the continuation of a military modernization effort of India,
beginning in the 1990s, and based primarily on major arms
agreements with Russia. The total value of all arms transfer
agreements with developing nations from 1999-2006 was $188.9
billion in current dollars. Thus India alone accounted for 11.9% of
all developing world arms transfer agreements during these eight
years. In the most recent period, 2003-2006, India made $14.9
billion in arms transfer agreements (in current dollars). This total
constituted 14.8% of all arm transfer agreements with developing
nations during 2003-2006, which totaled $100.3 billion. Saudi
Arabia ranked second in arms transfer agreements during 2003-2006
with $12.4 billion (in current dollars), or 12.4% of the value of all
developing world arms transfer agreements (Tables 1, 1H, 1I, and
1J).

!

During 1999-2002, the top ten recipients collectively accounted for
69.8% of all developing world arms transfer agreements. During
2003-2006, the top ten recipients collectively accounted for 64.4%
of all such agreements (Tables 1 and 1I).

CRS-36

Arms Transfers to Developing Nations in 2006: Agreements
With Leading Recipients
Table 1J names the top ten developing world recipients of arms transfer
agreements in 2006. The table ranks these recipients on the basis of the total current
dollar values of their respective agreements with all suppliers in 2006. Among the
facts reflected in this table are the following:
!

Pakistan ranked first among all developing nations recipients in the
value of arms transfer agreements in 2006, concluding $5.1 billion
in such agreements. India ranked second with $3.5 billion. Saudi
Arabia ranked third with $3.2 billion.

!

Four of the top ten developing world recipients of arms transfer
agreements in 2006 were in the Near East. Four were in Asia. Two
were in Latin America.

!

Arms transfer agreements with the top ten developing world
recipients, as a group, in 2006 totaled $22.2 billion or 77.1% of all
such agreements with the developing world,. These percentages
reflect the continuing concentration of arms purchases by developing
world states in a few such states (Tables 1 and 1J).

Developing Nations Arms Delivery Values
Table 2 shows the annual current dollar values of arms deliveries (items
actually transferred) to developing nations by major suppliers from 1999-2006. The
utility of these particular data is that they reflect transfers that have occurred. They
provide the data from which Tables 2A (constant dollars) and Table 2B (supplier
percentages) are derived. Some of the facts illustrated by these data are summarized
below.
!

In 2006 the value of all arms deliveries to developing nations ($19.9
billion) was a decrease in deliveries values from the previous year,
($20.3 billion), and the lowest annual deliveries total for the entire
period from 1999-2006 (Charts 7 and 8)(Table 2A).

!

The U.S. share of all deliveries to developing nations in 2006 was
40.2%, a decrease from 42.3% in 2005. In 2006, the United States,
for the eighth year in a row, ranked first in the value of arms
deliveries to developing nations (nearly $8 billion). The second
leading supplier in 2006 was Russia at $5.5 billion. Russia’s share
of all deliveries to developing nations in 2006 was 27.7%, an
increase from 14.8% in 2005. The United Kingdom, the third
leading supplier in 2006, made $3.3 billion in deliveries. The
United Kingdom’s share of all arms deliveries to developing nations
in 2006 was 16.6%, up from 13.8% in 2005. The share of major
West European suppliers’ deliveries to developing nations in 2006
was 21.6%, down from 25.6% in 2005 (Tables 2A and 2B).

CRS-37
!

The total value of all arms deliveries by all suppliers to developing
nations from 2003-2006 ($88.5 billion in constant 2006 dollars) was
significantly lower than the value of arms deliveries by all suppliers
to developing nations from 1999-2002 ($103.8 billion in constant
2006 dollars)(Table 2A).

!

During the years 1999-2006, arms deliveries to developing nations
comprised 72.4% of all arms deliveries worldwide. In 2006, the
percentage of arms deliveries to developing nations was 73.6% of all
arms deliveries worldwide (Tables 2A and 9A)(Figure 2).

