Saudi Deal Skews Arms Sales Trend

Several weeks ago the Congressional Research Service (CRS) turned heads by reporting that U.S. global arms transfer agreements rose by a striking 210% between 2010 and 2011:

In 2011, the United States led in arms transfer agreements worldwide, making agreements valued at $66.3 billion (77.7% of all such agreements), an extraordinary increase from $21.4 billion in 2010. The United States worldwide agreements total in 2011 is the largest for a single year in the history of the U.S. arms export program.

Dramatic as this increase may appear, it has a very specific explanation.  CRS pointed out to lesser fanfare that a massive $33.4 billion contract with Saudi Arabia singlehandedly caused the spike in U.S. arms export sales in 2011:

Although the global total in weapons sales in 2011 was especially high--due primarily to the unusually large agreements value of the U. S. contracts with Saudi Arabia--the international arms market is not likely growing overall. The U.S. global total for arms agreements in 2011 seems a clear outlier figure.

Taking note of this factor allows us to dismiss several more strategic explanations: that defense industry is succeeding in diversifying overseas sales to supplement weakening domestic demand, or that there has been a fundamental shift in this aspect of US foreign policy.  Foreign military sales likely won’t stabilize at this stratospheric level without those factors kicking in, making them the important ones to watch in the future.