Developments in Arms Production and the Effects of the War in Ukraine

• Published in: Defence and peace economics 2024-08, Vol.35 (6), p.673-693
• Main Authors: Scarazzato, Lorenzo, Liang, Xiao, Tian, Nan, Lopes da Silva, Diego
• Format: Article
• Language: English
• Subjects: arms industry; Arms production; COVID-19; defence economics; Global trends; Military equipment; Military weapons; Modernization; Pandemics; Peace studies; Revenue; Time lag; Ukraine
• ISSN: 1024-2694; 1476-8267
• DOI: 10.1080/10242694.2024.2381784

This article presents global trends in arms production, building on the most recent data from the Stockholm International Peace Research Institute (SIPRI). In 2022, despite Russia's full-scale invasion of Ukraine and heightened tension around the world, arms production fell in real terms by 3.5 per cent to $597 billion. The decrease was mostly due to the performance of US companies - still plagued by the effect of the COVID-19 pandemic - and not offset by increases in other regions. Notwithstanding the global decrease, arms revenue was still 14 per cent higher than in 2015, the year in which SIPRI started including Chinese arms companies. Procurement plans for the replenishment of stockpiles and modernisation of military equipment deployed by states around the world are mostly not yet reflected in the revenue of the arms industry. In addition to the lengthy time lag between orders and deliveries, many companies have faced challenges in scaling up production. However, high order intakes suggest that arms revenue may rise significantly in the years ahead.