Tag Archives: Foreign Military Sales

November 4, 2012 · 8:30 am

Looking at History through US Foreign Military Sales

If an alien came to Earth and had to quickly make sense of the last half century of History, he could get a first glimpse of geographical hot spots and changes of regime by looking at US Foreign Military Sales program data (please refer to my previous post for an explanation of the program and sources of data).

For example, take the figure below. It shows the historical data of FMS deliveries (in thousands of $) from 1970 to 2010. As you can see deliveries stopped in 1980. What is even more telling, in the 4 years to 1979 (from 1976-79) the arms sales delivered to this country represented a whole 34% of the complete US FMS program over that period (see the total volume of deliveries in this graphic from a previous post). Which country do you think it coud be?

Which country could this be?

This alien, combining these data would know that something that happened in that country, from representing a third of military sales to not taking part in the program ever again… you may have guessed right: Iran, where the Islamic Revolution started in 1978, the Shah left the country in 1979 and at the end of that year the hostage crisis started.

Having taken a look at the graphic of Iran, find below the one for Iraq:

 

In the graphic you can see that from 1970 to 2005 there were not FMS agreements and deliveries from 2006. Nevertheless you can see that during the 1970’s and 1980’s there were commercial arms sales to Iraq from American contractors (this is also published by DSCA), which deliveries stopped altogether in 1990 (invasion of Kuwait in August 1990 and subsequent first Gulf war). Then, once the second Gulf war had changed the regime, commercial and FMS sales restarted from 2003.

There are plenty of cases to look at: Cuba not forming part of FMS since before 1970, Russia neither (though receiving commercial arms since 1992), Spain having been always part of FMS program (including during dictator Franco’s time) but which agreements surged in 1982 with the order of 72 McDonnell Douglas F/A-18 fighters (the same year in which it joined NATO), Chile, Venezuela, China…

Russia: never part of FMS.

Before concluding this post let me show again the distribution of FMS deliveries during the last 60 years per region (shown in the previous post) and a table with the main receivers in each region:

FMS Sales per region (1950-2010, source: DSCA).

FMS Agreements per region and selected countries (1950-2010, in k$ – source: DSCA).

Which have been then the top receivers of FMS Arms sales agreements in the period 1950-2010? In order:

  1. Saudi Arabia (16.9% of global FMS program)
  2. Egypt (7.3%)
  3. Israel (7.1%)
  4. Australia (4.1%)
  5. Korea (South) (4.0%)
  6. United Kingdom (4.0%)
  7. Turkey (4.0%)
  8. Japan (3.7%)
  9. Germany (3.3%)
  10. Greece (2.7%)

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November 2, 2012 · 8:00 am

US Foreign Military Sales

The Foreign Military Sales (FMS) is a program managed and operated by US Department of Defense (DoD) on a no-profit and no-loss basis. Countries and international organizations participating in the program pay for defense articles and services at prices that recoup the actual costs incurred by the United States. This includes a fee (currently 3.8% of what the defense articles and/or services cost, in most instances) to cover the cost of administering the program.

Foreign countries may also opt to procure directly from American contractors in Direct Commercial Sales, though FMS ensures third countries rates similar to those received by the DoD (bargaining power) but the items will be the standard procured by the USA, not especially tailored to the needs of other countries. In any case the sales will have to pass the same approval requirements for the sale of defense materials to third countries.

The Defense Security Cooperation Agency (DSCA) is the one managing this program and the one which publishes the different deals (Major Arms Sales Notification and FMS Contract Awards).

The DSCA also publishes historical data of the FMS sales by year and per country and region. (I have always admired the openness of the different US agencies in their publishing of data to work with).

In the graphic below you can see the total US arms sales agreements with foreign countries and FMS-program agreements during the last 40 years.

Total Military Sales (*) and FMS-program agreements (in k$) per year.
[(*) Total Sales includes foreign sales not made through FMS program]

You can see how most of the agreements are close within the FMS program, which ensures moderate costs to the third countries and a standardization for US allies. You can notice as well how the first Gulf war and the recent wars in Irak and Afghanistan have increased FMS agreements.

However, given that military equipment takes time to build, there is a lag between those sales agreements and when the arms are delivered. See below the two lines representing FMS agreements and FMS deliveries (both in k$).

FMS (in k$): agreements vs deliveries per year.

You can see how the deliveries show a growth trend since the 1970’s, with peak at the end of ’90s.

The following question is: to which countries were those sales…

FMS Sales (1950-2010) per region.

I will end this post with this graphic, showing how the Middle East (“Near East & South East Asia”) is the region which received the most of FMS during the last 60 years. In a following post I will dive into which specific countries as that is a very interesting analysis deserving a single post.

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