Arms are not Tomatoes Arms production & trade among the ASEM countries

Martin Broek

Arms trade and arms production are not treated like other sectors of business and trade – neither ethically, nor economically. This is strongly underlined in Pentagon and European Commission texts. “This contract was not competitively procured” is the phrase constantly repeated on the Pentagon website.(1) Similarly, the European Union treats arms quite differently from other products, as is indicated in the ‘Everything but Arms’ initiative adopted in 2001.(2) While calls for trade liberalisation are loudly reverberating around the world and have resulted in major agreements on trade, arms production and arms trade are not subject to neo-liberal market ideology. Governments regard defence production as delivering the hardware for national armies and arms trade as providing military muscles to allies in other parts of the world. Therefore, arms production and arms exports fall under the framework of national sovereignty and protection, and are exempted in the free market trade regime. When a different approach is deemed necessary to protect vital national economic and political interests, the rules of the free market seems to be less sacrosanct. Thus while arms production and militarisation are an integral part of the neo-liberal paradigm of globalisation, arms trade is given a ‘grand exception status’ from the rules of the free market.

l. Military Expenditures, Arms Production and Arms Trade

In 2000, military spending worldwide reached the amount of US $800 billion. This amount will increase sharply during the first years of the new millennium, not least because of the expansion of the US military budget, which is almost as high now as it was during 1987, the year the Cold War expenditures reached its highest point. It is anticipated that the 1987 levels of military expenditure will be exceeded by the US budget in 2004. This trend is difficult to understand given the lack of real adversaries in the world towards Western domination. However the US is quite open about the reason behind this – it aspires to ‘full spectrum dominance’ in space, air, land and sea. We can also expect that Western Europe will follow the US example and wastefully invest more money on its military projects. As one participant in a European Peace conference recently remarked, “When the Secretary General of NATO opens his mouth he asks for more money”. Indeed a section of Europe’s elite’s is afraid they will be left behind, unable to parallel US military power and will not have the capacity “to safeguard Europe’s freedom of action in its external policies.(3)

Uneven distribution of power

The current global military expenditure of US$ 800 billion breaks down in predictable proportions as illustrated in graph 2. The US spent more than one third, the European NATO and EU countries one quarter and the rest (including countries like Russia, Japan, China and India) 40%. The military expenditures for 2001 indicate that the balance of power is even more weighed to the US and Europe. Approximately 25% of this military expenditure is spent on weapons (graph 1).

The largest amount, approximately 50% (4) is spent on salaries of military personnel and the rest on fuel, buildings, and food. This means world military production is approximately US$ 200 billion. This can be compared to the turnover of a transnational company like Shell. Defence production is often painted as a giant in financial terms. However, compared to other economic sectors it is not so enormous. Its real power lies not in its actual economic size but in its privileged connection to the state and seeing it only as an economic Goliath, may risk minimizing more substantive criticism.

Arms trade counts for 25 % of all weapons produced which means that arms valued at US$ 50 billion are sold across borders every year. This means then that most of the arms are thus produced for the home market. The alarming figures quoted for the top arms importers therefore reveal an incomplete story, since countries with huge arms production facilities within their territory are not listed. What is listed in such rankings are the recipients willing to invest large funds to import huge quantities of arms. This is related to their dependency on foreign supplies, because they do not have big domestic production facilities. For East Asia, Taiwan, South-Korea and China are ranked in the top five of world wide arms importers. These rankings of course point to regions and countries which are embarking on an arms race, but the United Kingdom for instance is spending much more on arms than the top five countries taken together.(5) When seen from the perspective of arms exports it becomes clear that the balance of power weighs to the Western hemisphere (graph 3).