CRS-38

Chart 7. Arms Deliveries Worldwide 1999-2006
Developed and Developing Worlds Compared
In billions of constant
2006 dollars
50
Developed World
Developing World

45
40
35
30
25
20
15
10
5
0
1999

2000

Source: U.S. Government

2001

2002

2003

2004

2005

2006

CRS-39
Chart 8. Arms Deliveries to Developing Countries by Major Supplier, 1999-2006
(in billions of constant 2006 dollars)

United States

Russia

16

16

14

14

12

12

10

10

8

8

6

6

4

4

2

2

0

0
1999 2000 2001 2002 2003 2004 2005 2006

1999 2000 2001 2002 2003 2004 2005 2006

Major West European

All Others

16

16

14

14

12

12

10

10

8

8

6

6

4

4

2

2

0

0
1999 2000 2001 2002 2003 2004 2005 2006

Source: U.S. Government

1999 2000 2001 2002 2003 2004 2005 2006

CRS-40

Figure 2. Worldwide Arms Deliveries, 1999-2006 and Suppliers’
Share with Developing World
(in millions of constant 2006 U.S. dollars)
Supplier
United States
Russia
France
United Kingdom
China
Germany
Italy
All Other European
All Others
TOTAL

Supplier
United States
Russia
France
United Kingdom
China
Germany
Italy
All Other European
All Others
TOTAL
Supplier
United States
Russia
France
United Kingdom
China
Germany
Italy
All Other European
All Others
TOTAL
Source: U.S. Government

Worldwide Deliveries
Value
1999-2002
57,640
19,041
11,744
21,813
3,767
5,969
2,254
14,217
8,377
144,822
Worldwide Deliveries
Value
2003-2006
50,032
19,713
11,053
14,103
3,381
5,780
1,071
9,219
6,303
120,655
Worldwide Deliveries
Value 2006
14,008
5,800
400
3,300
700
1,000
100
1,200
500
27,008

Percentage of Total to
Developing World
65.60
89.30
74.80
85.50
84.30
32.20
53.10
67.60
67.30
71.70
Percentage of Total to
Developing World
61.70
95.80
90.30
91.50
96.80
47.70
30.20
49.60
77.70
73.30
Percentage of Total to
Developing World
57.00
94.80
50.00
100.00
100.00
80.00
0.00
75.00
100.00
73.60

CRS-41

Regional Arms Delivery Values, 1999-2006
Table 2C gives the values of arms deliveries by suppliers to individual regions
of the developing world for the periods 1999-2002 and 2003-2006. These values are
expressed in current U.S. dollars.12 Table 2D, derived from Table 2C, gives the
percentage distribution of each supplier’s deliveries values within the regions for the
two time periods. Table 2E, also derived from Table 2C, illustrates what percentage
share of each developing world region’s total arms delivery values was held by
specific suppliers during the years 1999-2002 and 2003-2006. Among the facts
reflected in these tables are the following:
Near East.

12

!

The Near East has generally led in the value of arms deliveries
received by the developing world. In 1999-2002, it accounted for
55.1% of the total value of all developing nations deliveries (nearly
$48 billion in current dollars). During 2003-2006 the region
accounted for 53.7% of all such deliveries ($44.9 billion in current
dollars) (Tables 2C and 2D).

!

For the period 1999-2002, the United States made 60.5% of its
developing world arms deliveries to the Near East region. In 20032006, the United States made 65.8% of its developing world arms
deliveries to the Near East region (Table 2D).

!

For the period 1999-2002, the United Kingdom made 87.9% of its
developing world arms deliveries to the Near East region. In 20032006, the United Kingdom made 95.9% of its developing world
arms deliveries to the Near East region (Table 2D).

!

For the period 1999-2002, 73% of France’s arms deliveries to the
developing world were to the Near East region. In the more recent
period, 2003-2006, 83% of France’s developing world deliveries
were to nations of the Near East region (Table 2D).

!

For the period 1999-2002, Russia made 13.3% of its developing
world arms deliveries to the Near East region. In 2003-2006, Russia
made 12.3% of such deliveries to the Near East (Table 2D).

!

In the earlier period, 1999-2002, the United States ranked first in the
value of arms deliveries to the Near East with 40% ($19.2 billion).
The United Kingdom ranked second with 28.8% ($13.8 billion).
France ranked third with 11.3% ($5.4 billion). The major West
European suppliers, as a group, held 42.3% of this region’s delivery
values in 1999-2002. In the later period (2003-2006), the United
States ranked first in Near East delivery values with 43% ($19.3

Because these regional data are composed of four-year aggregate dollar totals, they are
expressed in current dollar terms.

