For other versions of this document, see http://wikileaks.org/wiki/CRS-RL34723
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                            Order Code RL34723




 Conventional Arms Transfers to
  Developing Nations, 2000-2007




                           October 23, 2008




                         Richard F. Grimmett
          Specialist in International Security
Foreign Affairs, Defense, and Trade Division
  Conventional Arms Transfers to Developing Nations,
                     2000-2007

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 (FMS)
transactions. Similar 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 2000-2007, the value of arms
transfer agreements with developing nations comprised 66.6% of all such agreements
worldwide. More recently, arms transfer agreements with developing nations
constituted 67.7% of all such agreements globally from 2004-2007, and 70.5% of
these agreements in 2007.

      The value of all arms transfer agreements with developing nations in 2007 was
nearly $42.3 billion. This was an increase from $38.1 billion in 2006. In 2007, the
value of all arms deliveries to developing nations was $17.2 billion, the lowest total
in these deliveries values for the entire 2000-2007 period (in constant 2007 dollars).

     Recently, from 2004-2007, the United States and Russia have dominated the
arms market in the developing world, with both nations either ranking first or second
for 3 out of 4 years in the value of arms transfer agreements. From 2004-2007,
Russia made nearly $39.3 billion, 27.9% of all such agreements, expressed in
constant 2007 dollars. During this same period, the United States made $34.7 billion
in such agreements, 24.6% of all such agreements. Collectively, the United States
and Russia made 52.5% of all arms transfer agreements with developing nations
during this four-year period.

     In 2007, the United States ranked first in arms transfer agreements with
developing nations with $12.2 billion or 28.8% of these agreements. The United
Kingdom was second with $9.8 billion or 23.2% of such agreements. Russia was
third with $9.7 billion or 23%. In 2007, the United States ranked first in the value
of arms deliveries to developing nations at $7.6 billion, or 44.2% of all such
deliveries. Russia ranked second at $4.6 billion or 26.7% of such deliveries.

     In 2007, Saudi Arabia ranked first in the value of arms transfer agreements
among all developing nations weapons purchasers, concluding $10.6 billion in such
agreements. India ranked second with $5 billion in such agreements. Pakistan
ranked third with $4.2 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 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
    Leading Developing Nations Arms Purchasers . . . . . . . . . . . . . . . . . . . . . . 16
    Weapons Types Recently Delivered to Near East Nations . . . . . . . . . . . . . 17
         United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
         Russia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
         China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
         Major West European Suppliers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
         All Other European Suppliers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
         All Other Suppliers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

Arms Values Data Tables and Charts for 2000-2007 . . . . . . . . . . . . . . . . . . . . . 21

Selected Weapons Deliveries toDeveloping Nations, 2000-2007 . . . . . . . . . . . . 56

Worldwide Arms Transfer Agreements and Deliveries Values,
    2000-2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
    Total Worldwide Arms Transfer Agreements Values, 2000-2007 . . . . . . . 62
    Total Worldwide Delivery Values 2000-2007 . . . . . . . . . . . . . . . . . . . . . . . 62

Description of Items Counted in Weapons Categories, 2000-2007 . . . . . . . . . . . 73

Regions Identified in Arms Transfer Tables and Charts . . . . . . . . . . . . . . . . . . . 74

List of Tables
Figure 1. Worldwide Arms Transfer Agreements, 2000-2007 and Suppliers'
     Share with Developing World
     (in millions of constant 2007 U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . 28
Figure 2. Worldwide Arms Deliveries, 2000-2007 and Suppliers'
     Share with Developing World
     (in millions of constant 2007 U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . 33
Table 1. Arms Transfer Agreements with Developing Nations, by Supplier,
     2000-2007 (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . 34
Table 1A. Arms Transfer Agreements with Developing Nations, by Supplier,
     2000-2007 (in millions of constant 2007 U.S. dollars) . . . . . . . . . . . . . . . . 35
Table 1B. Arms Transfer Agreements with Developing Nations, by Supplier,
    2000-2007 (expressed as a percent of total, by year) . . . . . . . . . . . . . . . . . . 36
Table 1C. Regional Arms Transfer Agreements, by Supplier, 2000-2007
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Table 1D. Percentage of Each Supplier's Agreements Value by Region,
    2000-2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Table 1E. Percentage of Total Agreements Value by Supplier to Regions,
    2000-2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Table 1F. Arms Transfer Agreements with Developing Nations, 2000-2007:
    Leading Suppliers Compared
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Table 1G. Arms Transfer Agreements with Developing Nations in 2007:
    Leading Suppliers Compared
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Table 1H. Arms Transfer Agreements with Near East, by Supplier
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Table 1I. Arms Transfer Agreements with Developing Nations,
    2000-2007: Agreements by the Leading Recipients
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Table 1J. Arms Transfer Agreements with Developing Nations in 2007:
    Agreements by Leading Recipients
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Table 2. Arms Deliveries to Developing Nations, by Supplier, 2000-2007
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Table 2A. Arms Deliveries to Developing Nations, by Supplier, 2000-2007
    (in millions of constant 2007 U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . 46
Table 2B. Arms Deliveries to Developing Nations, by Supplier, 2000-2007
    (expressed as a percent of total, by year) . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Table 2C. Regional Arms Deliveries by Supplier, 2000-2007
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Table 2D. Percentage of Supplier Deliveries Value by Region, 2000-2007 . . . . 49
Table 2E. Percentage of Total Deliveries Value by Supplier to Regions,
    2000-2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Table 2F. Arms Deliveries to Developing Nations, 2000-2007
    Leading Suppliers Compared
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Table 2G. Arms Deliveries to Developing Nations in 2007:
    Leading Suppliers Compared
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Table 2H. Arms Deliveries to Near East, by Supplier
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Table 2I. Arms Deliveries to Developing Nations, 2000-2007:
    The Leading Recipients
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Table 2J. Arms Deliveries to Developing Nations in 2007:
    The Leading Recipients
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Table 3. Numbers of Weapons Delivered by Suppliers
     to Developing Nations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Table 4. Number of Weapons Delivered by Suppliers
     to Asia and the Pacific . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Table 5. Numbers of Weapons Delivered by Suppliers
     to Near East . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
Table 6. Numbers of Weapons Delivered by Suppliers
     to Latin America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
Table 7. Number of Weapons Delivered by Suppliers
     to Africa . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Table 8. Arms Transfer Agreements with the World, by Supplier, 2000-2007
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Table 8A. Arms Transfer Agreements with the World, by Supplier,
    2000-2007 (in millions of constant 2007 U.S. dollars) . . . . . . . . . . . . . . . . 64
Table 8B. Arms Transfer Agreements with the World, by Supplier,
    2000-2007 (expressed as a percent of total, by year) . . . . . . . . . . . . . . . . . . 65
Table 8C. Arms Transfer Agreements with the World, 2000-2007:
    Leading Suppliers Compared
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Table 8D. Arms Transfer Agreements with the World in 2007:
    Leading Suppliers Compared
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Table 9. Arms Deliveries to the World, by Supplier, 2000-2007
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Table 9A. Arms Deliveries to the World, by Supplier, 2000-2007
    (in millions of constant 2007 U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . 69
Table 9B. Arms Deliveries to the World, by Supplier 2000-2007
    (expressed as a percent of total, by year) . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Table 9C. Arms Deliveries to the World, 2000-2007:
    Leading Suppliers Compared
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Table 9D. Arms Deliveries to the World in 2007:
    Leading Suppliers Compared
    (in millions of current U.S. dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Conventional Arms Transfers to Developing
          Nations, 2000-2007

                     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 2000 through 2007. It also includes some data on
worldwide supplier transactions. It updates and revises CRS Report RL34187,
Conventional Arms Transfers to Developing Nations, 1999-2006.

      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. Following the Cold War's end, U.S. arms transfer policy has been based
on assisting friendly and allied nations in developing and maintaining their ability to
deal with regional security threats and concerns.

     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
                                         CRS-2

a foreign policy objective, today that motivation may be based as much on economic
considerations as those of foreign or national security policy.

     The developing world continues to be the primary focus of foreign arms sales
activity by conventional weapons suppliers. During the period of this report, 2000-
2007, conventional arms transfer agreements (which represent orders for future
delivery) to developing nations comprised 66.6% of the value of all international
arms transfer agreements. The portion of agreements with developing countries
constituted 67.7% of all agreements globally from 2004-2007. In 2007, arms transfer
agreements with developing countries accounted for 70.5% of the value of all such
agreements globally. Deliveries of conventional arms to developing nations, from
2004-2007, constituted 64.7% of all international arms deliveries. In 2007, arms
deliveries to developing nations constituted 55.6% 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 2000-2007 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
to 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 2007 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 2007 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 (2000-2003 and 2004-2007). These
tables are expressed in current dollar terms. And where tables rank leading arms
suppliers to developing nations or leading developing nation recipients using four-
year 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 2007 was nearly $60 billion. This was an increase in arms
agreements values over 2006 of 9.2% (Chart 1)(Table 8A).

      In 2007, the United States led in arms transfer agreements worldwide, making
agreements valued at over $24.8 billion (41.5% of all such agreements), up
significantly from $16.7 billion in 2006. Russia ranked second with $10.4 billion in
agreements (17.3% of these agreements globally), down from $14.3 billion in 2006.
The United Kingdom ranked third, its arms transfer agreements worldwide were $9.8
billion in 2007, up from $4.1 billion in 2006. The United States, Russia, and the
United Kingdom collectively made agreements in 2007 valued at over $45 billion,
75.2% of all international arms transfer agreements made by all suppliers (Figure
1)(Tables 8A, 8B, and 8D).

     For the period 2004-2007, the total value of all international arms transfer
agreements ($208.3 billion) was substantially higher than the worldwide value during
2000-2003 ($147.6 billion), an increase of 29.2%. During the period 2000-2003,
developing world nations accounted for 67.7% of the value of all arms transfer
agreements made worldwide. During 2004-2007, developing world nations
accounted for 67.7% of all arms transfer agreements made globally. In 2007,
developing nations accounted for 70.5% of all arms transfer agreements made
worldwide (Figure 1)(Table 8A).

     In 2007, the United States ranked first in the value of all arms deliveries
worldwide, making nearly $12.8 billion in such deliveries or 41.3%. 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 2007, making $4.7 billion in such
deliveries. The United Kingdom ranked third in 2007, making $2.6 billion in such
deliveries. These top three suppliers of arms in 2007 collectively delivered nearly
$20.1 billion, 64.8% 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 2007 was $31 billion. This is
a decrease in the total value of arms deliveries from the previous year (a decline from
$33.6 billion). The total value of such arms deliveries worldwide in 2004-2007
($134.9 billion) was lower than the deliveries worldwide from 2000-2003 ($143.6
billion, a decline of nearly $10 billion) (Figure 2)(Tables 9A and 9B)(Charts 7 and
8).

     Developing nations from 2004-2007 accounted for 64.7% of the value of all
international arms deliveries. In the earlier period, 2000-2003, developing nations
accounted for 65.1% of the value of all arms deliveries worldwide. In 2007,
developing nations collectively accounted for 55.6% of the value of all international
arms deliveries (Figure 2)(Tables 2A, 9A, and 9B).
                                      CRS-5

      Worldwide weapons orders increased in 2007. The total of nearly $60 billion
was an increase from $54.9 billion in 2006, or 9.2%. Global arms agreement values
for the other years covered here ranged from $48.7 billion in 2005 to $32.6 billion
in 2003. Of the major arms orders secured in 2007 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 or
acceleration of a longer-term weapons-acquisition program.

     The increase in new weapons sales can also be explained, in part, by the
decision of some purchasing nations to acquire major systems they had deferred
buying due to budgetary considerations. Some nations were completing the
integration of major weapons systems they have already purchased into their force
structures. Some of the growth in arms transfer agreements more recently also
reflects contracts related to training and support services, as well as upgrades of
existing weapons systems. Individual orders such as these can be expensive, and in
given instances prove to be nearly as costly as orders for new units of military
equipment.

      Because the international arms market continues to be intensely competitive,
several producing countries have focused sales efforts on prospective clients in
nations and regions where individual suppliers have had competitive advantages
resulting from well-established military-support relationships. Arms sales to new
NATO member nations in Europe 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
less-developed countries.

     There are inherent limitations on these European sales due to the smaller
defense budgets of many of the purchasing countries. Yet creative seller financing
options, as well as the use of co-assembly, co-production, and counter-trade
agreements to offset costs to the buyers continue to facilitate new arms agreements.
It seems likely that the United States and European countries or consortia will
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.

      Developed nations continue their efforts to protect important elements of their
national military industrial bases by limiting arms purchases from other developed
nations. However, 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. Some supplying nations, meanwhile, have chosen to
manufacture items for niche weapons categories where their specialized production
capabilities give them important advantages in the international arms marketplace.

    Despite the recent upward trend in weapons purchases with the developed
world, some developing nations have limited their weapons purchases primarily due
                                       CRS-6

to their limited financial resources to pay for such equipment. Other prospective
arms purchasers in the developing world with significant financial assets have been
cautious 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 many oil
consuming states, contributing to their decisions to curtail or defer new weapons
acquisitions. A number of less affluent developing nations have chosen to upgrade
existing weapons systems in their inventories, while reducing their purchases of new
ones. This circumstance may curtail sales of some new weapons systems. Yet the
weapons upgrade market can be very lucrative for some arms producers, and
partially mitigate the effect of fewer opportunities for the sale of major items of
military equipment.

     Most recently, the nations in the Near East and Asia regions have resumed large
weapons purchases in contrast with arms sales activity in the earliest years of this
report. These major orders continue to be made by a select few developing nations
in these regions. They have been made principally by India and China in Asia, and
Saudi Arabia and the United Arab Emirates in the Near East. These purchasing
tendencies are subject to abrupt change based on the strength of either the threat
assessments of individual states or the strength of their individual economies. For the
larger group of nations in these regions the strength of the economies of a wide range
of nations in the developing world continues to be the most 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 wish to modernize 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. Yet in Latin America and Africa, many countries are
constrained in their weapons purchases by their 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 be limited to a
small number of nations there.