Big Burden

Although arms production worldwide is not that large compared to other economic activities, military budgets are a big burden on government budgets, since arms are almost exclusively produced for and often financed by governments and paid out of state budgets. Governments are thus responsible for these expenditures and exercise direct influence on the allocation of financial resources. For some countries military expenditure accounts for much more e.g. Burma spends 40% of its state budget on the military and the US spend over 20% during the Clinton administration. If we consider that current military expenditure is as big as the income of half of the world population,(6) then the ongoing choices made by governments on the acquisition of military hardware is at the expense of people oriented development programmes.

ll. Arms Production, Exports and Control in the ASEM Process

Arms production and arms trade should be addressed within the political and security pillar of the ASEM process. Three of the EU ASEM countries are among the most prominent arms exporters – France, the UK and Germany. Of the top importers three countries are from East Asia: China, South Korea and Taiwan.(7) Only China is itself a significant arms exporter. However, the flow of arms trade is like a river going one direction – towards Asia. Despite the fact that some recipient states embarked long ago on the creation of a domestic defence industry, they are still dependent on importing supplies. There is an Asian as well as a European side to arms exports and production of the countries participating in the ASEM process, but this only tells a partial story. Significant differences exist both within and between regions. Europe is home to three of the ten biggest arms manufacturers worldwide. The Japanese Mitsubishi Heavy Industries with a military turnover of US$ 3.6 billion lies just behind the military industries from the US, the UK and France/Germany, making it by far the biggest arms manufacturer of Asia.(8) Arms production within both Europe and Asia is too diverse to be analysed as one single region. For instance, weapons production in South Korea cannot be compared with Cambodia and Greece (a top ten arms importer) and Germany are playing a very different role in the arms market. Furthermore, the provision in the Japanese constitution against arms trade is not matched in any of the EU countries. These differences indicate the need for further research in establishing the significance of the arms trade and arms production in the ASEM process and for identifying the arms trade connections between the European Union and Asia ASEM countries.

Enhanced Partnerships

In the European Commission Framework document for ‘Enhanced Partnerships between Asia and Europe’ the latest outline of Europe’s Asia policy is given. One of the few remarks on arms trade in the document identifies arms trafficking as a common concern on the level of Ministries of Justice and Home Affairs. Arms traffickers are working across boundaries and co-operation in this field is essential to tackle the illegal flow of arms. One example from 1999 illustrates how an Israeli businessman transported 40 armoured personnel carriers from Germany to Iran. The arms followed a route through the Netherlands, Britain and Singapore before reaching Iran.(9) The Israeli businessman was in close contact with a South Korean arms dealer known to sell arms to Iran. To tackle this kind of flows concerted action between law enforcement bodies of all involved countries is essential. The Framework document also states that co-operation should exist “for the early and comprehensive ratification of major international Instruments such as the Comprehensive Test Ban Treaty or the Conventions on small arms and anti-personnel mines.”(10) Regional and global security is certainly helped by an orchestrated implementation of those conventions. Landmines are a hidden killer and the removal of those weapons from the stocks of armies is essential for the security of those wanting to use the land for productive purposes such as agriculture, leisure and transport. Illegal small arms are causing death and destruction in all parts of the world and their wide distribution leads to killings by criminals, gangs and paramilitaries. The small arms convention is also addressing those used by resistance groups.(11)
The killings by armies, democratically controlled or not, are outside this Convention and so its implementation is limited to law enforcement and control by the government. The scope of arms control is too limited when it stops at the level of law enforcement and nuclear testing. Such an approach uses a narrow concept of security – that is military security.
Arms trade is a way of beefing-up allies, with consequences for regional balances of power and relations between nations and as such part of the conservative security debate. Moreover, major arms deals involving hundreds of millions or even billions of dollars of government expenditure cannot be left out of a genuine people’s oriented security debate. Arms trade and acquisitions are part of such a security debate and for this reason should be part of the Framework document.

Finance Packages and Debt

When the EU adopted a strategy on Asia in 1994, it clearly identified the increase in the ambitious armament programmes in the Asian region as one of the factors “which could disrupt world equilibrium and thereby impinging on Europe’s Common Foreign and Security Policy objectives.”(12) In the 2001 update of the Asia Strategy however, there is less attention to the security dimension of the relationship, with the exception of the issue of small arms trade and nuclear testing.