CRS-42
billion). The United Kingdom ranked second with 25.8% ($11.6
billion). France ranked third with 17.4% ($7.8 billion). The major
West European suppliers, as a group, held 43.9% of this region’s
delivery values in 2003-2006 (Tables 2C and 2E).
Asia.
!

The Asia region has historically ranked second in the value of arms
deliveries. In the earlier period, 1999-2002, 37.4% of all arms
deliveries to developing nations were to those in Asia ($32.6
billion). In the later period, 2003-2006, Asia accounted for 36.2%
of such arms deliveries ($30.3 billion). For the period 2003-2006,
Russia made 79.3% of its developing world arms deliveries to Asia.
Germany made 53.9% of its developing world arms deliveries to
Asia. China made 50% of its developing world deliveries to Asia,
while the United States made nearly 28% (Tables 2C and 2D).

!

In the period from 1999-2002, Russia ranked first in the value of
arms deliveries to Asia with 35.3% ($11.5 billion). The United
States ranked second with 34.7% ($11.3 billion in current dollars).
The United Kingdom ranked third with 5.8% ($1.9 billion in current
dollars). The major West European suppliers, as a group, held 14.1%
of this region’s delivery values in 1999-2002 ($4.6 billion). In the
period from 2003-2006, Russia ranked first in Asian delivery values
with 46.8% ($14.2 billion). The United States ranked second with
27.1% ($8.2 billion) (Tables 2C and 2E).

Latin America.
!

In the earlier period, 1999-2002, the value of all arms deliveries to
Latin America was $2.7 billion. The United States ranked first in
the value of arms deliveries to Latin America with 41.8% ($1.1
billion). France and Italy tied for second with 7.3% ($300 million
each). The major West European suppliers, as a group, held 18.2%
of this region’s delivery values in 1999-2002. The other non-major
European suppliers collectively held 29.1%. In the later period,
2003-2006, the United States ranked first in Latin American delivery
values with 32.4% ($1.7 billion). Russia was second with 17.4%
($900 million). The major West European suppliers, as a group,
held 13.5% of this region’s delivery values in 2003-2006. All other
non-European suppliers combined held 17.4% ($900 million), as did
all other non-major European suppliers collectively ($900 million).
During 2003-2006, the value of all arms deliveries to Latin America
was $5.2 billion, a substantial increase over the $2.7 billion
deliveries total for 1999-2002 (Tables 2C and 2E).

Africa.
!

In the earlier period, 1999-2002, the value of all arms deliveries to
Africa was nearly $3.8 billion. Russia ranked first in the value of

CRS-43
arms deliveries to Africa with 21.1% ($800 million). China ranked
second with 13.2% ($500 million). The non-major West European
suppliers, as a group, held 37% of this region’s delivery values in
1999-2002 ($1.4 billion). The United States held 2.3%. In the later
period, 2003-2006, Germany ranked first in African delivery values
with 27.7% ($900 million). Russia ranked second with 18.4%
($600 million). China ranked third with 15.4% ($500 million). The
United States held 4.7% in this later period. The major West
European suppliers collectively held 40% ($1.3 billion). All other
European suppliers collectively held 12.3% ($400 million). During
the 2003-2006 period, the value of all arms deliveries to Africa
decreased from $3.8 billion in 1999-2002 to $3.3 billion (Tables 2C
and 2E).

Arms Deliveries to Developing Nations, 1999-2006: Leading
Suppliers Compared
Table 2F gives the values of arms deliveries to developing nations from 19992006 by the top eleven suppliers. The table ranks these suppliers on the basis of the
total current dollar values of their respective deliveries to the developing world for
each of three periods — 1999-2002, 2003-2006, and 1999-2006. Among the facts
reflected in this table are the following:
!

The United States ranked first among all suppliers to developing
nations in the value of arms deliveries from 2003-2006 ($29.4
billion), and first for the entire period from 1999-2006 ($61.1
billion).

!

Russia ranked second among all suppliers to developing nations in
the value of arms deliveries from 2003-2006 ($17.9 billion), and
second for the entire period from 1999-2003 ($32.3 billion).

!

The United Kingdom ranked third among all suppliers to developing
nations in the value of arms deliveries from 2003-2006 ($12.2
billion), and third for the entire period from 1999-2006 ($27.9
billion).

