Arms manufacturers have seen a significant boost in sales as the wars in Ukraine and Gaza continue to escalate with no immediate signs of de-escalation, according to a report released on Monday.
The increase in sales also reflects rising tensions in Asia due to China’s firm and aggressive stance in the South China Sea, particularly concerning a disputed chain of islands largely controlled by China.
The Stockholm International Peace Research Institute (SIPRI) report revealed that the combined sales of arms and military services by the world’s 100 largest arms companies totalled $632 billion in 2023, a 4.2% increase from the previous year. The report also noted that all 100 companies tracked achieved sales of over $1 billion for the first time.
“There was a marked rise in arms revenues in 2023, and this trend is likely to continue into 2024,” said Lorenzo Scarazzato, a researcher with SIPRI’s Military Expenditure and Arms Production.
He also noted that many companies have launched recruitment drives, indicating their optimism for future sales.
Smaller producers have been more effective at meeting the demand created by the wars in Gaza and Ukraine, increasing tensions in East Asia, and rearmament programmes in other regions, the institute said.
While EU-linked companies showed steady, slow growth, Russian manufacturers experienced a significant surge in sales due to the ongoing wars in Gaza and Ukraine.
Sales by the two Russian groups in the ranking rose by 40%, with state-owned conglomerate Rostec seeing a 49% increase in sales.
Arms manufacturers in the Middle East also benefited from the Ukraine war and the early stages of the Israeli offensive in Gaza, following Hamas's October 7, 2023, attack, with an average increase of 18% in sales.
The three major Israeli arms suppliers in the SIPRI report recorded $13.6 billion in sales, a 15% increase from the previous year.
The Turkish drone manufacturing company Baykar also reported a record 24% boost in sales in 2023.
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