Introduction to the Arms Trade - How the arms trade works

Unquestioning government support

Every year, the UK Government authorises the sale of arms to well over 100 countries across the globe.[1] This is hardly surprising given that it is government policy to vigorously support arms exports, and that the Government allows arms companies unrivalled influence in its policy-making. In fact, arms companies and the Government have a unique relationship and are inseparable when it comes to selling arms.

Priority targets for UK arms promotion

(The UKTI Defence & Security Organisation's Priority Markets for 2010/11)

Map of the world showing priority targets for UK arms promotion

The Government’s UK Trade & Investment (UKTI) department is a vital element of the UK’s arms dealing. In 2008 it opened the Defence & Security Organisation (DSO) which promotes weaponry on behalf of arms companies. There are 158 civil servants in UKTI DSO while all other non-arms sectors have a combined total of 137 staff.[2] This is despite arms accounting for less than 1.5 per cent of UK exports.[3]

This disproportionality reflects the wider political and financial support for arms exports, with the precise level of subsidy being hard to quantify.

Preferential treatment

0.2% Arms export jobs as a percentage of total employment.[4]

1.5% Arms as a percentage of total exports.[5]

27% UK Government research expenditure spent on arms.[6]

54% UK Trade & Investment staff committed to selling arms (as a percentage of those in all identified industry sectors).[7]

The Government asserts that it is effective in “controlling” arms exports. In the UK, this regulation is led by the Department for Business, Innovation and Skills (BIS) and carried out in conjunction with the Ministry of Defence (MoD) and the Foreign and Commonwealth Office (FCO) (and sometimes the Department for International Development, though it has little say).

Companies apply for licences to export their arms. The licences are then considered and, except in exceptional circumstances, approved.

In the year for which most recent figures are available, the departments issued 10,850 arms export licences, refused 230 and revoked 14.[8] Around half of the refusals related to the proliferation of Weapons of Mass Destruction, with a maximum of 76 being refused or revoked on the grounds that they contributed to internal repression, internal conflict or regional instability.

The token nature of the controls is also evident through the wider activities of the controlling departments. The Foreign Office’s embassies, the MoD’s armed services and BIS’s UKTI and Export Credits Guarantee Department (which insures UK exporters against payment default) all actively promote and support arms sales.

While it is policy to promote arms sales, there is no prospect that the Government could meaningfully control and restrain the trade.

Notes

  1. Department for Business Innovation & Skills, Strategic Export Controls Country Pivot Report 2009
  2. UK Trade & Investment, UKTI Corporate Plan 2010-2011, March 2010, pp.38-39
  3. Total exports of goods and services in 2010 were £428 billion (Office for National Statistics, Exports and Imports of Goods and Services. Total arms exports (goods and services) are approximately £5 billion per year. In 2008, the Government stopped publishing the data on arms deliveries, however, figures prior to that oscillated around £5 billion (Defence Analytical Services and Advice, UK Defence Statistics 2008), and the lack of any increase since then can be seen in Richard Grimmett, Conventional Arms Transfers to Developing Nations, 2002-2009, Congressional Research Service, 10 September 2010. Using these figures, arms exports comprise 1.17% of total exports.
  4. Total UK employment in 2010 was 29.02 million (Office for National Statistics, Labour Market Statistics, April 2011, Table 3 ). UK arms export jobs are estimated to total 55,000 (ADS trade association estimate provided by UKTI DSO to CAAT, 22 December 2010). Using these figures, arms export jobs comprise 0.19% of the workforce.
  5. Total exports of goods and services in 2010 were £428 billion (Office for National Statistics, Exports and Imports of Goods and Services. Total arms exports (goods and services) are approximately £5 billion per year. In 2008, the Government stopped publishing the data on arms deliveries, however, figures prior to that oscillated around £5 billion (Defence Analytical Services and Advice, UK Defence Statistics 2008), and the lack of any increase since then can be seen in Richard Grimmett, Conventional Arms Transfers to Developing Nations, 2002-2009, Congressional Research Service, 10 September 2010. Using these figures, arms exports comprise 1.17% of total exports. 1.5% is used in the table to cover year-by-year variations in arms exports.
  6. Total Government funded R&D for 2008 was £7,949 million (Office for National Statistics, UK gross domestic expenditure on research and development, 26 March 2010). Ministry of Defence R&D expenditure for 2008 was £2,111 million (Defence Analytical Services and Advice, Defence Statistics 2010, Table 1.8, using 2007/8 and 2008/9 figures).
  7. UKTI DSO has 158 staff. Other sectors have a total of 137 staff (UK Trade & Investment, UKTI Corporate Plan 2010-2011, March 2010, pp38-39)
  8. Department for Business Innovation & Skills, Strategic Export Controls Country Annual Report 2009, July 2010
Created 2 Aug 2011
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