General Trends in Arms Transfers to Developing Nations
      The value of all arms transfer agreements with developing nations in 2007 was
nearly $42.3 billion, an increase from the $38.1 billion total in 2006 Chart 1)(Figure
1)(Table 1A). In 2007, the value of all arms deliveries to developing nations ($17.2
billion) was lower than the value of 2006 deliveries (over $21.4 billion), and the
lowest total for the 2000-2007 period (Charts 7 and 8)(Figure 2)(Table 2A).

      Recently, from 2004-2007, the United States and Russia have dominated the
arms market in the developing world, with both nations either ranking first or second
for 3 out of these 4 years in the value of arms transfer agreements. From 2004-2007,
Russia made nearly $39.3 billion, 27.9% of all such agreements, expressed in
constant 2007 dollars. During this same period, the United States made $34.7 billion
in such agreements, 24.6% of all such agreements. Collectively, the United States
and Russia made 52.5% of all arms transfer agreements with developing nations
during this four year period. The United Kingdom, the third leading supplier, from
                                        CRS-7

2004-2007 made $21.3 billion or 15.1% of all such agreements with developing
nations during these years. In the earlier period (2000-2003) the United States ranked
first with $46.4 billion in arms transfer agreements with developing nations or
48.3%; Russia made $25.6 billion in arms transfer agreements during this period or
26.6%. France made nearly $5 billion in agreements or 5.2% (Table 1A).

      From 2000-2007, most arms transfers to developing nations were made by two
major suppliers in any given year. The United States ranked first among these
suppliers for five of the last eight years during this period, falling to third place in
2005. Russia has been a strong competitor for the lead in arms transfer agreements
with developing nations, ranking second every year from 2000 through 2003, and
first from 2004-2006. Although Russia has lacked the larger traditional client base
for armaments held by the United States and the major West European suppliers, its
recent successes in concluding new arms orders suggests that Russia is likely to
continue to be, for some time, a significant leader in arms agreements with
developing nations. Russia's most significant high value arms transfer agreements
continue to be with India and China. Russia has also 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 after the end of the Cold
War. Venezuela has become a significant new arms client gained by Russia in this
region. The Russian government 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. Additionally, Russia continues to seek 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 and spare parts for the weapons systems it exports.

       Major West European arms suppliers, particularly 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 readily available. Germany has been a key source of naval systems
for developing nations. Although it faces increased competition from these other
major arms suppliers, the United States appears likely to hold its position as the
principal supplier to key developing world nations, especially those able to afford
major new weapons. The United States has developed for decades such a wide base
of arms equipment clients globally that 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 previously sold to its clients. Thus, even when the
United States 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 principal arms-supplying nations continue to focus their sales efforts on the
wealthier developing countries. Arms transfers to the less affluent developing
nations are still 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 arms
                                      CRS-8

agreements with developing nations that began after 2001 and continued through
2003 has halted. Arms transfer agreements with developing countries reached their
highest total value in 2007 at nearly $43.3 billion. From 2004 through 2007 there has
been a steady increase in arms transfer agreements with developing countries, aid to
an important degree by sales to the more affluent nations in this group. Those
developing nations with notably increased oil revenues have been particularly active
in seeking new weaponry most recently.

     China, as well as other European and non-European suppliers, appears to have
increased their participation in the arms trade with the developing world in recent
years, albeit at lower levels, and with more 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 2000-2007 have been comparatively low, although the
values are larger when they are aggregated together as a group. In individual cases
they have been successful in selling older generation equipment, while they procure
newer weapons to upgrade 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
have not consistently ranked 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 $9.1 billion in 2006 to $12.2
billion in 2007. The U.S. share of the value of all such agreements was 28.8% in
2007, up from a 24% share in 2006 (Charts 1, 3 and 4)(Figure 1)(Tables 1A and
1B).

      In 2007, the total value of U.S. arms transfer agreements with developing
nations was attributable to a few major deals with clients in the Near East and in
Asia. 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 2007 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 2007 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 2007 with developing nations were: with the United Arab Emirates for 26 UH-
60M Black Hawk helicopters for over $800 million, and for 20 High Mobility
Artillery Rocket Systems (HIMARS) launchers and rockets for $595 million. Other
U.S. arms agreements in 2007 were with Egypt for co-production of 125 M1A1
Abrams tanks for $771 million; with Saudi Arabia for 152 GE/Pratt&Whitney jet
engines for $386 million, and for F-15 aircraft follow-on services for $319 million;
with South Korea for 58 AN/VRC-90E SINCGAR radio systems for $427 million
                                        CRS-9

and for 210 SM-2 STANDARD Block III missiles for $210 million; with Colombia
for 15 UH-60L Black Hawk helicopters for $217 million; and with Jordan for a
C4SIR system for $208 million.

     Russia. The total value of Russia's arms transfer agreements with developing
nations in 2007 was $9.7 billion, a decrease from $14.4 billion in 2006, placing
Russia third in such agreements with the developing world. Russia's share of all
developing world arms transfer agreements increased, then fell from 37.9% in 2006
to 23% in 2007 (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 2004-2007 period, Russia ranked first
among all suppliers to developing countries, making $37.9 billion in agreements (in
current 2007 dollars) (Table 1F). Russia's status as a leading supplier of arms to
developing nations stems from a successful effort to overcome the significant
economic and political problems associated with the dissolution of the former Soviet
Union. Traditional arms clients of the former Soviet Union were generally less
wealthy developing countries valued as much for their political support during the
Cold War, as for their desire for Soviet weaponry. Several 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 post-Cold War period, Russia modified and adapted its selling
practices in an effort to regain and sustain an important share of the developing-world
arms market.

      In recent years, Russian leaders have made significant efforts to provide more
creative financing and payment options for prospective arms clients. They have
agreed to engage in counter-trade, offsets, debt-swapping, and, in key cases, to make
significant licensed production agreements in order to sell Russia's weapons. The
willingness to license production has been a central element in several cases
involving Russia's principal arms clients, India and China. Russia's efforts to
expand its arms customer base have met with mixed results. Russia's arms sales
efforts, apart from those with China and India, have been focused on Southeast Asia.
Here Russia has secured arms agreements with Malaysia, Vietnam, and Indonesia.
Most recently Russia has concluded major arms deals with Venezuela and with
Algeria. Elsewhere in the developing world Russian military equipment can be
competitive because it ranges from the most basic to the highly advanced. For less
affluent developing nations Russia's less expensive armaments are particularly
attractive.

     The sale of military aircraft and missiles continues to be a significant portion of
Russia's arms exports. But the absence of major new research and development
efforts in this and other military equipment areas can jeopardize long-term Russian
foreign arms sales prospects. Although military weapons research and development
(R&D) programs exist in Russia, other major arms suppliers are currently more
advanced in the process of developing and producing weaponry than in existing
Russian R&D programs.
                                       CRS-10

      Despite these potential difficulties, Russia continues to have important arms
development and sales programs involving India and China, which should provide
it with sustained business throughout this decade. Through agreements concluded
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 licensed
production. It continues to provide support services and items for these various
weapons systems. 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. When India acquires a new weapon system this typically
leads Pakistan to seek comparable weapons or those with offsetting capabilities. A
key U.S. policy objective is keeping a potentially destabilizing arms race in this
region within check.1

      China has been Russia's other key arms client in Asia, 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 Su-
30 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 2007 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 2007 were with
India. These agreements included the sale of 347 T-90 main battle tanks, 40 Su-
30MKI combat fighter aircraft and a number of MiG-29 fighter aircraft. Also
concluded was an agreement for the production of jet aircraft engines and one for



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'Rourke; and CRS Report RL33153, China Naval Modernization: Implications for U.S.
Navy Capabilities -- Background and Issues for Congress, by Ronald O'Rourke.
                                           CRS-11

long term defense production cooperation. An important portion of Russia's $9.7
billion arms agreement total for 2007 was with India.

     In 2007, Russia also made new arms sales with Indonesia for three Su-27SKM
and three Su-30MK2 fighter aircraft for $355 million, and for Mi-17 and Mi35M
helicopters for over $100 million. Iran contracted with Russia for five batteries of
the S-300PMU1 air defense system, and Syria purchased the Buk-M1-2 air defense
system.

     China. The Iran-Iraq war in the 1980s provided China with the opportunity 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. Since that time
China's arms sales have been more regional and targeted. From 2004-2007, the
value of China's arms transfer agreements with developing nations averaged about
$2.3 billion annually. During the period of this report, the value of China's arms
transfer agreements with developing nations were highest in 2007 at $3.8 billion. A
significant portion of that total can be attributed to a significant contract with
Pakistan associated with the production of the J-17 fighter aircraft. Generally,
China's sales figures reflect several smaller valued weapons deals in Asia, Africa,
and the Near East, rather than one or two especially large agreements for major
weapons systems (Tables 1A, 1G, and 1H)(Chart 3).

      There have been few developing nations with significant financial resources that
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 key supplier of major conventional
weapons in the international arms market for the foreseeable future. China's likely
client base could be 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. 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 may have 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.3


3
    For detailed background on the MTCR and proliferation control regimes and related policy
                                                                              (continued...)
                                        CRS-12

     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 may view 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.4

     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 and generally have supported the
U.S. position in restricting arms sales to certain nations during the Cold War era. 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 leading 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 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.




3
  (...continued)
issues see CRS Report RL31559, Proliferation Control Regimes: Background and Status,
by Mary Beth Nikitin, Paul Kerr, Steve Bowman and Steven A. Hildreth, 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.
4
 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

policymakers, given their capability to make sales of advanced military equipment
to countries of concern to U.S. national security policy.5

     The four major West European suppliers (France, the United Kingdom,
Germany, and Italy), as a group, registered a significant increase in their collective
share of all arms transfer agreements with developing nations between 2006 and
2007. This group's share rose from 18.5% in 2006 to 32.2% in 2007. The collective
value of this group's arms transfer agreements with developing nations in 2007 was
$13.6 billion compared with a total of $7.1 billion in 2006. Of these four nations, the
United Kingdom was the leading supplier with $9.8 billion in agreements in 2007,
a dramatic increase from $4.1 billion in agreements in 2006. A substantial portion
of the United Kingdom's $9.8 billion agreement total in 2007 is attributable to an
order valued in excess of $9 billion from Saudi Arabia for 72 Typhoon Eurofighter
aircraft. Germany's $1.5 billion in arms agreements in 2007 resulted primarily from
an agreement with South Korea for the purchase of an existing Patriot PAC-2 air
defense system for $1.2 billion (Charts 3 and 4)(Tables 1A and 1B).

     Collectively, the four major West European suppliers held a 32.2% share of all
arms transfer agreements with developing nations during 2007. In the period from
2004-2007 they have generally been important participants in the developing world
arms market. Individual suppliers within the major West European group have had
notable years for arms agreements, especially France in 2000 and 2005 ($2.2 billion
and $6.8 billion, respectively). The United Kingdom also had large agreement years
in 2004 ($4.5 billion), in 2006 ($4.1 billion), and $9.8 billion in 2007. Germany
concluded arms agreements totaling nearly $2 billion in 2006, and $1.5 billion in
2007. In the case of each of these three European nations, large agreement totals in
one year have usually reflected the conclusion of very large arms contracts with one
or more major purchasers in that particular year (Table 1A and 1B).

      The 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. But 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, on a sustained basis,
large new contracts with developing nations.



5
 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

     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.
The 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.

     A few 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.6

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
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 United States 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


6
 For detailed background on issues relating to the Joint Strike Fighter program see CRS
Report RL30563, F-35 Lightning II Joint Strike Fighter (JSF) Program: Background,
Status, and Issues, by Christopher Bolkcom.
                                         CRS-15

turn, by a review of data regarding the leading arms purchasers in the developing
world.

      Near East.7 The primary 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 U.S.-led 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. Subsequently, major concerns over the growing
strategic threat from Iran has become the principal driver of GCC states' arms
purchases. Because GCC states do not share a land border with Iran, their weapons
purchases have focused primarily on air, naval, and missile defense systems. Egypt
and Israel, meanwhile, have continued their military modernization programs,
increasing their arms purchases from the United States.8

      Most recently, the position of Saudi Arabia as principal arms purchaser in the
Persian Gulf region has been re-established. In the period from 2000-2003, Saudi
Arabia's total arms agreements were valued at $3.2 billion (in current dollars), less
than the levels of the U.A.E., Egypt, and Israel. For the period from 2004-2007,
Saudi Arabia's total arms agreements were $23.2 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 2000-2003, it accounted for 42.3% of the total value of all
developing nations arms transfer agreements ($33.3 billion in current dollars),
ranking it second behind Asia which was first with 46.9% of these agreements ($35.2
billion in current dollars). But, during 2004-2007, the Near East region accounted
for 46.3% of all such agreements ($63.1 billion in current dollars), again placing it
first in arms agreements with the developing world. The Asia region ranked second
in 2004-2007 with $57.6 billion in agreements or 42.3% (Tables 1C and 1D).