Arms Deliveries With Developing Nations in 2006: Leading
Suppliers Compared
Table 2G ranks and gives for 2006 the values of arms deliveries to developing
nations of the top ten suppliers in current U.S. dollars. Among the facts reflected in
this table are the following:
!

The United States, Russia, and the United Kingdom—2006’s top
three arms suppliers to the developing world—ranked by the value
of their arms deliveries—collectively made deliveries in 2006 valued

CRS-44
at nearly $16.8 billion, 84.4% of all arms deliveries made to
developing nations by all suppliers.
!

In 2006, the United States ranked first in the value of arms deliveries
to developing nations, making about $8 billion in such deliveries, or
40.2% of them.

!

Russia ranked second and the United Kingdom third in deliveries to
developing nations in 2006, making $5.5 billion and $3.3 billion in
such deliveries respectively.

!

Germany ranked fourth in arms deliveries to developing nations in
2006, making $800 million in such deliveries, while China ranked
fifth with $700 million in deliveries.

Arms Deliveries to Near East, 1999-2006: Suppliers and
Recipients
Table 2H gives the values of arms delivered to Near East nations by suppliers
or categories of suppliers for the periods 1999-2002 and 2003-2006. These values
are expressed in current U.S. dollars. They are a subset of the data contained in
Table 2 and Table 2C. Among the facts reflected by this table are the following:
!

For the most recent period, 2003-2006, the principal arms recipients
of the United States in the Near East region, based on the value of
their arms deliveries were Israel ($5.2 billion) Egypt ($5.1 billion),
Saudi Arabia ($4.4 billion), and Kuwait ($900 million). The
principal arms recipients of Russia were Algeria ($500), Yemen
($400 million), Iran and Syria ($300 million each). The principal
arms recipients of China were Egypt ($300 million) Iran and Kuwait
($200 million each). The principal arms recipients of the four major
West European suppliers, as a group, were Saudi Arabia ($13.5
billion) and the U.A.E. ($5.4 billion). The principal arms recipient
of all other European suppliers collectively was Saudi Arabia ($700
million). The principal arms recipients of all other suppliers, as a
group, were Iraq, Syria, and the U.A.E. ($200 million each).

!

For the period 2003-2006, Saudi Arabia received $18.7 billion in
arms deliveries. Its principal suppliers were the four major West
Europeans, as a group ($13.5 billion), and the United States ($4.4
billion). The U.A.E. received $6.6 billion in arms deliveries. Its
principal suppliers were the four major West Europeans, as a group
($5.4 billion), and the United States ($600 million). Egypt received
$5.8 billion in arms deliveries. Its principal supplier was the United
States ($5.1 billion). Israel received $5.4 billion in arms deliveries.
Its principal supplier was the United States ($5.2 billion). Kuwait
received $1.1 billion in arms deliveries. Its principal supplier was
the United States ($900 million). Oman received $900 million in
arms deliveries. Its principal suppliers were the United States ($600

CRS-45
million), and the four major European suppliers collectively ($300
million).
!

Iran received $700 million in arms deliveries. Russia and China
were its principal suppliers, delivering $300 million and $200
million respectively.

!

The value of United States arms deliveries to Saudi Arabia declined
from $8.9 billion in 1999-2002 to $4.4 billion in 2003-2006, as
implementation of major orders placed during the Persian Gulf war
era were essentially concluded.

!

The value of Russian arms deliveries to Iran declined from the 19992002 period to the 2003-2006 period. Russian arms deliveries fell
from $400 million to $300 million.

Arms Deliveries to Developing Nations, 1999-2006: The
Leading Recipients
Table 2I gives the values of arms deliveries made to the top ten recipients of
arms in the developing world from 1999-2006 by all suppliers collectively. The table
ranks recipients on the basis of the total current dollar values of their respective
deliveries from all suppliers for each of three periods — 1999-2002, 2003-2006, and
1999-2006. Among the facts reflected in this table are the following:
!

Saudi Arabia and China were the top two developing world
recipients of arms from 1999-2006, receiving deliveries valued at
$45.8 billion and $17.1 billion, respectively, during these years. The
total value of all arms deliveries to developing nations from 19992006 was $171 billion in current dollars (see Table 2). Thus, Saudi
Arabia and China accounted for 26.8% and 10%, respectively, of all
developing world deliveries during these eight years—together
36.8% of the total. In the most recent period—2003-2006—Saudi
Arabia and China ranked first and second in the value of arms
received by developing nations ($18.7 billion and $8.9 billion,
respectively, in current dollars). Together, Saudi Arabia and China
accounted for 33% of all developing world arms deliveries ($27.6
billion out of $83.7 billion—the value of all deliveries to developing
nations in 2003-2006 (in current dollars).