There can hardly be any justification for this omission. Although the impression exists that arms trade to the ASEM countries declined due to the economic crisis of 1997, this is not yet reflected in the figures given by SIPRI for 1999 (graph 4). Because the negotiations for arms deliveries in general take a long time it is possible that there will be a significant decrease visible in the near future. Another reason the economic crisis is not yet reflected in the figures, is that Arms companies made financial arrangements with governments and banks, such as low interest loans and favourable re-payment schedules to back up ongoing arms deals and negotiations. ‘Buy now, Pay later’ became the modus operandi of both arms exporters and importers. An official of the British Ministry of Defence explained it in this way: “In the United Kingdom, we view innovative financing packages as a key factor in any likely success”.(13) The Defence business was not willing to let existing deals collapse and used financial flexibility to secure additional new deals. Sales did not stop and some were merely postponed. This of course has led to further public debt. Conveniently, the international attention on the burden of debt on state budgets was put aside in order to continue arms trade.

Growing Demand

Besides, the long term effects of the crisis will be downplayed by new developments. Analysts see a growing demand for arms in South East Asia.(14) The Malaysian Defence Minister Najib Razak told the well attended Defence Services Asia (DSA) arms fair: “With the economy of most of these countries back on track there will be a projected increase in the defence expenditure to procure platforms, weapon systems and solutions to meet national requirements.”(15) Defence companies likewise felt rewarded for participating in the DSA 2002.(16) Malaysia alone ordered weapons valued US$ 958 million in April 2002. According to an Australian analyst, the process will go more rapidly in Southeast Asia than in the nineties: “Those that haven’t started to move with new fighters, new surface combatants, new subs, are very quickly going to.”(17) Issues raised in the nineties are very much back in the debates on arms trade in Asia. Is an arms race ongoing or not?. Do the acquisitions find their logic in modernisation, overhaul or refurbishment? Is it old shopping lists which now materialise? All these questions which had been set aside for five years are once again on the agenda. However, there are also new issues with the turmoil in Indonesia being an important new factor. What is not yet very much back in the discussion is the ASEAN Regional Forum (ARF) or any other initiative on genuine regional security co-operation. Military exercises with the US and Australia are the most developed forms of regional military co-operation at present. The absence of a multilateral framework for regional security co-operation seriously hampers confidence among the countries in the region and arms acquisitions of one country are followed by similar acquisitions by neighbouring countries.

9/11 Becomes a New Sales Pitch

According to Malaysia’s Defense Minister Razak when he defended the Malaysian arms acquisitions during the DSA arms fair “The 9/11 attack drastically changed the outlook toward national security”. By invoking the 9/11 terrorist attacks, he was joining those government leaders who have used the 9/11 events to popularize a new sales pitch for arms acquisitions. The strike on the World Trade Center and Pentagon is a weak rationale for placing submarines and fighter aircraft on the shopping list of many East and Southeast Asian countries. These are not the best weapons in the fight against terrorism. The current weapons acquisitions are high-tech buys demonstrated during the Second Gulf War on Iraq (1990-91). Furthermore, the latest orders and wish lists follow the images of US technology shown on the Afghan battlefield: the integration of remote operation, new observation techniques, state of the art Information Technology, improved precision guided munitions, and lasers. According to an Australian expert, “we will see increasing sophistication, not only of the platforms, the ships, tanks and aircraft, but of the weapon systems that go with them.”(18) The 9/11 attacks and the creation of US led coalition against terrorism provided the rationale for lifting arms embargoes and relaxing arms export policies on more advanced weapon systems as a reward to countries for their participation. This applied to the Middle East, South Asia, and also in Southeast Asia e.g. Indonesia. The restrictions on military co-operation between Jakarta and Washington (developed between 1994 and 2000) have been under pressure ever since. Likewise the Philippines has received 100 million US$ in military assistance, and has allowed the intervention of US Special Forces in Mindanao.
An additional factor for further militarisation in the region is Missile proliferation and the re-emergence of the US Star Wars programme – pushing military budgets ever higher. According to John Chipman, Director of the International Institute for Strategic Studies in London,(19) ” The nature of missile proliferation in the region holds in prospect the kind of arms race that was not seen in the first half of the 1990s.”