     The United States dominated arms transfer agreements with the Near East
during the 2000-2003 period with 73.6% of their total value ($24.5 billion in current
dollars). Russia was second during these years with 9.3% ($3.1 billion in current
dollars). Recently, from 2004-2007, the United States accounted for 32.8% of arms
agreements with this region ($20.7 billion in current dollars), while the United
Kingdom accounted for 27.9% of the region's agreements ($17.6 billion in current
dollars). Russia accounted for 20.8% of the region's agreements in the most recent
period ($13.1 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


7
 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.
8
 For detailed background see CRS Report RL31533, The Persian Gulf States: Issues for
U.S. Policy, 2006, by Kenneth Katzman.
                                      CRS-16

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. In 2007, India made major
purchases from Russia of T-90 main battle tanks, Su-30 MKI fighter aircraft, and
MiG-29 fighter aircraft. The United States made a multi-billion dollar sale to
Pakistan in 2006 of new F-16 fighter aircraft, weapons, and aircraft upgrades, while
Sweden sold it a SAAB-2000 based AWACS airborne radar system for over a billion
dollars. In 2007, Pakistan contracted with China for production of J-17 fighter
aircraft. These transactions have placed Pakistan among the leading major Asian
arms buyers of recent years. The data on regional arms-transfer agreements from
2000-2007 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 2004-2007, Asia ranked second, accounting for 42.3% of the total value of all
arms transfer agreements with developing nations ($57.6 billion in current dollars).
Yet in the earlier period, 2000-2003, the region ranked first, accounting for 46.9%
of all such agreements ($35.2 billion in current dollars) (Tables 1C and 1D).

     In the earlier period (2000-2003), Russia ranked first in the value of arms
transfer agreements with Asia with 49.8% ($17.5 billion in current dollars). The
United States ranked second with 19.8% ($7 billion in current dollars). The major
West European suppliers, as a group, made 12.5% of this region's agreements in
2000-2003. In the later period (2004-2007), Russia ranked first in Asian agreements
with 35.9% ($20.7 billion in current dollars), primarily due to major combat aircraft,
and naval system sales to India and China. The United States ranked second with
19.3% ($11.1 billion in current dollars). The major West European suppliers, as a
group, made 17.4% of this region's agreements in 2004-2007. (Chart 6)(Table 1E).

Leading Developing Nations Arms Purchasers
      India was the leading developing world arms purchaser from 2000-2007,
making arms transfer agreements totaling $31.9 billion during these years (in current
dollars). In the 2000-2003 period, China ranked first in arms transfer agreements at
$10.1 billion (in current dollars). In 2004-2007 India ranked first in arms transfer
agreements, with a large increase to $24.2 billion from $7.7 billion in the earlier
2000-2003 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 2000-2007 was $217.6 billion in current dollars. Thus
India alone accounted for 14.7% of all developing-world arms-transfer agreements
during these eight years. In the most recent period, 2004-2007, India made $24.2
billion in arms transfer agreements (in current dollars). This total constituted 17.8%
                                        CRS-17

of all arms transfer agreements with developing nations during these four years ($136
billion in current dollars). Saudi Arabia ranked second in arms transfer agreements
during 2004-2007 with $23.2 billion (in current dollars), or 17.1% of the value of all
developing-world arms-transfer agreements (Tables 1, 1I, and 1J).

      During 2000-2003, the top ten recipients collectively accounted for 66.9% of
all developing world arms transfer agreements. During 2004-2007, the top ten
recipients collectively accounted for 61.6% of all such agreements. Arms transfer
agreements with the top ten developing world recipients, as a group, totaled $34.1
billion in 2007 or 80.6% 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).

      Saudi Arabia ranked first among all developing world recipients in the value of
arms transfer agreements in 2007, concluding $10.6 billion in such agreements.
India ranked second in agreements at $5 billion. Pakistan ranked third with $4.2
billion in agreements. Seven of the top ten recipients were in the Near East region;
three were in the Asian region (Table 1J).9

      India was the leading recipient of arms deliveries among developing world
recipients in 2007, receiving $1.6 billion in such deliveries. Israel ranked second in
arms deliveries in 2007 with $1.5 billion. Egypt ranked third with $1.5 billion
(Table 2J).

     Arms deliveries to the top ten developing nation recipients, as a group, were
valued at $11.1 billion, or 64.5% of all arms deliveries to developing nations in 2007.
Five of these top ten recipients were in Asia; three were in the Near East; one was in
Latin America, one was in Africa (Tables 2 and 2J).

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).

      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 2004-2007 from Table 5:

     United States.
     ! 557 tanks and self-propelled guns



9
 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

     !   587 APCs and armored cars
     !   6 minor surface combatants
     !   94 supersonic combat aircraft
     !   29 helicopters
     !   748 surface-to-air missiles
     !   77 anti-ship missiles

     Russia.
     ! 230 tanks and self-propelled guns
     ! 260 APCs and armored cars
     ! 30 supersonic combat aircraft
     ! 30 helicopters
     ! 1,640 surface-to-air missiles



     China.
     ! 60 other aircraft
     ! 80 anti-ship missiles


     Major West European Suppliers.
     ! 20 tanks and self-propelled guns
     ! 60 APCs and armored cars
     ! 3 major surface combatants
     ! 27 minor surface combatants
     ! 6 guided missile boats
     ! 20 supersonic combat aircraft
     ! 10 helicopters
     ! 80 anti-ship missiles


     All Other European Suppliers.
     ! 130 tanks and self-propelled guns
     ! 1,280 APCs and armored cars
     ! 10 minor surface combatants
     ! 9 guided missile boats
     ! 320 surface-to-air missiles
     ! 70 anti-ship missiles


     All Other Suppliers.
     ! 560 APCs and armored cars
     ! 88 minor surface combatants
     ! 20 helicopters
     ! 30 surface-to-surface missiles
     ! 20 anti-ship missiles


     Large numbers of major combat systems were delivered to the Near East region
from 2004-2007, 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
                                       CRS-19

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 self-
propelled 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 2004-2007 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 2004-2007, the United States delivered 77 anti-ship
missiles to the Near East region, China delivered 80, and the four major West
European suppliers delivered 80. The United States delivered six minor surface
combatants to the Near East, while the major West European suppliers collectively
delivered three major surface combatants, 27 minor surface combatants and six
guided missile boats. The non-major West European suppliers collectively delivered
70 anti-ship missiles. Other non-European suppliers collectively delivered 560 APCs
and armored cars, 88 minor surface combatants, as well as 30 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

 Arms Values Data Tables and Charts for 2000-2007
     Tables 1 through 1J present data on arms transfer agreements with developing
nations by major suppliers from 2000-2007. 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.
Tables 8, 8A, 8B, 8C, and 8D provide data on worldwide arms transfer agreements
from 2000-2007, while Tables 9, 9A, 9B, 9C, and 9D 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. Illustrative pie and bar charts are provided in this section to give the relative
market share of individual arms suppliers globally, to the developing world and to
specific regions. Figure 1 provides the value of worldwide arms transfer agreements
for 2000-2003, 2004-2007, and 2007, and the suppliers' share of such agreements
with the developing world. Figure 2 provides the value of worldwide arms deliveries
for 2000-2003, 2004-2007, and 2007, and the suppliers' share of such deliveries with
the developing world. Specific content of other individual data tables is described
below.

     Table 1 shows the annual current dollar values of arms transfer agreements to
developing nations by major suppliers from 2000-2007. This table provides the data
from which Tables 1A (constant dollars) and Table 1B (supplier percentages) are
derived.

     !   Regional Arms Transfer Agreements, 2000-2007

     Table 1C gives the values of arms transfer agreements between suppliers and
individual regions of the developing world for the periods 2000-2003 and 2004-2007.
These values are expressed in current U.S. dollars.10 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 2000-2003 and 2004-
2007.

     !   Arms Transfer Agreements With Developing Nations,
         2000-2007: Leading Suppliers Compared

     Table 1F gives the values of arms transfer agreements with the developing
nations from 2000-2007 by the top eleven suppliers. The table ranks these suppliers

10
  Because these regional data are composed of four-year aggregate dollar totals, they are
expressed in current dollar terms.
                                           CRS-22

on the basis of the total current dollar values of their respective agreements with the
developing world for each of three periods -- 2000-2003, 2004-2007, and 2000-
2007.
     ! Arms Transfer Agreements With Developing Nations in 2007:
        Leading Suppliers Compared

    Table 1G ranks and gives for 2007 the values of arms transfer agreements with
developing nations of the top eleven suppliers in current U.S. dollars.

        !   Arms Transfer Agreements With Near East 2000-2007:
            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 2000-2003 and 2004-
2007. These values are expressed in current U.S. dollars. They are a subset of the
data contained in Table 1 and Table 1C.

        !   Arms Transfers to Developing Nations, 2000-2007: Agreements
            With Leading Recipients

     Table 1I gives the values of arms transfer agreements made by the top ten
recipients of arms in the developing world from 2000-2007 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--2000-
2003, 2004-2007, and 2000-2007.

        !   Arms Transfers to Developing Nations in 2007: Agreements
            With Leading Recipients

     Table 1J names the top ten developing world recipients of arms transfer
agreements in 2007. The table ranks these recipients on the basis of the total current
dollar values of their respective agreements with all suppliers in 2007.

        !   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 2000-2007. 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.

        !   Regional Arms Delivery Values, 2000-2007

     Table 2C gives the values of arms deliveries by suppliers to individual regions
of the developing world for the periods 2000-2003 and 2004-2007. These values are
expressed in current U.S. dollars.11 Table 2D, derived from Table 2C, gives the


11
     Because these regional data are composed of four-year aggregate dollar totals, they are
                                                                             (continued...)
                                       CRS-23

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 2000-2003 and 2004-2007.

     !   Arms Deliveries to Developing Nations, 2000-2007: Leading
         Suppliers Compared

      Table 2F gives the values of arms deliveries to developing nations from 2000-
2007 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 -- 2000-2003, 2004-2007, and 2000-2007.

     !   Arms Deliveries to Developing Nations in 2007: Leading
         Suppliers Compared

     Table 2G ranks and gives for 2007 the values of arms deliveries to developing
nations of the top ten suppliers in current U.S. dollars.

     !   Arms Deliveries to Near East, 2000-2007: Suppliers and
         Recipients

     Table 2H gives the values of arms delivered to Near East nations by suppliers
or categories of suppliers for the periods 2000-2003 and 2004-2007. These values
are expressed in current U.S. dollars. They are a subset of the data contained in
Table 2 and Table 2C.

     !   Arms Deliveries to Developing Nations, 2000-2007: The Leading
         Recipients

     Table 2I gives the values of arms deliveries made to the top ten recipients of
arms in the developing world from 2000-2007 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 -- 2000-2003, 2004-2007, and
2000-2007.

     !   Arms Transfers to Developing Nations in 2007: Agreements
         With Leading Recipients

     Table 2J names the top ten developing world recipients of arms transfer
agreements in 2007. The table ranks these recipients on the basis of the total current
dollar values of their respective agreements with all suppliers in 2007.




11
  (...continued)
expressed in current dollar terms.
                                  CRS-24



       Chart 1. Arms Transfer Agreements Worldwide, 2000-2007
               Developed and Developing Worlds Compared
In billions of constant
2007 dollars
60
                                  Developed World
55                                Developing World

50

45

40

35

30

25

20

15

10

 5

 0
       2000      2001      2002   2003     2004      2005   2006   2007

     Source: U.S. Government
                                   CRS-25

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




Source: U.S. Government
                                      CRS-26

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




Source: U.S. Government
                                                 CRS-27

Chart 4. Arms Transfer Agreements With Developing Nations by Major Supplier, 2000-2007
                             (billions of constant 2007 dollars)
                      United States                                     Russia
 25                                                16
                                                   14
 20
                                                   12

                                                   10
 15
                                                   8
 10                                                6

                                                   4
 5
                                                   2

 0                                                 0
        2000 2001 2002 2003 2004 2005 2006 2007         2000 2001 2002 2003 2004 2005 2006 2007

                Major West European                                    All Others
16                                                 16

14                                                 14

12                                                 12

10                                                 10

 8                                                  8

 6                                                  6

 4                                                  4

 2                                                  2

 0                                                  0
       2000 2001 2002 2003 2004 2005 2006 2007            2000 2001 2002 2003 2004 2005 2006 2007




      Source: U.S. Government
                                CRS-28

Figure 1. Worldwide Arms Transfer Agreements, 2000-2007 and
            Suppliers' Share with Developing World
           (in millions of constant 2007 U.S. dollars)

                          Worldwide Agreements   Percentage of Total with
Supplier                    Value 2000-2003         Developing World
United States                    65,948                   70.40
Russia                           26,610                   96.00
France                           13,656                   36.30
United Kingdom                    2,919                   39.50
China                             3,164                  100.00
Germany                           6,660                   21.80
Italy                             2,677                   26.00
All Other European               15,601                   38.20
All Others                       10,322                   64.90
TOTAL                           147,558                   65.10

                          Worldwide Agreements   Percentage of Total with
Supplier                    Value 2004-2007         Developing World
United States                    68,886                   50.40
Russia                           40,940                   96.00
France                           18,440                   53.50
United Kingdom                   23,506                   90.70
China                             9,383                  100.00
Germany                           7,199                   61.10
Italy                             4,367                   61.90
All Other European               23,421                   44.70
All Others                       12,202                   72.80
TOTAL                           208,344                   67.70

                          Worldwide Agreements   Percentage of Total with
Supplier                       Value 2007           Developing World
United States                    24,860                   48.90
Russia                           10,400                   93.30
France                            1,800                   83.30
United Kingdom                    9,800                  100.00
China                             3,800                  100.00
Germany                           1,500                  100.00
Italy                              900                    88.90
All Other European                4,400                   36.40
All Others                        2,500                   56.00
TOTAL                            59,960                   70.50

Source: U.S. Government
                                    CRS-29

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




Source: U.S. Government
                                 CRS-30

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




Source: U.S. Government
                                      CRS-31




                    Chart 7. Arms Deliveries Worldwide 2000-2007
                    Developed and Developing Worlds Compared
     In billions of constant
     2007 dollars
50
                                      Developed World
45                                    Developing World


40


35

30

25


20

15


10

 5

 0
        2000       2001        2002   2003     2004      2005   2006   2007

Source: U.S. Government
                                                     CRS-32

            Chart 8. Arms Deliveries to Developing Countries by Major Supplier, 2000-2007
                                 (in billions of constant 2007 dollars)

