Germany fueling world arms race

Germany is among the world’s largest arms exporters, though estimates of the magnitude of the country’s arms sales and of its ranking among arms traders differ. According to the Stockholm International Peace Research Institute (SIPRI), Germany was the fifth largest exporter of major conventional weapons in 2011 behind the US, Russia, France and China.
The US Congressional Research Service (CRS) on the other hand ranks the country as the sixth largest arms exporter. The CRS estimates the financial value of German arms deliveries in 2011 at $ 1.6 billion or approximately 4 percent of global arms exports. This ranked Germany behind the US, Russia, the UK, France and Italy.
The CRS annual report Conventional Arms Transfers to Developing Nations 2004-2011 aims to assist the US Congress “in its oversight role of assessing how the current nature of the international weapons trade might affect US national interests.” The report provides the estimated financial value of arms export agreements and deliveries from the largest arms exporters to all regions of the world in constant and current US dollars for the previous eight calendar years.
The CRS report covers transfers to governments of “all categories of weapons and ammunition, military spare parts, military construction, military assistance and training programs, and all associated services.” This definition is much broader than SIPRI’s, according to the organization’s latest fact sheet titled Measuring international arms transfers.
For data on US arms export agreements and deliveries, the CRS report relies on information on government-to-government Foreign Military Sales (FMS). On the sources of data for non-US countries, the CRS simply states that “Statistics for foreign countries are based upon estimated selling prices,” although it is believed that the CRS draws on classified US government sources.
The SIPRI fact sheet authors Paul Holtom, Mark Bromley and Verena Simmel are of the view that CRS figures for non-US arms exporters are often lower than official government financial values for export licenses granted and arms exports.
SIPRI has identified 34 states that have provided official data on the financial value of their “arms exports,” “licenses for arms exports” or “arms export agreements” to the public for at least 6 years in the period 2001–2010 and for which the average of the reported values exceeds $10 million. This official data can be provided either in a national report on arms exports, another type of government report, a press release or via an attributed or unattributed quote in a media report.
The SIPRI researchers say that public announcements on the financial value of states’ arms exports cannot be easily compared due to differences in the definitions of “arms” used and the fact that many states provide information only on the financial value of either proposed arms exports or completed deliveries. Information on the value of proposed arms exports and completed deliveries of arms refer to different activities, and so should not be directly compared, they add.
States use different methods for collecting and reporting information on the financial value of proposed arms exports or completed deliveries. Data on proposed arms exports can be based on the value of either arms export agreements concluded or export licenses issued, which represent two different data sets. Data on deliveries of arms can be based on data provided by the national customs authorities or company reporting on export licenses used, which again represent two different data sets.
CRS data not sufficiently detailed The CRS estimated the financial value of German arms deliveries in 2011 to be $1.6 billion or approximately 4 percent of global arms exports. This ranked Germany as the sixth largest exporter of major conventional weapons in 2011, behind the USA, Russia, the UK, France and Italy.
The SPRI fact sheet authors note that the CRS data is not sufficiently detailed to gain an understanding of which deliveries account for the stated value of German arms exports. The CRS report includes tables detailing the numbers of weapon systems delivered, but these are aggregated over 3-year periods and by weapon category and region, rather than weapon description and destination. Further, there is no separate entry for German exports.
According to the CRS, the financial value of German arms transfer agreements concluded in 2011 totaled $100 million (in current US dollars), or 0.1 percent of the global total value of arms transfer agreements, ranking Germany as the 7th largest supplier listed by CRS.
There is insufficient open source information in the SIPRI Arms Transfers Database on the financial value of arms transfer agreements concluded by Germany in 2011 to corroborate this figure. However, comparisons between CRS data on arms transfer agreements and publicly reported information on the value of signed arms export contracts in previous years indicates a tendency for CRS to underestimate the financial value of arms transfer agreements for states other than the USA.
For example, the 2007 CRS report stated that the financial value of Germany’s arms export agreements with developing countries in 2006 was $1.9 billion, based on an agreement with Brazil for licensed production of a Type ILK214 submarine and the upgrading of existing Type 209 submarines, and from an Israeli order for two Type 800 Dolphin class submarines.
However, according to available open sources, the Brazil deal was worth approximately $1.6 billion and the Israel deal was worth $1 billion. This gives a combined value of at least $2.6 billion — $700 million more than the CRS estimate — without taking into account other agreements concluded by Germany in 2006.
The German government has published a national report on military equipment exports (Rüstungsexportbericht) every year since 1999. The report provides information on (a) the financial value of export licenses granted and completed deliveries of “war weapons” (Kriegswaffen); and (b) the financial value of export licenses granted for military equipment as defined in the German national control list (i.e. which includes both war weapons and other military equipment that requires an export license).
Thus, German official data on the financial value of arms export deliveries does not include the value of the many items on the German national control list that are not categorized as war weapons. The reported financial value of German deliveries of war weapons in 2011 was € 1.3 billion ($ 1.65 billion), compared to € 2.1 billion ($ 2.8 billion) in 2010. SIPRI argues: Several major suppliers have not yet provided the financial value of their arms deliveries in 2011, and so a comparison of the German Government’s official financial value with its peers cannot be made for 2011. In 2010, in terms of the financial value of deliveries of military equipment, Germany ranked as the fourth largest arms exporter behind the USA, Russia and France.
However, in this case the German data is based solely on reporting on war weapons, which is a narrower range of items than those covered by the US, Russian and French data. In addition, such major exporters as China, Israel and the UK do not provide information on the financial value of their arms deliveries.
Precisely, against this backdrop, SIPRI goes beyond the financial value and estimates the volume of German arms exports in 2011 at 1.2 billion TIV (trend-indicator value), or 4 percent of global arms exports, down from 2.5 billion TIV in 2010 (10 percent of the world total). TIV is a unique pricing system the SIPRI has developed to measure the volume of deliveries of major conventional weapons and components.
The major recipients of German arms exports in 2011 were Brunei Darussalam (accounting for 16 percent of exports), USA (11 percent), Singapore (7 percent), Spain (7 percent) and Taiwan (6 percent). Tanks and armored vehicles represented 26 percent of the volume of German major conventional weapons exports in 2011, with ships accounting for 22 percent, engines 20 percent, and missiles 15 percent.
The TIV of an item being delivered is intended to reflect its military capability rather than its financial value. This common unit can be used to measure trends in the flow of arms between particular countries and regions over time — in effect, a military capability price index.
Therefore, SIPRI says, it is important to ensure that the pricing system remains consistent across both the weapon systems covered and over time, and that any changes introduced are backdated.
Weapons that have previously been used by another armed force (i.e. surplus weapons) are given a value equal to 40 percent of that of a new weapon. Used weapons that have been significantly refurbished or modified by the supplier before delivery are given a value of 66 percent of the value when new.
The overall volume of arms exports from a particular state in any given year is then calculated by adding together the TIVs for the weapons and components delivered. Since year-on-year deliveries can fluctuate, SIPRI uses 5-year moving averages to provide a more stable measure for trends in international arms transfers.
The SIPRI TIV neither reflects the actual price paid for weapons nor does it represent current dollar values for arms transfers. The TIV is therefore not comparable directly with gross national product, gross domestic product, military expenditure, sales values or the financial value of arms export licenses.

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