Defence Industry in East and Southeast Asia

The economic crisis of 1997 did change the picture of the defence industry in Asia. Domestic defence industries in Southeast Asia are opening their firms to foreign investment to build equity and market links with Western nations for capital, technology and markets.(20) Malaysia recently indicated that it wants to become a regional hub to help international defence firms to penetrate Asian markets and most of the ASEAN defence industries are eager to find a foreign partner to attract market access as well as capital. This path is also followed by South Korea. The French Thales company has a joint venture with Samsung.(21) Taiwan wants to build the submarines offered by the US in 2001 at the China Shipbuilding Corp. as well as import the technology from abroad.(22) All this is underlining dependence on Western funds and weapon technology, developed with large sums on Research & Development programmes (R&D) -estimated at US$ 39.3 billion in the US and at US$ 9.1 billion in Europe annually.
Singapore Technologies follows another route similar to what Western firms do – buying what it needs mainly in the US. This excludes the real state-of-the-art technology because this is prevented from foreign participation even by key allies. Of the six ASEAN countries which are producing small arms at home, only Singapore Technologies has a sound economic policy and export record. It exported ordnance, machine guns and assault rifles to a wide range of regions of tension. Other countries produce arms against higher market prices(23) – which has more to do with national pride than with sound economics and the rule of the market.
The Chinese defence industry still produces obsolete weapon systems. It is not yet able to start the reorganisation process demanded to generate the capacity needed for the technological advanced weapon systems which the Chinese military want to possess.
There has been little change in the Japanese weapons industry. However, as a result of the economic recession the Japanese car industry was opened up to foreign investment. Renault took this opportunity and its investment in Nissan resulted in the sale of the military division of Nissan Motor Corp. to Ishikawajima-Harima Heavy Industries. This reflects the imperative to keep arms production in Japanese hands.

Changing Defence Industry in Europe

Changes in the European defence industry have developed more quickly that predicted a few years ago. It has moved from a mainly national based industry towards an industry organised at the Europewide level. The European Aerospace Defence Space Company (EADS)(24), based in Germany, France and Spain, but with offices all over the world and connections to a wide number of other companies,(25) is one of the more prominent results of this European response.
The driving force behind the Europeanisation of the defence industry is a coalition of the major arms manufacturers, some of Europe’s member states and the European Commission. Arms control is not the concern of this coalition. Its main aim is to create an efficient way of manufacturing arms in different countries and thus mimimising opposition to its arms exports.(26) The central questions however, is how to control the policies and operations of these cross-border defence giants?
Effective opposition to this formidable arms coalition remains one of the most crucial challenges in Europe today. Currently, peace movements and NGO’s are too diverse to achieve a unified approach at this time. Perhaps the way ahead will come through building on national experiences and strengthening national and European control of arms exports, as well as co-operating with peace movements in arms importing countries.

lll. Arms are not Tomatoes

Arms production differs from the production of many other goods and it for this it is given “special treatment” status. During the G-8 meeting in 2000, arms exports were described as non-productive(27) – implying they have no function to improve the living conditions of people unlike food, mobile telephones or furniture. The G8 and World Bank and IMF(28) criticism on arms exports however is mainly focused on poor economies – mainly in the South. Similar criticism is not applied where most needed – in the capitals of the North where all major decisions on new armament programmes are made. Neither is this criticism applied to governments introducing new weapon systems in other regions of the world for example when European submarines were are sold to Southeast Asia (29) or when the US sells its Advanced Medium Range Air-to-Air Missiles (AMRAAM).(30)
Weapons manufacturing and arms trade are not a direct cause of conflict, but the availability of large amounts of arms makes the outbreak of conflict more probable and severely narrows the possibilities of seeking peaceful solutions to conflict. Moreover, the proliferation of arms directly impact on human rights violations and absorb huge proportions of state budgets. But it is too simplistic to just call for a stop on all arms production or call arms economically useless. We need to underline the connection between economic domination and the need of military force to defend it. Thomas Friedman has been very explicit about this when he remarks that “the hidden hand of the market will never work without a hidden fist.”(31) This inter-relationship between economic and military politics challenges peace, security and anti-arms trade groups to develop an alternative security paradigm focused on the wellbeing of people rather than on profits of the TNCs. This will also open up new possibilities of cooperation with other social movements, particularly the global movement for economic justice.