                         United States                                        Russia
10                                                      10


 8                                                       8


 6                                                       6


 4                                                       4


 2                                                       2


 0                                                       0
          2000 2001 2002 2003 2004 2005 2006 2007             2000 2001 2002 2003 2004 2005 2006 2007



                       Major West European                                  All Others
 10                                                     10


     8                                                   8


     6                                                   6


     4                                                   4


     2                                                   2

     0                                                   0
           2000 2001 2002 2003 2004 2005 2006 2007            2000 2001 2002 2003 2004 2005 2006 2007


         Source: U.S. Government
                                 CRS-33

 Figure 2. Worldwide Arms Deliveries, 2000-2007 and Suppliers'
                   Share with Developing World
            (in millions of constant 2007 U.S. dollars)

                          Worldwide Deliveries
                                                 Percentage of Total to
 Supplier                       Value
                                                   Developing World
                              2000-2003
 United States                  50,551                   60.30
 Russia                         19,752                   91.60
 France                         10,056                   66.30
 United Kingdom                 23,290                   75.30
 China                           4,094                   89.50
 Germany                         6,380                   30.90
 Italy                           2,095                   33.40
 All Other European             15,266                   56.00
 All Others                     12,132                   48.20
 TOTAL                         143,617                   65.10

                          Worldwide Deliveries
                                                 Percentage of Total to
 Supplier                       Value
                                                   Developing World
                              2004-2007
 United States                  51,216                   64.30
 Russia                         20,125                   95.90
 France                         12,174                   73.00
 United Kingdom                 14,512                   69.40
 China                           4,460                   93.20
 Germany                         7,328                   32.90
 Italy                           1,975                   31.40
 All Other European             12,248                   37.40
 All Others                     10,881                   39.90
 TOTAL                         134,918                   64.70

                          Worldwide Deliveries   Percentage of Total to
 Supplier
                              Value 2007          Developing World
 United States                  12,793                   59.50
 Russia                          4,700                   97.90
 France                          2,100                   33.30
 United Kingdom                  2,600                   34.60
 China                           1,400                   85.70
 Germany                         1,000                   40.00
 Italy                            500                    40.00
 All Other European              3,200                   34.40
 All Others                      2,700                   18.50
 TOTAL                          30,933                   55.60
Source: U.S. Government
                                                                                           CRS-34

                          Table 1. Arms Transfer Agreements with Developing Nations, by Supplier, 2000-2007
                                                  (in millions of current U.S. dollars)

                                       2000              2001              2002              2003             2004              2005              2006              2007          2000-2007
 United States                        18,624             6,343             8,334            5,915             6,819             5,643             8,925            12,160           72,763
 Russia                                6,600             5,300             5,400            4,500             7,300             6,800            14,100            9,700            59,700
 France                                1,800             1,100              400              900              1,100             6,400              400             1,500            13,600
 United Kingdom                           0               200               700              100              4,100             2,800             4,000            9,800            21,700
 China                                  600              1,100              400              600               900              3,000             1,400            3,800            11,800
 Germany                               1,000              100               100                0               100               800              1,900            1,500             5,500
 Italy                                  100               200                0               300               600               600               600               800             3,200
 All Other European                    1,300             1,100             1,400            1,300             2,300             3,500             2,600            1,600            15,100
 All Others                            1,800             1,600             1,100            1,200             2,500             1,300             3,300            1,400            14,200


 TOTAL                                31,824            17,043            17,834            14,815           25,719            30,843            37,225            42,260           217,563
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-35

                      Table 1A. Arms Transfer Agreements with Developing Nations, by Supplier, 2000-2007
                                           (in millions of constant 2007 U.S. dollars)
                                                                                                                            TOTAL
                                   2000           2001      2002      2003      2004      2005      2006      2007
                                                                                                                           2000-2007
 United States                    22,673          7,491     9,585     6,654     7,445     5,956     9,142     12,160        81,105
 Russia                           8,035           6,259     6,210     5,062     7,970     7,177     14,442    9,700         64,856
 France                           2,191           1,299      460      1,012     1,201     6,755      410      1,500         14,828
 United Kingdom                      0             236       805       112      4,476     2,955     4,097     9,800         22,482
 China                             730            1,299      460       675       983      3,166     1,434     3,800         12,547
 Germany                          1,217            118       115        0        109       844      1,946     1,500          5,850
 Italy                             122             236        0        337       655       633       615       800           3,398
 All Other European               1,583           1,299     1,610     1,462     2,511     3,694     2,663     1,600         16,422
 All Others                       2,191           1,889     1,265     1,350     2,730     1,372     3,380     1,400         15,577


 TOTAL                            38,744          20,126    20,511    16,665    28,081    32,552    38,129    42,260        237,067


 Dollar inflation Index:
 (2007=1.00)*                      0.8214          0.8468    0.8695     0.889    0.9159    0.9475    0.9763            1
Source: U.S. Government
*Based on Department of Defense Price Deflator.
                                                                                 CRS-36

                      Table 1B. Arms Transfer Agreements with Developing Nations, by Supplier, 2000-2007
                                           (expressed as a percent of total, by year)

                                  2000             2001              2002            2003      2004      2005      2006      2007
United States                    58.52%           37.22%           46.73%           39.93%    26.51%    18.30%    23.98%    28.77%
Russia                           20.74%           31.10%           30.28%           30.37%    28.38%    22.05%    37.88%    22.95%
France                           5.66%             6.45%            2.24%            6.07%     4.28%    20.75%     1.07%     3.55%
United Kingdom                   0.00%             1.17%            3.93%            0.67%    15.94%     9.08%    10.75%    23.19%
China                            1.89%             6.45%            2.24%            4.05%     3.50%     9.73%     3.76%     8.99%
Germany                          3.14%             0.59%            0.56%            0.00%     0.39%     2.59%     5.10%     3.55%
Italy                            0.31%             1.17%            0.00%            2.02%     2.33%     1.95%     1.61%     1.89%
All Other European               4.08%             6.45%            7.85%            8.77%     8.94%    11.35%     6.98%     3.79%
All Others                       5.66%             9.39%            6.17%            8.10%     9.72%     4.21%     8.87%     3.31%
[Major West European*            9.11%             9.39%            6.73%            8.77%    22.94%    34.37%    18.54%    32.18%]
TOTAL                           100.00%          100.00%           100.00%          100.00%   100.00%   100.00%   100.00%   100.00%

Source: U.S. Government

*Major West European category includes France, United Kingdom, Germany, Italy.
                                                                                    CRS-37

                                   Table 1C. Regional Arms Transfer Agreements, by Supplier, 2000-2007
                                                    (in millions of current U.S. dollars)

                                              Asia                               Near East                           Latin America                          Africa
                                 2000-2003           2004-2007        2000-2003          2004-2007         2000-2003          2004-2007          2000-2003         2004-2007
 United States                      6,977             11,092            24,487             20,655             1,191              1,638               94                186
 Russia                            17,500             20,700             3,100             13,100              300               3,600              900                500
 France                             2,700              4,600             1,200               3,600               0                300               100                900
 United Kingdom                      400               2,400              500              17,600                0                700                 0                 0
 China                              1,300              6,000              700                1,800             100                200               600               1,200
 Germany                            1,100              1,800              100                1,500               0               1,100                0                 0
 Italy                               200               1,200              100                1,000             200                100               200                300
 All Other European                 2,100              3,900             1,800               2,600             200               2,800             1,000               800
 All Others                         2,900              5,900             1,300               1,200             900                800               700                500
 [Major West European*              4,400             10,000             1,900             23,700              200               2,200              300               1,200]
 TOTAL                             35,177             57,592            33,287             63,055             2,891             11,238             3,594              4,386
Source: U.S. Government

Note: All foreign data are rounded to the nearest $100 million. The United States total for Near East in 2000-2003 includes a $6.432 billion licensed commercial agreement with the
United Arab Emirates in 2000 for 80 F-16 aircraft.

*Major West European category included France, United Kingdom, Germany, Italy.
                                                                                 CRS-38

                          Table 1D. Percentage of Each Supplier's Agreements Value by Region, 2000-2007

                                   Asia                    Near East                  Latin America                 Africa                  TOTAL
                       2000-2003          2004-2007   2000-2003    2004-2007       2000-2003   2004-2007   2000-2003     2004-2007    2000-2003   2004-2007
 United States            21.30%          33.04%      74.77%        61.53%          3.64%       4.88%       0.29%            0.55%    100.00%     100.00%
 Russia                   80.28%          54.62%      14.22%        34.56%          1.38%       9.50%       4.13%            1.32%    100.00%     100.00%
 France                   67.50%          48.94%      30.00%        38.30%          0.00%       3.19%       2.50%            9.57%    100.00%     100.00%
 United Kingdom           44.44%          11.59%      55.56%        85.02%          0.00%       3.38%       0.00%            0.00%    100.00%     100.00%
 China                    48.15%          65.22%      25.93%        19.57%          3.70%       2.17%      22.22%            13.04%   100.00%     100.00%
 Germany                  91.67%          40.91%       8.33%        34.09%          0.00%      25.00%       0.00%            0.00%    100.00%     100.00%
 Italy                    28.57%          46.15%      14.29%        38.46%         28.57%       3.85%      28.57%            11.54%   100.00%     100.00%
 All Other                41.18%          38.61%      35.29%        25.74%          3.92%      27.72%      19.61%            7.92%
 European                                                                                                                             100.00%     100.00%
 All Others               50.00%          70.24%      22.41%        14.29%         15.52%       9.52%      12.07%            5.95%    100.00%     100.00%
 [Major West              64.71%          26.95%      27.94%        63.88%          2.94%       5.93%       4.41%            3.23%
 European*                                                                                                                            100.00%     100.00%]
 TOTAL                    46.93%          42.26%      44.41%        46.27%          3.86%       8.25%       4.80%            3.22%    100.00%     100.00%

Source: U.S. Government

*Major West European category included France, United Kingdom, Germany, Italy.
                                                                                 CRS-39

                       Table 1E. Percentage of Total Agreements Value by Supplier to Regions, 2000-2007

                                            Asia                           Near East                Latin America                 Africa
                                2000-2003          2004-2007       2000-2003        2004-2007   2000-2003   2004-2007   2000-2003      2004-2007
 United States                   19.83%             19.26%          73.56%           32.76%      41.20%       14.58%     2.62%              4.24%
 Russia                           49.75%            35.94%           9.31%           20.78%      10.38%       32.03%     25.04%            11.40%
 France                           7.68%             7.99%            3.61%           5.71%       0.00%        2.67%      2.78%             20.52%
 United Kingdom                   1.14%             4.17%            1.50%           27.91%      0.00%        6.23%      0.00%              0.00%
 China                            3.70%             10.42%           2.10%           2.85%       3.46%        1.78%      16.69%            27.36%
 Germany                          3.13%             3.13%            0.30%           2.38%       0.00%        9.79%      0.00%              0.00%
 Italy                            0.57%             2.08%            0.30%           1.59%       6.92%        0.89%      5.56%              6.84%
 All Other European               5.97%             6.77%            5.41%           4.12%       6.92%        24.92%     27.82%            18.24%
 All Others                       8.24%             10.24%           3.91%           1.90%       31.13%       7.12%      19.48%            11.40%
 [Major West European*            12.51%            17.36%           5.71%           37.59%      6.92%        19.58%     8.35%             27.36%]
 TOTAL                           100.00%           100.00%         100.00%          100.00%     100.00%      100.00%    100.00%            100.00%

Source: U.S. Government

*Major West European category includes France, United Kingdom, Germany, Italy.
                                           CRS-40

 Table 1F. Arms Transfer Agreements with Developing Nations,
            2000-2007: Leading Suppliers Compared
               (in millions of current U.S. dollars)

             Rank                      Supplier             Agreements Value 2000-2003
              1                      United States*                  39,216
              2                          Russia                      21,800
              3                          France                       4,200
              4                          China                        2,700
              5                          Israel                       2,100
              6                         Ukraine                       1,800
              7                        Germany                        1,200
              8                     United Kingdom                    1,000
              9                          Brazil                        700
              10                          Italy                        600
              11                        Poland                         600

             Rank                      Supplier             Agreements Value 2004-2007
              1                         Russia                       37,900
              2                      United States                   33,547
              3                     United Kingdom                   20,700
              4                          France                       9,400
              5                          China                        9,100
              6                          Israel                       4,900
              7                        Germany                        4,300
              8                           Italy                       2,600
              9                          Spain                        2,100
              10                        Ukraine                       1,500
              11                     Netherlands                      1,400

             Rank                      Supplier             Agreements Value 2000-2007
              1                      United States*                  72,763
              2                          Russia                      59,700
              3                     United Kingdom                   21,700
              4                          France                      13,600
              5                          China                       11,800
              6                          Israel                       7,100
              7                        Germany                        5,500
              8                         Ukraine                       3,300
              9                           Italy                       3,200
              10                         Spain                        2,500
              11                      Netherlands                     1,500

Source: U.S. Government

Note: All foreign data are rounded to the nearest $100 million. Where rounded data totals are the
same, the rank order is maintained.

