Military exports rise to $6.5 billion

Islamist attacks in Europe, North America drive increase in demand

Military exports grew by $800 million in 2016, bringing in $6.5 billion, SIBAT, the military exports unit of the Defense Ministry, said on Wednesday.

SIBAT director Brig.-Gen (res.) Michel Ben-Baruch said the majority of the new contracts comes from increased defense budgets in European and North American countries, due to the increased focus on terrorism following dozens of attacks on the two continents by “lone wolves” and Islamic State supporters.

“The increase in the volume of new contracts signed expresses a global trend of pulling out of the recession, especially in Europe and North America, and increased defense budgets in the face of

growing security challenges,” read a statement by SIBAT.

These dozens of significant contracts allowed “the continued trend of strengthening Israel’s place in the global defense market,” it continued.

Speaking at the Israel HLS & Cyber conference in Tel Aviv in November, Ben-Baruch said that in 2017, “the Ministry of Defense will invest a special effort in promoting Israel’s military and protective cyber capabilities abroad.”

The largest share of defense exports went to the Asia Pacific region, for a total of $2.6b., followed by Europe at $1.79b., North America with $1.265b., Latin America at $550m. and Africa with $275m.

Within Asia, India has become a key market. Over the last five years, defense trade between the two countries has averaged more than $1b. With the two countries celebrating 25 years of diplomatic ties, New Delhi will be sending more than 50 companies to take part in ISDEF, the leading international defense and homeland security trade show, in Tel Aviv in June.

“The Israeli defense industries have won great prestige around the world, thanks to advanced quality technology. We are proud to conclude a challenging and successful year for the Israeli defense industry. We succeeded in working together to bring about a significant increase in the volume of defense exports,” the SIBAT statement read.

In 2016, aircraft and aerial system improvements accounted for 20% of exports. Observation and optronics (18%) came next; and then aerial defense (15%); ammunition and weapons stations (13%); radars and electronic warfare (12%); information and intelligence (8%); unmanned aerial vehicles (7%); telecommunications (4%); maritime (1%); and other (2%).

Lior Konitzki, deputy director-general of the Israel Export and International Cooperation Institute, quoted in a November report by Globes, said that in 2015, defense exports totaled $5.6b, with an estimated 20% related to homeland security.

Pieter Wezeman, senior researcher with the Stockholm International Peace Research Institute’s Arms and Military Expenditure Program, said in a recent interview with The Jerusalem Post that, while Israel is not in “the league of major importers, it is one of the larger arms exporters,” ranking 10th in the world.

The statistics compiled by the Swedish institution, which has monitored international arms transfers since 1969, are based on the transfer of major arms, not small arms, ammunition or electronic arms components, which are harder to track; otherwise, Israel would likely have ranked even higher, Wezeman said.

According to the February report by Stockholm International Peace Research Institute, arms imports across the entire Middle East surged by 86% between 2012 and 2016, accounting for 29% of global arms purchases, an increase of almost 100% from the previous five-year period.

The flow of arms to the Middle East, Asia and Oceania is thought to be spiking, fueled in part due to conflicts raging in the Middle East and tensions in the South China Sea. •