The “Different” Terrain of the Defence Industry

The debate on globalisation focuses on trade liberalisation in the WTO and on the role of multilateral financial institutions such as the IMF and World Bank. Locating the arms manufacturing industry in this context poses difficulties, since the defence industry is “different” and therefore gets “exceptional” treatment. Two significant aspects of this are:
the defence industry provides its products almost exclusively to governments unlike other industrial sectors, the defence industry is not subject to free-market rules. The defense industry is excluded from the WTO-trade agreements as well as from the European Union common industrial policy.(32) This is because the arms industry is considered by governments to be crucial for defending national sovereignity or political coalitions.
Because the arms industry is seen as a crucial part of defence and foreign policy it is heavily subsidised by governments, from the early stages of research to the end stage of guaranteed procurement for exports. This is also the main reason why the arms industry results in over capacity.(33) Arms are not primarily regarded as commercial products, but first and foremost as products for defending national interests and sovereignity. This is also why the bulk of arms are sold to the governments where the industry is based.(34) Although for the individual arms companies it is the profit factor which operates as in other industries. Besides, it is the enormous state subsidisation which enables these companies to produce at their current rates. The U.S. government spent US$ 39.3 billion on Research and Development in (R&D) in 2001,(35) while the turnover of the US defence industry is US$ 100 billion. In other sectors of industry this should lead to cuts in R&D allocations. Similarly, the proportion of funds allocated by the Export Credit Agencies (ECA’s) of France and the United Kingdom are excessive. Both forms of funding are used to create military advantages over adversaries. M

ilitarisation of the Economy

This nexus between the state and weapon manufacturers leads to militarsation in several ways. Because the military industry is excluded from free trade agreements, it gives governments the freedom for industrial policy. While the spin-off from the military to the civil sector is often mentioned as one of the positive effects of military production it is in reality quite minimal, since developments in the much bigger civil computer or aerospace industry are moving faster than the military sector. However a new form of spin-off takes place. Since all companies building military aircraft also have a large civil sector, subsidies for military aircraft, which is exempted from trade agreements – result in the development of technologies also used in the civil sector. Another effect of the fact that arms manufacturing is not subject to WTO rules or EU treaties and agreements is that governments can spend money on the defence industry as part of a policy to stimulate the economy. After September 11, the US government “approved $40 billion for the war against terrorism and $15 billion to bail out US airline companies. This amount equals 0.5 percent of the US economy – “a decent stimulus by historical standards and enough to nudge the economy from mild recession toward modest growth,”(36) according to the Minneapolis Star Tribune. When the arms products are ready the government buys the production or supports the export of the manufactured weapons, thus using military production and acquisitions as a stimulus to the economy. This so-called military kenysianism leads to a militarisation of the economy. In the 80s, when large amounts were spent on arms production, this led to capital shortage by some governments, particularly the US. Money was extracted from capital markets in Europe and Japan, leading to pressure on loans provided a decade earlier, with devastating results for countries in the South forced to pay back loans. Rules set by the WTO and the EU generally limit the possibilities of governments to determine their own policies. However, in the context of the military and defence industries governments retain the freedom to intervene and steer the wheel with the same result as in the WTO regulations – dominance over smaller countries.
But corporate policy is also present in the military sector, as was indicated in the discussion on the European defence industry. The influence of military corporations is growing in the European Union, partly because of the convergence of foreign policy and military interests aimed at the creation of a European military power, but also based on corporate ambitions. The rationale behind this type of development is most explicit in a US Defence Science Board (DSB) document ‘Globalisation and Security.’ This document calls for a more relaxed arms export policy, building higher walls around fewer but more advanced technologies and facilitating transnational mergers of defence corporations to achieve bigger profits.(37) The DSB document does acknowledge that its proposals may conflict with “foreign policy objectives, particularly those achieved by limiting foreign access to US defence technology, products and services,” but the interests of US defence industries are given precedence in the report. Limits on the freedom of operation by arms manufacturers are relaxed, giving companies more room to manoeuvre.