*The United States total includes a $6.432 billion licensed commercial agreement with the United
Arab Emirates in 2000 for 80 F-16 aircraft.
                                           CRS-41

 Table 1G. Arms Transfer Agreements with Developing Nations
            in 2007: Leading Suppliers Compared
              (in millions of current U.S. dollars)

           Rank                          Supplier                 Agreements Value 2007

              1                        United States                        12,160

              2                      United Kingdom                         9,800

              3                           Russia                            9,700

              4                            China                            3,800

              5                           France                            1,500

              6                          Germany                            1,500

              7                            Italy                             800

              8                            Israel                            700

              9                           Brazil                             300

             10                          Ukraine                             300

             11                        Switzerland                           300

Source: U.S. Government

Note: All foreign data are rounded to the nearest $100 million. Where rounded data totals are the
same, the rank order is maintained.
                                               CRS-42

  Table 1H. Arms Transfer Agreements with Near East, by Supplier
                (in millions of current U.S. dollars)

   Recipient                                      Major West        All Other       All
                   U.S.     Russia     China                                                   Total
   Country                                        European*         European       Others
2000-2003
Algeria              0       400        100             0              100            0         600
Bahrain             400       0          0              0               0             0         400
Egypt              5,900     400        200            100             200            0        6,800
Iran                 0       200        100             0              100           100        500
Iraq                 0       100         0              0              200           100        400
Israel             5,000      0          0              0              100            0        5,100
Jordan              700       0          0              0              100           200       1,000
Kuwait             1,700     100        200             0               0            200       2,200
Lebanon              0        0          0              0               0             0          0
Libya                0       100         0              0              200           300        600
Morocco              0        0          0             100              0             0         100
Oman                900       0          0             400              0             0        1,300
Qatar                0        0          0              0               0             0          0
Saudi Arabia       2,700      0          0             500              0             0        3,200
Syria                0       400         0              0               0            300        700
Tunisia              0        0          0              0               0             0          0
U.A.E.**           7,100     800         0             800             400           200       9,300
Yemen                0       700        100             0              200            0        1,000
2004-2007
Algeria              0      3,900       100             0               0             0       4,000
Bahrain             400       0          0             100              0            100       600
Egypt              4,300     500        300             0              300           100      5,500
Iran                 0      2,100       400             0              300           100      2,900
Iraq               2,000     100        100            400             700           200      3,500
Israel             3,300     300         0             800              0             0       4,400
Jordan             1,100     200         0              0              300            0       1,600
Kuwait             1,100      0          0              0               0             0       1,100
Lebanon              0        0          0              0               0            100       100
Libya                0       400         0             800             200           100      1,500
Morocco             100      200         0             500              0            200      1,000
Oman                200       0          0            2,300             0            100      2,600
Qatar                0        0          0              0               0            100       100
Saudi Arabia       5,200      0         600          16,900            400           100      23,200
Syria                0      4,900        0              0               0            500      5,400
Tunisia              0        0          0              0               0             0         0
U.A.E.             2,700     200         0            1,600            200           300      5,000
Yemen                0       200         0              0              100           200       500
Source: U.S. Government
Note: 0=data less than $50 million or nil. All data are rounded to nearest $100 million.
*Major West European includes France, United Kingdom, Germany, and Italy totals as an aggregate figure.
**The United States total for 2000-2003 includes a $6.432 billion licensed commercial agreement with the
     United Arab Emirates in 2000 for 80 F-16 aircraft.
                                            CRS-43

  Table 1I. Arms Transfer Agreements with Developing Nations,
       2000-2007: Agreements by the Leading Recipients
               (in millions of current U.S. dollars)

      Rank                    Recipient                   Agreements Value 2000-2003
        1                      China                                   10,100
        2                     U.A.E.*                                   9,300
        3                      India                                    7,700
        4                      Egypt                                    6,800
        5                      Israel                                  5,100
        6                   South Korea                                4,700
        7                   Saudi Arabia                               3,200
        8                     Malaysia                                 3,100
        9                    Singapore                                 2,300
        10                    Kuwait                                    2,200

      Rank                    Recipient                   Agreements Value 2004-2007
        1                       India                                  24,200
        2                   Saudi Arabia                               23,200
        3                     Pakistan                                 12,100
        4                      China                                    5,900
        5                      Egypt                                    5,500
        6                      Syria                                    5,400
        7                      U.A.E.                                   5,000
        8                    Venezuela                                  4,700
        9                      Israel                                   4,400
        10                  South Korea                                 4,200


      Rank                    Recipient                   Agreements Value 2000-2007
        1                      India                                   31,900
        2                   Saudi Arabia                               26,400
        3                      China                                   16,000
        4                     U.A.E.*                                  14,300
        5                     Pakistan                                 13,700
        6                      Egypt                                   12,300
        7                      Israel                                   9,500
        8                   South Korea                                 8,900
        9                      Syria                                    6,100
        10                   Venezuela                                  4,900
Source: U.S. Government
Note: All foreign data are rounded to the nearest $100 million. Where rounded data totals are the
same, the rank order is maintained.
*The U.A.E. total includes a $6.432 billion licensed commercial agreement with the United States in
     2000 for 80 F-16 aircraft.
                                           CRS-44

 Table 1J. Arms Transfer Agreements with Developing Nations
          in 2007: Agreements by Leading Recipients
               (in millions of current U.S. dollars)

                                                                        Agreements Value
             Rank                           Recipient
                                                                             2007
                1                          Saudi Arabia                       10,600
                2                              India                           5,000
                3                            Pakistan                          4,200
                4                              Syria                           3,700
                5                          South Korea                         2,700
                6                             U.A.E.                           1,900
                7                               Iraq                           1,900
                8                             Egypt                            1,700
                9                             Oman                             1,400
               10                              Israel                          1,000

Source: U.S. Government

Note: All foreign data are rounded to the nearest $100 million. Where rounded data totals are the
same, the rank order is maintained.
                                                                                      CRS-45

                                    Table 2. Arms Deliveries to Developing Nations, by Supplier, 2000-2007
                                                      (in millions of current U.S. dollars)

                                                                                                                                                                          TOTAL
                                       2000             2001            2002             2003            2003             2005            2006             2007
                                                                                                                                                                         2000-2007
 United States                         8,027           5,389            6,500           6,096            7,471            8,388           8,126            7,613           57,610
 Russia                                3,500           4,300            3,500           4,200            5,300            3,100           5,500            4,600           34,000
 France                                1,900           1,000             900            1,900            5,200            2,000            400              700            14,000
 United Kingdom                        4,300           3,400            3,400           3,900            2,400            3,000           3,300             900            24,600
 China                                  800             800              800             700              900             900             1,000            1,200           7,100
 Germany                                500             100              300             800              800             300              800              400            4,000
 Italy                                  100             200              200             100              100             100              200              200            1,200
 All Other European                    2,100           1,800            1,900           1,500             900             1,300           1,100            1,100           11,700
 All Others                            1,100           1,400            1,500           1,000            1,700            1,400            500              500            9,100
 TOTAL                                22,327           18,389          19,000           20,196          24,771           20,488          20,926           17,213          163,310

Source: U.S. Government

Note: Developing nations category excludes the United States, Russia, 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), excess defense articles, which are included for the particular fiscal year. Licensed
commercial exports are excluded. All amounts given include the values of all categories of weapons and ammunition, military spare parts, military construction, military assistance
and training programs, and all associated services. Statistics for foreign countries are based upon estimated selling prices. All foreign data are rounded to the nearest $100 million.
                                                                          CRS-46

                                Table 2A. Arms Deliveries to Developing Nations, by Supplier, 2000-2007
                                               (in millions of constant 2007 U.S. dollars)

                                                                                                                                  TOTAL
                                   2000           2001       2002       2003       2004       2005       2006       2007
                                                                                                                                 2000-2007
 United States                    9,772           6,364      7,476      6,857      8,157      8,853      8,323      7,613         63,415
 Russia                           4,261           5,078      4,025      4,724      5,787      3,272      5,634      4,600         37,381
 France                           2,313           1,181      1,035      2,137      5,677      2,111       410        700          15,564
 United Kingdom                   5,235           4,015      3,910      4,387      2,620      3,166      3,380       900          27,614
 China                             974             945        920        787        983        950       1,024      1,200         7,783
 Germany                           609             118        345        900        873        317        819        400          4,381
 Italy                             122             236        230        112        109        106        205        200          1,320
 All Other European               2,557           2,126      2,185      1,687       983       1,372      1,127      1,100         13,136
 All Others                       1,339           1,653      1,725      1,125      1,856      1,478       512        500          10,188
 TOTAL                            27,182          21,716     21,852     22,718     27,046     21,623     21,434     17,213       180,783


 Dollar inflation index:
 (2007=1.00)*                       0.8214          0.8468     0.8695      0.889     0.9159     0.9475     0.9763            1

Source: U.S. Government

*Based on Department of Defense Price Deflator.
                                                                                 CRS-47

                                Table 2B. Arms Deliveries to Developing Nations, by Supplier, 2000-2007
                                               (expressed as a percent of total, by year)

                                   2000              2001             2002            2003      2004      2005      2006      2007
 United States                    35.95%           29.31%            34.21%          30.18%    30.16%    40.94%    38.83%    44.23%
 Russia                           15.68%           23.38%            18.42%          20.80%    21.40%    15.13%    26.28%    26.72%
 France                           8.51%             5.44%            4.74%            9.41%    20.99%     9.76%     1.91%     4.07%
 United Kingdom                   19.26%           18.49%            17.89%          19.31%     9.69%    14.64%    15.77%     5.23%
 China                            3.58%             4.35%            4.21%            3.47%     3.63%     4.39%     4.78%     6.97%
 Germany                          2.24%             0.54%            1.58%            3.96%     3.23%     1.46%     3.82%     2.32%
 Italy                            0.45%             1.09%            1.05%            0.50%     0.40%     0.49%     0.96%     1.16%
 All Other European               9.41%             9.79%            10.00%           7.43%     3.63%     6.35%     5.26%     6.39%
 All Others                       4.93%             7.61%            7.89%            4.95%     6.86%     6.83%     2.39%     2.90%
 [Major West European*            30.46%           25.56%            25.26%          33.17%    34.31%    26.36%    22.46%    12.78%]


 TOTAL                           100.00%           100.00%          100.00%          100.00%   100.00%   100.00%   100.00%   100.00%

Source: U.S. Government

*Major West European category includes France, United Kingdom, Germany, Italy.
                                                                                 CRS-48

                                            Table 2C. Regional Arms Deliveries by Supplier, 2000-2007
                                                       (in millions of current U.S. dollars)

                                                   Asia                          Near East               Latin America                 Africa
                                      2000-2003           2004-2007   2000-2003        2004-2007     2000-2003   2004-2007   2000-2003      2004-2007
 United States                           8,699             10,374      16,507             19,803       716         1,265        90               156
 Russia                                 13,200             12,800       1,700                3,100     100         2,000       500               600
 France                                   600               1,600       4,900                6,100     100          400        100               100
 United Kingdom                           600               600        14,400                8,000      0           200         0                700
 China                                   1,600              2,300        900                 900        0           100        400               800
 Germany                                 1,100              900          400                 300        0            0         200              1,100
 Italy                                    100               100          100                  0        200          100        100               300
 All Other European                      1,400              1,300       4,300                1,600     700         1,200       1,000             500
 All Others                              6,500              3,000       1,300                900       400          700        700               300
 [Major West European*                   2,400              3,200      19,800             14,400       300          700        400              2,200]


 TOTAL                                  33,799             32,974      44,507             40,703       2,216       5,965       3,090            4,556

Source: U.S. Government
Note: All foreign data are rounded to the nearest $100 million.

*Major West European category includes France, United Kingdom, Germany, Italy.
                                                                                 CRS-49

                                   Table 2D. Percentage of Supplier Deliveries Value by Region, 2000-2007

                                    Asia                    Near East                  Latin America                 Africa             TOTAL       TOTAL
                                                                                                                                       2000-2003   2004-2007
                          2000-2003        2004-2007   2000-2003    2004-2007      2000-2003    2004-2007   2000-2003     2004-2007
 United States            33.44%           32.83%      63.46%        62.67%         2.75%        4.00%       0.35%            0.49%    100.00%     100.00%

 Russia                   85.16%           69.19%      10.97%        16.76%         0.65%       10.81%       3.23%            3.24%    100.00%     100.00%
 France                   10.53%           19.51%      85.96%        74.39%         1.75%        4.88%       1.75%            1.22%    100.00%     100.00%
 United Kingdom            4.00%            6.32%      96.00%        84.21%         0.00%        2.11%       0.00%            7.37%    100.00%     100.00%
 China                    55.17%           56.10%      31.03%        21.95%         0.00%        2.44%      13.79%            19.51%   100.00%     100.00%
 Germany                  64.71%           39.13%      23.53%        13.04%         0.00%        0.00%      11.76%            47.83%   100.00%     100.00%
 Italy                    20.00%           20.00%      20.00%         0.00%         40.00%      20.00%      20.00%            60.00%   100.00%     100.00%
 All Other European       18.92%           28.26%      58.11%        34.78%         9.46%       26.09%      13.51%            10.87%   100.00%     100.00%
 All Others               73.03%           61.22%      14.61%        18.37%         4.49%       14.29%       7.87%            6.12%    100.00%     100.00%
 [Major West              10.48%           15.61%      86.46%        70.24%         1.31%        3.41%       1.75%            10.73%   100.00%     100.00%]
 European*


 TOTAL                    40.42%           39.16%      53.23%        48.34%         2.65%        7.08%       3.70%            5.41%    100.00%     100.00%


Source: U.S. Government

*Major West European category includes France, United Kingdom, Germany, Italy.
                                                                                 CRS-50

                         Table 2E. Percentage of Total Deliveries Value by Supplier to Regions, 2000-2007

                                                 Asia                            Near East              Latin America                  Africa
                                      2000-2003      2004-2007        2000-2003        2004-2007    2000-2003   2004-2007    2000-2003      2004-2007
 United States                         25.74%           31.46%         37.09%            48.65%      32.31%       21.21%      2.91%             3.42%

 Russia                                39.05%           38.82%          3.82%             7.62%      4.51%        33.53%      16.18%            13.17%
 France                                 1.78%           4.85%          11.01%            14.99%      4.51%        6.71%       3.24%             2.19%
 United Kingdom                         1.78%           1.82%          32.35%            19.65%      0.00%        3.35%       0.00%             15.36%

