WASHINGTON: The world’s top 100 arms producers witnessed a 3.5% decline in revenues, totaling $597 billion in 2022 compared to the previous year, according to a report by the Stockholm International Peace Research Institute (SIPRI) released on Monday. Despite heightened demand, the drop in sales was primarily attributed to decreasing arms revenues among major US companies.
The report highlighted that the decline in revenues was driven by challenges faced by major arms producers in the United States. SIPRI pointed out that global arms revenues are anticipated to rebound in the coming years due to outstanding orders and an increase in new contracts.
The surge in demand for weapons and military equipment, fueled by the Russia-Ukraine war and geopolitical tensions, did not translate into higher revenues for companies due to impediments in boosting production capacity. Factors such as labor shortages, escalating costs, and supply chain disruptions hindered companies from meeting the demands generated by high-intensity warfare scenarios.
Lucie Beraud-Sudreau, the director of SIPRI’s Military Expenditure and Arms Production Program, noted the difficulties faced by arms companies in adjusting to the production demands of high-intensity warfare. She emphasized that newly signed contracts, especially for ammunition, are expected to contribute to higher revenues in 2023 and beyond.
World’s Top Arms Producing Companies
Among the top 100 arms producers, 42 US companies dominated with a 51% share, but their arms revenues dropped by 7.9% to $302 billion in 2022. Meanwhile, 22 companies from Asia and Oceania listed in the ranking experienced a 3.1% growth, reaching $134 billion in 2022, attributed to domestic demand and reliance on local suppliers that shielded them from supply chain disruptions.
Turkey’s four companies posted a total arms revenue of $5.5 billion in 2022, marking a 22% increase from the previous year. Notably, Turkey’s Baykar, producer of the Bayraktar TB-2 drone, entered the Top 100 for the first time after achieving a remarkable 94% growth rate in arms revenue.
China accounted for the second-largest share of combined Top 100 arms revenues by country, with 18%. The eight Chinese arms companies saw a 2.7% rise in revenues to $108 billion in 2022. Due to data limitations, only two Russian companies were included in the list, experiencing a 12% drop in combined arms revenues to $20.8 billion. The sole Ukrainian company in the Top 100, UkrOboronProm, reported a 10% decline in arms revenue to $1.3 billion.