Towards Human Security

For quite some time now, the concept of human security has identified the necessity of a new development paradigm which puts people at the center of development. In 1994, the UNDP Human Development Report reflected this: “For too long, the concept of security has been shaped by the potential for conflict between states. For too long, security has been equated with the threats to national borders. For too long, nations have sought arms to protect their security. However, the majority of people today experience insecurity more from worries about daily food and susbsistence that from the dread of a cataclysmic world event. Job security, environmental security, security from crime, these are emerging concerns of human security all over the world.”(38) Throughout the 90s new issues of ‘insecurity” have emerged globally and a major impact of the Asian economic crisis of 1997 was the sense of insecurity caused by the runaway growth and spread of global capital flows (39) and the consequent devastating effects on millions of people. Human security was again put forward in the debate after the September 11 attacks: “The cost of failing to advance human security and to eliminate the fertile ground upon which terrorism thrives is already escalating. Since September 11, we know that sophisticated weapons offer little protection against those who are out to seek vengeance, at any cost, for real and perceived wrongs. Unless our priorities change, the threat is certain to keep rising in the coming years. But first, we must all understand that in the end, weapons alone cannot buy us a lasting peace in a world of extreme inequality, injustice, and deprivation for billions of our fellow human beings.”(40)
However, the September 11 debates put almost exclusive emphasis on military and repressive solutions. The US led war against terrorism prevailed over a well thought-out plan to counter terrorism and further marginalised Human Security discourse and initiatives.

Power Politics Overlooked

In addressing the security debate, the UNDP Report of 1999 is quite graphic: “The prospect of collective suicide through an impulsive resort to nuclear weapons was always exaggerated. But the real threat of global poverty affecting all human lives – in rich and poor countries is real and persistent.”(41) However this Human Security concept was developed in the optimistic atmosphere after the end of the Cold War and the peace dividend – now almost evaporated in the face of rising levels of military expenditure – was part of the budget composition for implementing a Global Human Security Fund.(42) But already when the report was written arms acquisitions in Southeast Asia were rising and NATO armies were re-organising towards more flexible and mobile military forces. The Report in fact failed to address the power politics and the forces working against the development of human security. On the other hand it acknowledges that the arms trade is unscrupulous in the face of poverty and arms are sold to conflict areas, thereby aggravating the causes of poverty.
As bigger portions of national budgets are being spent in arms production and procurement, ever-greater inequities between investment in arms and investment in people become more glaring. Two warships ordered by Malaysia from the UK “at a cost of US$ 661 million, could have provided water for nearly a quarter century to the five million people without safe water”. Likewise, it is estimated that the overall costs of the Joint Strike Fighter, developed by several countries of the North, will be US$ 500 billion.(43) At the same time 17 million people die each year because of poor nutrition and an unsafe environment – particularly from polluted water. Military budgets can be allocated to better ends than arms acquisitions in the South but even more so in the North.
It is not enough to criticize the ‘iron fist’ military policies if this is not combined with a sharply identified agenda of people’s oriented security. Global poverty is no accident, but the result of the current neo-liberal policy regime – which is enforced by military might when deemed necessary. It is this power politics which is at the core of the ‘real threat’ to our human security. To create genuine security the most protected should not be the arms industry, but the people.
Despite the limitations in the concept, human security creates new opportunities to connect peace and security agendas to the agenda of the movement for a just and social globalisation. We need to reclaim security from the military and make people not arms the first security consideration. In its preparation for the World Summit on Sustainable Development,(44) the South African Cease Fire campaign urged people to participate actively in this debate and challenge insider military security experts’ assessments of security and justification of military budgets. Creating genuine security, means protecting the people and not the arms industry.
In the face of the abandonment of the peace dividend by governments after the ending of the Cold War, peace movements, and people’s organisations in different parts of the world have persisted in highlighting the centrality of a Human Security paradigm. In Asia, a number of ground-breaking initiatives are being developed such as the recent Asian Peace Assembly (45) and proposals are also being developed on alternative structures for regional security in Asia Pacific.(46) Human security and people’s security is also emerging strongly in the peace agenda of the World Social Forum process and in the regional forums being prepared in Asia and Europe.