 China                                  4.73%           6.98%           2.02%             2.21%      0.00%        1.68%       12.94%            17.56%
 Germany                                3.25%           2.73%           0.90%             0.74%      0.00%        0.00%       6.47%             24.14%
 Italy                                  0.30%           0.30%           0.22%             0.00%      9.03%        1.68%       3.24%             6.58%

 All Other European                     4.14%           3.94%           9.66%             3.93%      31.59%       20.12%      32.36%            10.97%
 All Others                            19.23%           9.10%           2.92%             2.21%      18.05%       11.74%      22.65%            6.58%

 [Major West European*                  7.10%           9.70%          44.49%            35.38%      13.54%       11.74%      12.94%            48.29%]



 TOTAL                                  100.00%         100.00%          100.00%          100.00%     100.00%      100.00%     100.00%           100.00%
Source: U.S. Government
*Major West European category includes France, United Kingdom, Germany, Italy.
                                           CRS-51

   Table 2F. Arms Deliveries to Developing Nations, 2000-2007
                  Leading Suppliers Compared
               (in millions of current U.S. dollars)
           Rank                     Supplier                Deliveries Value 2000-2003
            1                     United States                        26,012
            2                         Russia                           15,500
            3                    United Kingdom                        15,000
            4                         France                            5,700
            5                         China                             3,100
            6                        Sweden                             2,500
            7                         Israel                            1,700
            8                       Germany                             1,700
            9                        Ukraine                            1,300
            10                    North Korea                            800
            11                       Belarus                             600

           Rank                     Supplier                Deliveries Value 2004-2007
            1                     United States                        31,598
            2                         Russia                           18,500
            3                    United Kingdom                         9,600
            4                         France                            8,300
            5                         China                             4,000
            6                       Germany                             2,300
            7                         Israel                            1,300
            8                     Netherlands                            900
            9                        Ukraine                             800
            10                         Italy                             600
            11                        Brazil                             500

           Rank                     Supplier                Deliveries Value 2000-2007
            1                     United States                        57,610
            2                         Russia                           34,000
            3                    United Kingdom                        24,600
            4                         France                           14,000
            5                         China                             7,000
            6                       Germany                             3,900
            7                         Israel                            3,000
            8                        Sweden                             2,900
            9                        Ukraine                            2,200
            10                         Italy                            1,200
            11                    North Korea                           1,000
Source: U.S. Government
Note: All foreign data are rounded to the nearest $100 million. Where rounded data totals are the
same, the rank order is maintained.
                                           CRS-52

    Table 2G. Arms Deliveries to Developing Nations in 2007:
                  Leading Suppliers Compared
               (in millions of current U.S. dollars)

                                                                      Deliveries Value
          Rank                         Supplier
                                                                            2007
            1                        United States                           7,613
            2                            Russia                              4,600
            3                            China                               1,200
            4                      United Kingdom                             900
            5                            France                               700
            6                          Germany                                400
            7                         Netherlands                             200
            8                            Spain                                200
            9                           Ukraine                               200
            10                            Italy                               200
            11                           Israel                               200

Source: U.S. Government

Note: All foreign data are rounded to the nearest $100 million. Where rounded data totals are the
same, the rank order is maintained.
                                               CRS-53

             Table 2H. Arms Deliveries to Near East, by Supplier
                     (in millions of current U.S. dollars)

   Recipient                                      Major West        All Other       All
                   U.S.     Russia     China                                                   Total
   Country                                        European*         European       Others
2000-2003
Algeria             0        300        100             0              200           100       700
Bahrain            600        0          0              0               0             0        600
Egypt             5,100      200        300            100             100            0       5,800
Iran                0        300         0              0              100           400       800
Iraq                0         0          0              0              100           100       200
Israel            3,000       0          0             300              0             0       3,300
Jordan             600        0         400            100             100           100      1,300
Kuwait            1,000      100         0             300              0            200      1,600
Lebanon             0         0          0              0               0             0         0
Libya               0        100         0              0              100           200       400
Morocco             0         0          0             100             100           100       300
Oman                0         0          0              0               0            100       100
Qatar               0         0          0              0               0             0         0
Saudi Arabia      6,000       0          0           15,300           2,800           0       24,100
Syria               0        200         0              0              100            0        300
Tunisia             0         0          0              0               0             0         0
U.A.E.             200       300        100           3,300            300           100      4,300
Yemen               0        300        900            100             200            0       1,500
2004-2007
Algeria             0        900        100             0               0             0       1,000
Bahrain            300        0          0             100              0             0        400
Egypt             5,500      200        500             0              400            0       6,600
Iran                0        400        200             0               0            200       800
Iraq               300       100         0              0              200           200       800
Israel            5,700      100         0              0               0             0       5,800
Jordan             600       100         0              0               0             0        700
Kuwait            1,500       0          0              0               0             0       1,500
Lebanon             0         0          0              0               0             0         0
Libya               0        200         0              0              200            0        400
Morocco            100       100         0              0               0            200       400
Oman               700        0          0             300              0             0       1,000
Qatar               0         0          0              0               0             0         0
Saudi Arabia      4,400       0          0            9,900            200            0       14,500
Syria               0        300         0              0               0            300       600
Tunisia             0         0          0              0               0             0         0
U.A.E.             600       300         0            4,000            400            0       5,300
Yemen               0        300         0              0              100           200       600
Source: U.S. Government
Note: 0=data less than $50 million or nil. All data are rounded to nearest $100 million.
*Major West European includes France, United Kingdom, Germany, and Italy totals as an aggregate figure.
                                           CRS-54

  Table 2I. Arms Deliveries to Developing Nations, 2000-2007:
                     The Leading Recipients
               (in millions of current U.S. dollars)
                                                                       Deliveries Value
             Rank                          Recipient
                                                                          2000-2003
              1                          Saudi Arabia                       24,100
              2                             China                           8,500
              3                             Egypt                            5,800
              4                              India                          4,900
              5                             U.A.E.                           4,300
              6                            Taiwan                            4,100
              7                          South Korea                        3,400
              8                             Israel                          3,300
              9                            Pakistan                         1,700
              10                           Kuwait                            1,600

                                                                       Deliveries Value
             Rank                          Recipient
                                                                          2004-2007
              1                          Saudi Arabia                       14,500
              2                             China                           8,500
              3                              India                          6,600
              4                             Egypt                            6,600
              5                             Israel                          5,800
              6                             U.A.E.                           5,300
              7                            Taiwan                            4,300
              8                          South Korea                        3,200
              9                            Pakistan                         3,100
              10                         South Africa                       2,200

                                                                       Deliveries Value
             Rank                          Recipient
                                                                          2000-2007
              1                          Saudi Arabia                       38,600
              2                             China                           17,000
              3                             Egypt                           12,400
              4                              India                          11,500
              5                             U.A.E.                           9,600
              6                             Israel                          9,100
              7                            Taiwan                            8,400
              8                          South Korea                        6,600
              9                            Pakistan                         4,800
              10                           Kuwait                            3,100
Source: U.S. Government
Note: All foreign data are rounded to the nearest $100 million. Where rounded data totals are the
same, the rank order is maintained.
                                           CRS-55

    Table 2J. Arms Deliveries to Developing Nations in 2007:
                     The Leading Recipients
               (in millions of current U.S. dollars)

                                                                       Deliveries Value
             Rank                         Recipient
                                                                             2007

               1                             India                           1,600

               2                             Israel                          1,500

               3                            Egypt                            1,500

               4                         Saudi Arabia                        1,100

               5                           Pakistan                          1,100

               6                         South Korea                         1,000

               7                          Venezuela                          1,000

               8                         South Africa                         800

               9                            Taiwan                            800

              10                            China                             700

Source: U.S. Government

Note: All foreign data are rounded to the nearest $100 million. Where rounded data totals are the
same, the rank order is maintained.
                                      CRS-56

                Selected Weapons Deliveries to
                Developing Nations, 2000-2007
     Other useful data for assessing arms transfers are those that indicate who has
actually delivered specific numbers of specific classes of military items to a region.
These data are relatively "hard" in that they reflect actual transfers of military
equipment. They have the limitation of not giving detailed information regarding
either the sophistication or the specific name of the equipment delivered. However,
these data show relative trends in the delivery of important classes of military
equipment and indicate who the leading suppliers are from region to region over
time. Data in the following tables set out actual deliveries of fourteen categories of
weaponry to developing nations from 2000-2007 by the United States, Russia, China,
the four major West European suppliers as a group, all other European suppliers as
a group, and all other suppliers as a group. The tables show these deliveries data for
all of the developing nations collectively, for Asia, for the Near East, for Latin
America, and for Africa (Tables 3-7).

     Care should be taken in using the quantitative data within these specific tables.
Aggregate data on weapons categories delivered by suppliers do not provide precise
indices of the quality and/or quantity of the weaponry delivered. The history of
recent conventional conflicts suggests that quality and/or sophistication of weapons
can offset quantitative advantage. Further, these data do not provide an indication
of the relative capabilities of the recipient nations to use effectively the weapons
delivered to them. Superior training -- coupled with good equipment, tactical and
operational proficiency, and sound logistics -- may, in the last analysis, be a more
important factor in a nation's ability to engage successfully in conventional warfare
than the size of its weapons inventory.
                                                  CRS-57

            Table 3. Numbers of Weapons Delivered by Suppliers
                          to Developing Nations

                                                                   Major West        All Other       All
      Weapons Category               U.S.     Russia China
                                                                   European*         European       Others
 2000-2003
 Tanks and Self-Propelled
 Guns                                 462       420       200           390              860          130
 Artillery                            209       440       630           110              630          670
 APCs and Armored Cars                 60       620       360            90             1,090         560
 Major Surface Combatants              16         5         0             5                2            2
 Minor Surface Combatants              4         4         40            45               90           92
 Guided Missile Boats                   0         0         1             9                0            0
 Submarines                             0         1         0             2                2            0
 Supersonic Combat Aircraft            67       240        70            20               80           70
 Subsonic Combat Aircraft              15        10         0            30               10            0
 Other Aircraft                        53        20        90           130              150          130
 Helicopters                          121       390        10            70              100           50
 Surface-to-Air Missiles             3,017     1,770      550           50               720          540
 Surface-to-Surface Missiles            0        40         0             0                0           40
 Anti-Ship Missiles                   309       170        60           170                0           50
 2004-2007
 Tanks and Self-Propelled
 Guns                                 375       270       150            40              420           30
 Artillery                            239       20        440           10              1,260         750
 APCs and Armored Cars                641       510       450           220             1,880         691
 Major Surface Combatants               0         3         0            17                5           17
 Minor Surface Combatants              21         3        43            48               40           97
 Guided Missile Boats                   0         0         0             6                9            1
 Submarines                             0         8         0             5                4            0
 Supersonic Combat Aircraft           104       170        30            70               30           40
 Subsonic Combat Aircraft               2         0         0            30                0           10
 Other Aircraft                        36        20       120            10               70          100
 Helicopters                           67       180         0            70               30           40
 Surface-to-Air Missiles             1,222     2,810      530           10               390          150
 Surface-to-Surface Missiles            0         0         0             0                0           30
 Anti-Ship Missiles                   260       360       120           140               80           20

Source: U.S. Government

Note: Developing nations category excludes the U.S., Russia, Europe, Canada, Japan, Australia and New
Zealand. All data are for calendar years given. *Major West European includes France, United Kingdom,
Germany, and Italy totals as an aggregate figure. Data relating to surface-to-surface and anti-ship missiles by
foreign suppliers are estimates based on a variety of sources having a wide range of accuracy. As such,
individual data entries in these two weapons delivery categories are not necessarily definitive.
                                                  CRS-58

             Table 4. Number of Weapons Delivered by Suppliers
                          to Asia and the Pacific

                                                                  Major West        All Other         All
     Weapons Category               U.S.     Russia China
                                                                  European*         European         Others
 2000-2003
 Tanks and Self-Propelled
 Guns                                88        340       140             0              120             20
 Artillery                          108        10        370            10              100            170
 APCs and Armored Cars               20        320       310            20              250             80
 Major Surface Combatants            12         5          0             0                1              2
 Minor Surface Combatants            0          2         11             4               26             21
 Guided Missile Boats                0          0         0              0               0              0
 Submarines                          0          1          0             1               2              0
 Supersonic Combat
 Aircraft                            16        200        60             0               10             40
 Subsonic Combat Aircraft            15          0         0            30                0              0
 Other Aircraft                       8         20        30            0                60             60
 Helicopters                         81        230         0            20               10             10
 Surface-to-Air Missiles            2657      1090       510            0                70            480
 Surface-to-Surface
 Missiles                            0          0          0             0                0             0
 Anti-Ship Missiles                 232        140         0            80                0             0
 2004-2007
 Tanks and Self-Propelled
 Guns                               115         40       150            0                10             20
 Artillery                          108        20        190           10               110             60
 APCs and Armored Cars               54        250        80           110              440              1
 Major Surface Combatants             0          3         0            4                 1             16
 Minor Surface Combatants            6          3         14           11                8               0
 Guided Missile Boats                0          0         0             0                0               0
 Submarines                          0          8          0            1                2               0
 Supersonic Combat
 Aircraft                            0         110        20            40               10             40
 Subsonic Combat Aircraft             2          0         0            10                0              0
 Other Aircraft                      12         10        10            10               20             20
 Helicopters                         22         80         0            20               10              0
 Surface-to-Air Missiles            474       1070       530            0                70            150
 Surface-to-Surface
 Missiles                            0          0          0             0                0             0
 Anti-Ship Missiles                 173        360        40            50                0             0

Source: U.S. Government

Note: Asia and Pacific category excludes Japan, Australia and New Zealand. All data are for calendar years
given. *Major West European includes France, United Kingdom, Germany, and Italy totals as an aggregate
figure. Data relating to surface-to-surface and anti-ship missiles by foreign suppliers are estimates based on a
variety of sources having a wide range of accuracy. As such, individual data entries in these two weapons
delivery categories are not necessarily definitive.
                                                  CRS-59