!

For the 2003-2006 period, Saudi Arabia alone received $18.7 billion
in arms deliveries (in current dollars), or 22.4% of all deliveries to
developing nations during this period.

!

During 1999-2002, the top ten recipients collectively accounted for
76.8% of all developing world arms deliveries. During 2003-2006,
the top ten recipients collectively accounted for 75.4% of all such
deliveries (Tables 2 and 2I).

CRS-46

Arms Transfers to Developing Nations in 2006: Agreements
With Leading Recipients
Table 2J names the top ten developing world recipients of arms transfer
agreements in 2006. The table ranks these recipients on the basis of the total current
dollar values of their respective agreements with all suppliers in 2006. Among the
facts reflected in this table are the following:
!

Saudi Arabia was the leading recipient of arms deliveries in 2006
among developing nations, receiving $4.1 billion in such deliveries.
China ranked second with $2.9 billion. Israel ranked third with $1.5
billion (Tables 2 and 2J).

!

Arms deliveries in 2006 to the top ten developing nation recipients,
collectively, constituted $14.3 billion, or 71.9% of all developing
nations deliveries. Five of the top ten arms recipients in the
developing world in 2006 were in the Asia region; three were in the
Near East region; two were in the Latin America region (Tables 2
and 2J).

CRS-47

Table 1. Arms Transfer Agreements With Developing Nations, by Supplier, 1999-2006
(in millions of current U.S. dollars)
1999

2000

2001

2002

2003

2004

2005

2006

1999-2006

United States

8,695

12,630

7,638

9,362

6,900

8,992

6,239

10,306

70,762

Russia

4,200

6,600

5,400

5,300

4,400

5,200

6,900

8,100

46,100

France

1,100

2,200

900

400

900

1,100

6,400

300

13,300

United Kingdom

1,200

0

200

700

100

4,100

2,800

3,100

12,200

China

2,300

600

1,200

400

500

700

2,500

800

9,000

Germany

1,600

1,000

100

100

0

100

800

1,800

5,500

Italy

400

100

200

0

300

600

500

300

2,400

All Other European

4,000

1,300

1,100

1,400

1,300

2,200

3,000

2,100

16,400

All Others

1,700

1,900

1,600

1,000

1,200

2,400

1,400

2,000

13,200

TOTAL

25,195

26,330

18,338

18,662

15,600

25,392

30,539

28,806

188,862

Source: U.S. Government
Note: Developing nations category excludes the U.S., Europe, Canada, Japan, Australia and New Zealand. All data are for the calendar year given except for U. S. MAP (Military
Assistance Program), IMET (International Military Education and Training), and Excess Defense Article data which are included for the particular fiscal year. All amounts given include
the values of all categories of weapons, spare parts, construction, all associated services, military assistance, excess defense articles, and training programs. Statistics for foreign countries
are based upon estimated selling prices. All foreign data are rounded to the nearest $100 million. The United States total in 2000 includes a $6.432 billion licensed commercial
agreement with the United Arab Emirates for 80 F-16 aircraft.

CRS-48

Table 1A. Arms Transfer Agreements with Developing Nations, by Supplier, 1999-2006
(in millions of constant 2006 U.S. dollars)
1999

2000

2001

2002

2003

2004

2005

2006

TOTAL
1999-2006

United States

10,739

15,158

8,891

10,619

7,658

9,673

6,489

10,306

79,533

Russia

5,187

7,921

6,286

6,012

4,883

5,594

7,176

8,100

51,159

France

1,359

2,640

1,048

454

999

1,183

6,656

300

14,639

United Kingdom

1,482

0

233

794

111

4,410

2,912

3,100

13,042

China

2,841

720

1,397

454

555

753

2,600

800

10,119

Germany

1,976

1,200

116

113

0

108

832

1,800

6,146

494

120

233

0

333

645

520

300

2,645

All Other European

4,940

1,560

1,280

1,588

[Text truncated at 120,000 characters. The full text is on the page linked above.]

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/crs%3ARL34187. Public record. Not legal advice.