About the Author: Martin Broek is a researcher working at the Campagne tegen Wapenhandel in Amsterdam. He has published several articles on the arms trade and monitors trends in security developments in Europe and Asia. He was editor of ‘Indonesia: arms trade to a military regime’ (Amsterdam: European Network Against Arms Trade (ENAAT) 1997); he also contributed an article ‘Europe’s Defence Industry and its Arms Trade with Asia Pacific’ to a TNI publication ‘Europ-Asia Arms Trade: Challenges ASEM Security Dialogue’, 1998. Endnotes:

  1. The US website is used because the Americans are most open on arms sales and acquisitions.
  2. Everything but Arms. The name of the European programme is more on the level of PR and propaganda. The 48 poorest countries are not much a threat to European arms manufacturers and the words ‘but arms’ does not mean much.
  3. Star 21: ‘Strategic Aerospace Review for the 21st century; Creating a coherent market and policy framework for a vital European industry,’ European Commission Enterprise publications, July 2002. Star 21 brings together five of the EC commissioners with competence on the issue, the EU high Representative for the Common Foreign and Security Policy and six CEO’s of leading European defence firms.
  4. NATO military expenditure tables 1991-2000 (
  5. Taiwan 12.281, Saudi Arabia 8.362, Turkey 5.664, South Korea 5.334, China 5.231 US$ million (constant 1990) in 1996-2000. The UK spend 48.349 million US $ in the same period. Imports where only 1.694 of this amount (3.5%).
  6. Human Development Report (HDR) 1994
  7. Taiwan is not part of the ASEM process, but important enough to mention in the context of security in East Asia.
  8. ‘Defense News top 100,’ Defense News no. 30, 30/07-05/08/02
  9. Margot Dudkevitch, ‘Two remanded for selling arms to Iran,’ The Jerusalem Post Internet Edition, 03/02/00.
  10. Communication from the Commission: Europe and Asia: A strategic Framework for Enhanced Partnerships, Brussels 04/09/01 (COM 2001 469 final), p. 18.
  11. ASEAN is not very efficient controlling small according to the Centre for Strategic and International Studies in Jakarta, Philips J. Vermonte, ‘ASEAN needs to address illegal trade in small arms,’ Jakarta Post 16/04/02
  12. Communications from the Commission: Towards a New Asia Strategy, Brussels 13/07/94 (COM(94) 314 final, p. 11.
  13. E.g. Barbara Opall, ‘Sellers exercise flexibility amid Asian money bind,’ Defense News no. 9, 02-08/03/02
  14. Joshua Kurlantzick, ‘Nations increase Military Spending,’ Washington Times 16/10/00; ‘Arms Spending in S-E Asia; More bucks for the Bang,’ Straits Times 21/04/02
  15. ‘Defense spending across Asia will Rise, predicts Malaysian Minister,’ The News Jang Group (internet version) 09/04/02.
  16. Arms spending in S-E Asia; More bucks for the bang,’ Straits Times 21/04/02 (internet version)
  17. Dan Eaton, ‘Signs of recovery trigger Asian arms buying spree,’ Reuters 14/04/02.
  18. Ibid note 15.
  19. Ibid note 13.
  20. Philip Finnegan, ‘Asian Firms Reach out for Foreign Investment,’ Defense News 08/07/00 This article gives an overview of defence industry developments across East and Southeast Asia and is used for this part on Asian defence industry.
  21. South Korean development however should not be overestimated. Jenny Franco, Martin Broek, ‘Up in arms; Europe’s Arming of South Korea and its implications for peace in East Asia’, TNI: Amsterdam 2000, p. 23-24. Also: Martin Broek, ‘Südkoreas wichtigste Rüstungsprogramme; Der Alptraum von Akte X,’ Korea Informationen, no. 1, 2001 .
  22. It remains to be seen wherefrom, since none of the manufacturers of state-of-the-art submarines want to jeopardise their economic relations with China by offering Taipei this kind of technology.
  23. Dan Eaton, ‘Future Brightens for Southeast Asian arms makers,’ Reuters 29/05/02
  24. E.g. EADS Ethical Shareholders’ Report 2002, Group of Ethical Shareholders of EADS supported by ENAAT (European Network Against Arms Trade), Forum voor Vredesactie and Campagne tegen Wapenhandel, April 2002.
  25. For an overview of links between different companies: “European Aerospace and Defence Cross shareholdings,” Military Technology September 2001, pp. 43-45