            Table 5. Numbers of Weapons Delivered by Suppliers
                                to Near East

                                                                   Major West        All Other       All
      Weapons Category               U.S.     Russia China
                                                                   European*         European       Others
 2000-2003
 Tanks and Self-Propelled
 Guns                                 327       70         0            340              430           30
 Artillery                            76        0         100           70               30            0
 APCs and Armored Cars                 39       150        50            20              290           120
 Major Surface Combatants               2        0          0             2               1             0
 Minor Surface Combatants              4         0         0             30              31            44
 Guided Missile Boats                  0         0         1             9               0             0
 Submarines                             0         0         0             1                0            0
 Supersonic Combat Aircraft            47        30         0            20               30            0
 Subsonic Combat Aircraft               0         0         0             0                0            0
 Other Aircraft                        30         0        40            90               50           40
 Helicopters                           15        80        0             30               20           20
 Surface-to-Air Missiles              360       580        0             0               540           0
 Surface-to-Surface Missiles            0         0         0             0                0           40
 Anti-Ship Missiles                    77        30        60            90               0            20
 2004-2007
 Tanks and Self-Propelled
 Guns                                 557       230        0             20              130            0
 Artillery                            30         0         0             0               20            40
 APCs and Armored Cars                587       260        0             60             1280           560
 Major Surface Combatants              0         0         0              3               0             0
 Minor Surface Combatants              6         0         0             27              10            88
 Guided Missile Boats                  0         0         0             6                9             0
 Submarines                            0         0         0             0                0             0
 Supersonic Combat Aircraft            94       30         0             20               0             0
 Subsonic Combat Aircraft               0        0         0             10               0             0
 Other Aircraft                         6        0         60             0               20           40
 Helicopters                           29       30         0             10               0            20
 Surface-to-Air Missiles              748      1640        0             0               320           0
 Surface-to-Surface Missiles           0         0          0             0               0            30
 Anti-Ship Missiles                   77         0         80            80              70            20

Source: U.S. Government

Note: All data for calendar years given. *Major West European includes France, United Kingdom, Germany,
and Italy totals as an aggregate figure. Data relating to surface-to-surface and anti-ship missiles by foreign
suppliers are estimates based on a variety of sources having a wide range of accuracy. As such, individual data
entries in theses two weapons delivery categories are not necessarily definitive.
                                                    CRS-60

            Table 6. Numbers of Weapons Delivered by Suppliers
                             to Latin America

                                                                   Major West        All Other        All
     Weapons Category               U.S.     Russia     China
                                                                   European*         European        Others
 2000-2003
 Tanks and Self-Propelled
 Guns                                 0         0          0             50              130           20
 Artillery                           25         0          0             10              30            20
 APCs and Armored Cars                1         0          0             0                0             0
 Major Surface Combatants             2         0          0             2                0             0
 Minor Surface Combatants             0         0          20            1               13             0
 Guided Missile Boats                 0         0          0             0               0              0
 Submarines                           0          0          0             0               0             0
 Supersonic Combat Aircraft           4          0          0             0               0             0
 Subsonic Combat Aircraft             0          0          0             0               0             0
 Other Aircraft                       7          0          0            30              20            20
 Helicopters                         25         10          0            10              30             0
 Surface-to-Air Missiles             0          30         40            50              40            40
 Surface-to-Surface Missiles          0          0          0             0               0             0
 Anti-Ship Missiles                  0           0          0             0               0            30
 2004-2007
 Tanks and Self-Propelled
 Guns                                 0         0           0            20               0             0
 Artillery                           101        0          10            0               10             0
 APCs and Armored Cars                0         0           0             0               0             0
 Major Surface Combatants             0         0           0             7               4             0
 Minor Surface Combatants             9         0           0             1               2             2
 Guided Missile Boats                 0         0          0             0                0             0
 Submarines                           0         0          0             2                2             0
 Supersonic Combat Aircraft          10         10         0             10              20            0
 Subsonic Combat Aircraft             0          0         0              0               0            10
 Other Aircraft                      18         10         10             0              20            30
 Helicopters                         16         40         0             10              0             10
 Surface-to-Air Missiles             0          0          0             0               0             0
 Surface-to-Surface Missiles          0         0          0             0                0             0
 Anti-Ship Missiles                  10         0          0             0               10             0

Source: U.S. Government

Note: All data for calendar years given. *Major West European includes France, United Kingdom, Germany,
and Italy totals as an aggregate figure. Data relating to surface-to-surface and anti-ship missiles by foreign
suppliers are estimates based on a variety of sources having a wide range of accuracy. As such, individual data
entries in theses two weapons delivery categories are not necessarily definitive.
                                                  CRS-61

             Table 7. Number of Weapons Delivered by Suppliers
                                 to Africa

                                                                   Major West       All Other        All
      Weapons Category               U.S.     Russia China
                                                                   European*        European        Others
 2000-2003
 Tanks and Self-Propelled
 Guns                                  0         10        60             0             180            60
 Artillery                             0        430       160            20             470           480
 APCs and Armored Cars                 0        150        0             50             550           360
 Major Surface Combatants              0         0         0              1              0             0
 Minor Surface Combatants              0         2         9             10              20            27
 Guided Missile Boats                  0         0         0             0               0             0
 Submarines                            0         0          0             0               0             0
 Supersonic Combat Aircraft            0        10         10             0              40            30
 Subsonic Combat Aircraft              0        10          0             0              10             0
 Other Aircraft                        8         0         20            10              20            10
 Helicopters                           0        70         10            10              40            20
 Surface-to-Air Missiles               0        70         0             0               70            20
 Surface-to-Surface Missiles           0        40          0             0               0             0
 Anti-Ship Missiles                    0         0          0             0               0             0
 2004-2007
 Tanks and Self-Propelled
 Guns                                  0         0          0             0             280            10
 Artillery                             0         0        240            0             1120           650
 APCs and Armored Cars                 0         0        370            50             160           130
 Major Surface Combatants              0         0          0             3              0              1
 Minor Surface Combatants              0         0         29            9              20             7
 Guided Missile Boats                  0         0         0             0               0             1
 Submarines                            0         0         0             2               0             0
 Supersonic Combat Aircraft            0        20         10            0               0             0
 Subsonic Combat Aircraft              0         0          0            10              0             0
 Other Aircraft                        0          0        40             0              10            10
 Helicopters                           0         30        0             30              20            10
 Surface-to-Air Missiles               0        100        0             10              0             0
 Surface-to-Surface Missiles           0         0         0              0              0             0
 Anti-Ship Missiles                    0         0         0             10              0             0

Source: U.S. Government

Note: All data are for calendar years given. *Major West European includes France, United Kingdom,
Germany, and Italy totals as an aggregate figure. Data relating to surface-to-surface and anti-ship missiles by
foreign suppliers are estimates based on a variety of sources having a wide range of accuracy. As such,
individual data entries in these two weapons delivery categories are not necessarily definitive.
                                      CRS-62

         Worldwide Arms Transfer Agreements and
                    Deliveries Values,
                        2000-2007
      Ten tables follow. Tables 8, 8A, and 8B and Tables 9, 9A, and 9B, provide the
total dollar values for arms transfer agreements and arms deliveries worldwide for
the years 2000-2007 in the same format and detail as do Tables 1, 1A, and 1B and
Tables 2, 2A, and 2B for arms transfer agreements with and arms deliveries to
developing nations. Tables 8C, 8D, 9C, and 9D provide a list of the top eleven arms
suppliers to the world based on the total values (in current dollars) of their arms
transfer agreements and arms deliveries worldwide during calendar years 2000-2003,
2004-2007, and 2007. These tables are set out in the same format and detail as
Tables 1F and 1G for arms transfer agreements with, and Tables 2F and 2G for
arms deliveries to developing nations, respectively.

     !   Total Worldwide Arms Transfer Agreements Values,
         2000-2007

     Table 8 shows the annual current dollar values of arms transfer agreements
worldwide. 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 Tables 8A
(constant dollars) and 8B (supplier percentages) are derived.

     !   Total Worldwide Delivery Values 2000-2007

     Table 9 shows the annual current dollar values of arms deliveries (items
actually transferred) worldwide by major suppliers from 2000-2007. The utility of
these data is that they reflect transfers that have occurred. They provide the data
from which Tables 9A (constant dollars) and 9B (supplier percentages) are derived.
                                                                                       CRS-63

                                 Table 8. Arms Transfer Agreements with the World, by Supplier, 2000-2007
                                                    (in millions of current U.S. dollars)

                                                                                                                                                                    TOTAL 2000-
                                        2000            2001            2002            2003            2004            2005           2006            2007
                                                                                                                                                                       2007
 United States                         17,474          11,414          12,987          14,455          12,602         12,852          16,307          24,860            122,951
 Russia                                 6,700           5,500          5,800           4,700           7,500           7,300          14,300          10,400             62,200
 France                                 3,700           4,400           700            2,800           2,900           8,400           4,500           1,800             29,200
 United Kingdom                          600             600            700             600            6,000           2,800           4,100           9,800             25,200
 China                                   600            1,100            400            600             900            3,000           1,400           3,800             11,800
 Germany                                1,200           2,000          1,000           1,500           1,700           1,700           2,000           1,500             12,600
 Italy                                   200            1,100           400             600             600            1,500           1,200            900               6,500
 All Other European                     4,100           2,700          4,400           2,100           5,700           6,400           5,900           4,400             35,700
 All Others                             2,400           2,600          2,200           1,600           3,100           2,200           3,900           2,500             20,500


 TOTAL                                 36,974          31,414          28,587          28,955          41,002          46,152         53,607          59,960            326,651

Source: U.S. Government

Note: All data are for the calendar year given, except for U.S. MAP (Military Assistance Program) and IMET (International Military Education and Training), excess defense articles,
which are included for the particular fiscal year. All amounts given include the values of all categories of weapons and ammunition, military spare parts, military construction, excess
defense articles, military assistance and training programs, and all associated services. Statistics for foreign countries are based upon estimated selling prices. All foreign data are
rounded to the nearest $100 million. The U.S. total in 2000 includes a $6.432 billion licensed commercial agreement with the United Arab Emirates for 80 F-16 aircraft.
                                                                          CRS-64

                             Table 8A. Arms Transfer Agreements with the World, by Supplier, 2000-2007
                                             (in millions of constant 2007 U.S. dollars)

                                                                                                                                       TOTAL 2000-
                                     2000         2001        2002        2003        2004        2005        2006        2007
                                                                                                                                          2007
 United States                      21,273        13,479      14,936      16,260      13,759      13,564      16,703      24,860         134,835
 Russia                              8,157        6,495       6,671       5,287       8,189       7,704       14,647      10,400          67,549
 France                              4,505        5,196        805        3,150       3,166       8,865       4,609       1,800           32,096
 United Kingdom                       730          709         805         675        6,551       2,955       4,200       9,800           26,425
 China                                730         1,299        460         675         983        3,166       1,434       3,800           12,547
 Germany                             1,461        2,362       1,150       1,687       1,856       1,794       2,049       1,500           13,859
 Italy                                243         1,299        460         675         655        1,583       1,229        900            7,045
 All Other European                  4,991        3,188       5,060       2,362       6,223       6,755       6,043       4,400           39,024
 All Others                          2,922        3,070       2,530       1,800       3,385       2,322       3,995       2,500           22,523


 TOTAL                              45,013        37,097      32,878      32,570      44,767      48,709      54,908      59,960         355,903


 Dollar inflation index:
 (2007=1.00)*
                                        0.8214       0.8468      0.8695       0.889      0.9159      0.9475      0.9763            1

Source: U.S. Government

*Based on Department of Defense Price Deflator.
                                                                                 CRS-65

                             Table 8B. Arms Transfer Agreements with the World, by Supplier, 2000-2007
                                              (expressed as a percent of total, by year)

                                          2000             2001            2002            2003      2004      2005      2006      2007


 United States                           47.26%          36.33%           45.43%          49.92%    30.74%    27.85%    30.42%    41.46%
 Russia                                  18.12%          17.51%           20.29%          16.23%    18.29%    15.82%    26.68%    17.34%
 France                                  10.01%          14.01%           2.45%            9.67%     7.07%    18.20%     8.39%     3.00%
 United Kingdom                          1.62%            1.91%           2.45%            2.07%    14.63%     6.07%     7.65%    16.34%
 China                                   1.62%            3.50%           1.40%            2.07%     2.20%     6.50%     2.61%     6.34%
 Germany                                 3.25%            6.37%           3.50%            5.18%     4.15%     3.68%     3.73%     2.50%
 Italy                                   0.54%            3.50%           1.40%            2.07%     1.46%     3.25%     2.24%     1.50%
 All Other European                      11.09%           8.59%           15.39%           7.25%    13.90%    13.87%    11.01%     7.34%
 All Others                              6.49%            8.28%           7.70%            5.53%     7.56%     4.77%     7.28%     4.17%
 [Major West European*                   15.42%          25.78%           9.79%           18.99%    27.32%    31.20%    22.01%    23.35%]


 TOTAL                                  100.00%          100.00%         100.00%          100.00%   100.00%   100.00%   100.00%   100.00%

Source: U.S. Government
Note: Columns may not total due to rounding.

