US arms and military equipment exports hit record high $238 billion in 2023

News, US January 31, 2024 , by IRIA No Comments

The United States military equipment sales to foreign governments saw a 16% increase in the fiscal year 2023, reaching a record $238 billion, the U.S. State Department reported on January 29, 2024.

The major driver behind this surge is the war in Ukraine, with the supply of weapons to Ukraine from Western countries playing a pivotal role in boosting arms sales for the U.S.

The $238 billion figure includes the direct military sales by U.S. companies that reached $157.5 billion in 2023 and the sales arranged through the U.S. government that rose to $80.9 billion in 2023.

Arms sales and transfers are viewed as “important U.S. foreign policy tools with potential long-term implications for regional and global security,” the State Department said in a statement.

Foreign governments can typically procure arms from U.S. companies through two primary channels, Direct Commercial Sales, which involve negotiations with a company, or Foreign Military Sales, where a government usually engages a Defense Department official at the U.S. embassy in its capital. In both cases, approval from the U.S. State Department is required before the sale is finalized.

Foreign Military Sales reach $80.9 billion

The total value of transferred defense articles, services, and security cooperation activities conducted under the Foreign Military Sales (FMS) was $80.9 billion. This represents a 55.9% increase, up from $51.9 billion in fiscal year 2022. This is the highest annual total of sales and assistance provided to the U.S. allies and partners, the State Department said in a statement.

The statement added that the FMS approved in the year included $10 billion worth of High Mobility Artillery Rocket Systems (HIMARS) to Poland, $2.9 billion worth of AIM-120C-8 Advanced Medium-Range Air-To-Air Missiles (AMRAAM) to Germany, and National Advanced Surface to Air Missile Systems (NASAMS) to Ukraine.

*^{National Advanced Surface to Air Missile System developed by Kongsberg Defence & Aerospace and Raytheon. (Image Credit: Kongsberg)}*

Poland, Germany, Australia, Canada, and other Western NATO allied nations were among the top buyers of the U.S.-made military equipment.

The overall sum comprises $62.25 billion in arms sales financed by U.S. allies and partner nations, $3.97 billion through the Title 22 Foreign Military Financing program, and $14.68 billion funded through various Department of State and Department of Defense initiatives, which encompass the Ukraine Security Assistance Initiative, with an allocation of approximately $12 billion.

Direct Commercial Sales rose to $157 billion

Direct Commercial Sales (DSC) accounted for more than $157.5 billion in the fiscal year 2023. Some of the most prominent DCS of military equipment in the year 2023 are listed below:

$2.8 billion sale to Italy for the manufacturing of F-35 wing assemblies and sub-assemblies
$1.8 billion sale to India for the manufacturing of GE F414-INS6 Engine hardware
$1.2 billion sale of F100 propulsion system and spare parts to the Republic of Singapore, and the Ministry of Defense
$1.2 billion sale of F100 propulsion system and spare parts to the Republic of Korea Ministry of National Defense
$1.2 billion sale of the National Advanced Surface to Air Missile System (NASAMS) to the Norwegian Ministry of Defense. The missiles were provided to Ukraine
$1 billion sale to the Kingdom of Saudi Arabia for Patriot Guided Missile

^{The northern lights glow behind a Patriot launcher during Exercise Arctic Edge 2022 at Eielson Air Force Base, Alaska, March 5, 2022. The equipment was integrated during the exercise for simulated air and missile defense in austere arctic environments. (Image Credit: U.S. DoD)}

Lockheed Martin, RTX (formerly known as Raytheon), and General Dynamics, the leading U.S.-based arms manufacturers, are still working to complete the existing orders for hundreds of thousands of artillery rounds, and hundreds of Patriot missile interceptors.

The State Department report suggests a surge in orders for armored vehicles in coming quarters due to the increasing global instability, forecasting a further increase in military sales for the ongoing fiscal year.