*Major West European category includes France, United Kingdom, Germany, Italy.
                                           CRS-66

        Table 8C. Arms Transfer Agreements with the World,
              2000-2007: Leading Suppliers Compared
                 (in millions of current U.S. dollars)

            Rank                      Supplier             Agreements Value 2000-2003
              1                     United States*                  56,330
              2                         Russia                      22,700
              3                         France                      11,600
              4                       Germany                        5,700
              5                         Israel                       4,000
              6                        Ukraine                       3,600
              7                         China                        2,700
              8                    United Kingdom                    2,500
              9                          Italy                       2,300
             10                         Spain                        2,100
             11                        Sweden                        1,300

            Rank                      Supplier             Agreements Value 2004-2007
              1                     United States                   66,621
              2                         Russia                      39,500
              3                    United Kingdom                   22,700
              4                         France                      17,600
              5                         China                        9,100
              6                       Germany                        6,900
              7                         Israel                       6,800
              8                         Spain                        4,400
              9                          Italy                       4,200
             10                        Sweden                        4,100
             11                        Austria                       3,000

            Rank                      Supplier             Agreements Value 2000-2007
              1                     United States*                  122,951
              2                         Russia                       62,200
              3                         France                       29,200
              4                    United Kingdom                    25,200
              5                       Germany                        12,600
              6                         China                        11,800
              7                         Israel                       10,800
              8                          Italy                       6,500
              9                         Spain                         6,500
             10                        Ukraine                        5,500
             11                        Sweden                         5,400

Source: U.S. Government

Note: All foreign data are rounded to the nearest $100 million. Where rounded data totals are the
same, the rank order is maintained. *The U.S. total includes a $6.432 billion licensed commercial
agreement with the United Arab Emirates in 2000 for 80 F-16 aircraft.
                                            CRS-67

  Table 8D. Arms Transfer Agreements with the World in 2007:
                 Leading Suppliers Compared
              (in millions of current U.S. dollars)

           Rank                           Supplier                 Agreements Value 2007

              1                        United States                      24,860

              2                            Russia                         10,400

              3                      United Kingdom                        9,800

              4                            China                           3,800

              5                            Spain                           2,000

              6                            France                          1,800

              7                          Germany                           1,500

              8                             Israel                         1,000

              9                             Italy                          900

             10                         South Korea                        500

             11                         Switzerland                        400

Source: U.S. Government

Note: All foreign data are rounded to the nearest $100 million.
Where rounded data totals are the same, the rank order is maintained.
                                                                                         CRS-68

                                             Table 9. Arms Deliveries to the World, by Supplier, 2000-2007
                                                         (in millions of current U.S. dollars)

                                                                                                                                                                             TOTAL
                                               2000           2001            2002           2003            2004            2005           2006            2007
                                                                                                                                                                            2000-2007
 United States                               12,865           9,166          10,058         11,110          11,747          12,053         12,571          12,793             92,363
 Russia                                       4,200           4,700          3,600           4,400           5,500          3,200           5,900           4,700             36,200
 France                                       2,500           2,000          1,500           2,600           5,500          2,400           1,500           2,100             20,100
 United Kingdom                               5,900           4,200          4,900           4,900           3,300          3,700           4,300           2,600             33,800
 China                                         900             900             900            800             900            900            1,100           1,400              7,800
 Germany                                      1,300            700           1,300           2,200           2,000          1,500           2,500           1,000             12,500
 Italy                                         300             500             600            400             200            900             300             500               3,700
 All Other European                           3,100           3,000          3,000           4,000           2,200          2,900           3,500           3,200             24,900
 All Others                                   2,300           2,600          3,000           2,500           3,100          2,700           1,900           2,700             20,800


 TOTAL                                        33,365         27,766          28,858         32,910          34,447          30,253         33,571          30,993            252,163
Source: U.S. Government
Note: All data are for the calendar year given, except for U.S. MAP (Military Assistance Program), IMET (International Military Education and Training), excess defense articles,
which are included for the particular fiscal year. Licensed commercial exports are excluded. All amounts given include the values of all categories of weapons and ammunition, military
spare parts, military construction, excess defense articles, military assistance and training programs, and all associated services. Statistics for foreign countries are based upon estimated
selling prices. All foreign data are rounded to the nearest $100 million.
                                                                        CRS-69

                                       Table 9A. Arms Deliveries to the World, by Supplier, 2000-2007
                                                 (in millions of constant 2007 U.S. dollars)

                                                                                                                                TOTAL
                                          2000      2001      2002        2003      2004      2005      2006      2007
                                                                                                                               2000- 2007
 United States                           15,662     10,824    11,568     12,497     12,826    12,721    12,876    12,793        101,767
 Russia                                  5,113      5,550     4,140       4,949     6,005     3,377     6,043     4,700          39,879
 France                                  3,044      2,362     1,725       2,925     6,005     2,533     1,536     2,100          22,230
 United Kingdom                          7,183      4,960     5,635       5,512     3,603     3,905     4,404     2,600          37,802
 China                                   1,096      1,063     1,035       900        983       950      1,127     1,400          8,553
 Germany                                 1,583       827      1,495       2,475     2,184     1,583     2,561     1,000          13,707
 Italy                                    365        590       690        450        218       950       307       500           4,071
 All Other European                      3,774      3,543     3,450       4,499     2,402     3,061     3,585     3,200          27,514
 All Others                              2,800      3,070     3,450       2,812     3,385     2,850     1,946     2,700          23,013
 TOTAL                                   40,620     32,789    33,189     37,019     37,610    31,929    34,386    30,993        278,536


 Dollar inflation index:
 (2007=1.00)*                              0.8214    0.8468    0.8695       0.889    0.9159    0.9475    0.9763            1

Source: U.S. Government

*Based on Department of Defense Price Deflator.
                                                                                 CRS-70

                                       Table 9B. Arms Deliveries to the World, by Supplier 2000-2007
                                                 (expressed as a percent of total, by year)

                                            2000           2001            2002            2003      2004      2005      2006      2007
 United States                            38.56%          33.01%          34.85%          33.76%    34.10%    39.84%    37.45%    41.28%
 Russia                                   12.59%          16.93%          12.47%          13.37%    15.97%    10.58%    17.57%    15.16%
 France                                    7.49%          7.20%            5.20%          7.90%     15.97%    7.93%     4.47%     6.78%
 United Kingdom                           17.68%          15.13%          16.98%          14.89%    9.58%     12.23%    12.81%    8.39%
 China                                     2.70%          3.24%            3.12%          2.43%     2.61%     2.97%     3.28%     4.52%
 Germany                                   3.90%          2.52%            4.50%          6.68%     5.81%     4.96%     7.45%     3.23%
 Italy                                     0.90%          1.80%            2.08%          1.22%     0.58%     2.97%     0.89%     1.61%
 All Other European                        9.29%          10.80%          10.40%          12.15%    6.39%     9.59%     10.43%    10.32%
 All Others                                6.89%          9.36%           10.40%          7.60%     9.00%     8.92%     5.66%     8.71%


 [Major West European*                    29.97%          26.65%          28.76%          30.69%    31.93%    28.10%    25.62%    20.00%]


 TOTAL                                     100.00%         100.00%         100.00%        100.00%   100.00%   100.00%   100.00%    100.00%

Source: U.S. Government

*Major West European category includes France, United Kingdom, Germany, Italy.
                                           CRS-71

         Table 9C. Arms Deliveries to the World, 2000-2007:
                    Leading Suppliers Compared
                 (in millions of current U.S. dollars)

           Rank                       Supplier               Deliveries Value 2000-2003
              1                   United States                         48,358
              2                  United Kingdom                         18,400
              3                       Russia                            16,100
              4                       France                             9,800
              5                      Germany                             5,000
              6                      Sweden                              4,300
              7                       China                              3,200
              8                      Ukraine                             2,300
              9                       Israel                             2,200
             10                      Canada                              1,900
             11                        Italy                             1,000
           Rank                       Supplier               Deliveries Value 2004-2007
              1                    United States                        49,164
              2                      Russia                             19,300
             3                   United Kingdom                         13,900
             4                        France                            11,500
             5                      Germany                              7,000
             6                        China                              4,300
             7                       Canada                              3,000
             8                       Sweden                              2,500
             9                        Israel                             2,000
             10                        Italy                             1,900
             11                   Netherlands                            1,700
           Rank                       Supplier               Deliveries Value 2000-2007
             1                    United States                         92,363
             2                        Russia                            36,200
             3                   United Kingdom                         33,800
             4                        France                            20,100
             5                      Germany                             12,500
             6                        China                              7,800
             7                       Sweden                              6,000
             8                       Canada                              5,600
             9                        Israel                             5,000
             10                      Ukraine                             4,300
             11                        Italy                             3,700
Source: U.S. Government
Note: All foreign data are rounded to the nearest $100 million. Where rounded data totals are the
same, the rank order is maintained.
                                           CRS-72

            Table 9D. Arms Deliveries to the World in 2007:
                      Leading Suppliers Compared
                   (in millions of current U.S. dollars)

                                                                      Deliveries Value
          Rank                         Supplier
                                                                            2007
            1                        United States                          12,793
            2                            Russia                              4,700
            3                      United Kingdom                            2,600
            4                            France                              2,100
            5                            China                               1,400
            6                          Germany                               1,000
            7                           Canada                                900
            8                           Sweden                                800
            9                            Spain                                600
            10                           Israel                               500
            11                            Italy                               500

Source: U.S. Government

Note: All foreign data are rounded to the nearest $100 million. Where rounded data totals are the
same, the rank order is maintained.
                                      CRS-73

                Description of Items Counted in
                Weapons Categories, 2000-2007
Tanks and Self-propelled Guns: This category includes light, medium, and heavy
tanks; self-propelled artillery; self-propelled assault guns.

Artillery: This category includes field and air defense artillery, mortars, rocket
launchers and recoilless rifles -- 100 mm and over; FROG launchers -- 100mm and
over.

Armored Personnel Carriers (APCs) and Armored Cars: This category includes
personnel carriers, armored and amphibious; armored infantry fighting vehicles;
armored reconnaissance and command vehicles.

Major Surface Combatants: This category includes aircraft carriers, cruisers,
destroyers, frigates.

Minor Surface Combatants: This category includes minesweepers, subchasers,
motor torpedo boats, patrol craft, motor gunboats.

Submarines: This category includes all submarines, including midget submarines.

Guided Missile Patrol Boats: This category includes all boats in this class.

Supersonic Combat Aircraft: This category includes all fighter and bomber aircraft
designed to function operationally at speeds above Mach 1.

Subsonic Combat Aircraft: This category includes all fighter and bomber aircraft
designed to function operationally at speeds below Mach 1.

Other Aircraft: This category includes all other fixed-wing aircraft, including
trainers, transports, reconnaissance aircraft, and communications/utility aircraft.

Helicopters: This category includes all helicopters, including combat and transport.

Surface-to-air Missiles: This category includes all ground-based air defense
missiles.

Surface-to-surface Missiles: This category includes all surface-surface missiles
without regard to range, such as Scuds and CSS-2s. It excludes all anti-tank missiles.
It also excludes all anti-ship missiles, which are counted in a separate listing.

Anti-ship Missiles: This category includes all missiles in this class such as the
Harpoon, Silkworm, Styx and Exocet.
                          CRS-74

   Regions Identified in Arms Transfer Tables and
                        Charts
ASIA               NEAR EAST              EUROPE
Afghanistan        Algeria                Albania
Australia          Bahrain                Armenia
Bangladesh         Egypt                  Austria
Brunei             Iran                   Azerbaijan
Burma (Myanmar)    Iraq                   Belarus
China              Israel                 Bosnia/Herzegovina
Fiji               Jordan                 Bulgaria
India              Kuwait                 Belgium
Indonesia          Lebanon                Canada
Japan              Libya                  Croatia
Cambodia           Morocco                Czechoslovakia/
Kazakhstan         Oman                   Czech Republic
Kyrgyzstan         Qatar                  Cyprus
Laos               Saudi Arabia           Denmark
Malaysia           Syria                  Estonia
Nepal              Tunisia                Finland
New Zealand        United Arab Emirates   France
North Korea        Yemen                  FYR/Macedonia
Pakistan                                  Georgia
Papua New Guinea                          Germany
Philippines                               Greece
Pitcairn                                  Hungary
Singapore                                 Iceland
South Korea                               Ireland
Sri Lanka                                 Italy
Taiwan                                    Latvia
Tajikistan                                Liechtenstein
Thailand                                  Lithuania
Turkmenistan                              Luxembourg
Uzbekistan                                Malta
Vietnam                                   Moldova
                                          Netherlands
                                          Norway
                                          Poland
                                          Portugal
                                          Romania
                                          Russia
                                          Slovak Republic
                                          Slovenia
                                          Spain
                                          Sweden
                                          Switzerland
                                          Turkey
                                          Ukraine
                                          United Kingdom
                                          Y u go s l a vi a / F e d e r a l
                                          Republic(Serbia/
                                          Montenegro)
                           CRS-75

AFRICA                          LATIN AMERICA
Angola                          Antigua
Benin                           Argentina
Botswana                        Bahamas
Burkina Faso                    Barbados
Burundi                         Belize
Cameroon                        Bermuda
Cape Verde                      Bolivia
Central African Republic        Brazil
Chad                            British Virgin Islands
Congo                           Cayman Islands
Côte d'Ivoire                   Chile
Djibouti                        Colombia
Equatorial Guinea               Costa Rica
Ethiopia                        Cuba
Gabon                           Dominica
Gambia                          Dominican Republic
Ghana                           Ecuador
Guinea                          El Salvador
Guinea-Bissau                   French Guiana
Kenya                           Grenada
Lesotho                         Guadeloupe
Liberia                         Guatemala
Madagascar                      Guyana
Malawi                          Haiti
Mali                            Honduras
Mauritania                      Jamaica
Mauritius                       Martinique
Mozambique                      Mexico
Namibia                         Montserrat
Niger                           Netherlands Antilles
Nigeria                         Nicaragua
Réunion                         Panama
Rwanda                          Paraguay
Senegal                         Peru
Seychelles                      St. Kitts & Nevis
Sierra Leone                    St. Lucia
Somalia                         St. Pierre & Miquelon
South Africa                    St. Vincent
Sudan                           Suriname
Swaziland                       Trinidad
Tanzania                        Turks & Caicos
Togo                            Venezuela
Uganda
Zaire
Zambia
Zimbabwe

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