  26. The Star21 report is the latest example of this co-operation by the European Commission and the defence industry. (see note 3).
  27. Philip Finnegan, ‘Critics Blast U.S. Shift in Policy Regarding Advanced Medium Range Air-to-ir-Missiles (AMRAAM) in Asia,’ Defense News 07/03/00 for a critique on selling AMRAAM to Singapore, Taiwan and Thailand.
  28. ‘IMF Suggests Southeast Asia Review Defense Budgets,’ Arms Trade News February 1998 ; Patricia Adams, ‘Odious Debts; Money for the Military,’ 1991 ( chapter12.html)
  29. Michael Richardson, ‘East Asian Acquiring Submarines to Guard Sea-Lines,’ IHT 15/01/01
  30. See: Philip Finnegan, ‘Critics Blast U.S. Shift in Policy Regarding Amraams in Asia,’ Defense News 07/03/00 for a critique on selling AMRAAM to Singapore, Taiwan and Thailand.
  31. Thomas Friedman, The Lexus and the Olive Tree (New York: Farrar, Straus Giroux, 1999), p. 50. Also: Steven Staples and Miriam Pemberton, FPIF Policy Report, 24/04/00, ‘Security Exception’ & Arms Trade
  32. GATT Security Exceptions: “Nothing in this agreement shall be construed to prevent any contracting party from taking any action which it considers necessary for the protection of its essential security interests relating to the traffic in arms, ammunition and implements of war and to such traffic in other goods and materials as is carried on directly or indirectly for the purpose of supplying a military establishment.” [GATT 47 Article XXI (b) (ii)] Article 296 (ex Article 223) in the treaty establishing the European Community: (1b) any Member State may take such measures as it considers necessary for the protection of the essential interests of its security which are connected with the production of or trade in arms, munitions and war material; such measures shall not adversely affect the conditions of competition in the common market regarding products which are not intended for specifically military purposes. 2. The Council may, acting unanimously on a proposal from the Commission, make changes to the list, which it drew up on 15 April 1958, of the products to which the provisions of paragraph 1(b) apply.
  33. Dr. Neil Cooper, mentions 30-50%, see: ‘How the UK government subsidises the business of death,’ CAAT June 1997.
  34. Almost 80% of the UK Ministry of Defence’s equipment is bought within the UK, a further 12% is spent on collaborative projects and 9% is spent overseas. Ian S. Goudie, ‘The restructuring of the UK Defence Industries,’ Arms Conversion Project. Even a small country with a much smaller arms industry like the Netherlands is spending an average 50-60% of its acquisition budget at home. See: Letter Minister of Economic Affairs Joritsma, ‘jaarrapportage compensatiebeleid [yearly overview off-set policy],’ ID/CMP/99009688 September 1999.
  35. Gopal Ratham and Amy Svitak, ‘How Europe Can Close the gap,’ Defense News 05-11/08/02, p. 1
  36. ‘Now the economy,’ Star Tribune, Minneapolis 23/09/01, distributed by “mil-corp”
  37. ‘The Arms company of the future: BoeingBAELockheedEADS, Inc? USG Ponders Defense Globalisation,’ Arms Trade News no. 42 (January 2000), Federation of American Scientists. An article describing the growing role major EU and US arms producers take a leading role in the Transatlantic Business Dialogue (TABD) may be analysed in this light. Corporate Europe Observer – Issue 11, May 2002 (
  38. ‘Overview; An agenda for the Social Summit,’ UNDP Human Development Report (HDR) 1994, p. 3
  39. ‘Overview: Globalisation with a human face,’ HDR 1999, p. 3-4 and Chapter 1: Human Development in this age of globalisation,’ HDR 1999 p. 37-41.
  40. Michael Renner (Worldwatch Institute & TFF associate) and Dick Bell (Worldwatch Institute), 19/10/01 (
  41. HDR 1999, page 24. In Chapter 3: Capturing the peace dividend, p. 49 this statement is refuted.
  42. The fund of 250 billion US$ would be financed by: a) a portion of the peace dividend (US$ 14 billion); a 0.05% tax on speculative capital movements (US$ 150 billion); energy tax (US$ 66 billion); and US$ 20 billion from official development aid. HDR 1999, p. 18.
  43. Among the main Joint Strike Fighter ‘partners’ are: US, UK, Italy, The Netherlands, Denmark, Norway and Turkey.
  44. E.g. Jacklyn Cock, Nan Cross and Rob Thomson, ‘Militarisation: the Environment and sustainable development,’ c Ceasefire Campaign 24/04/02 (
  45. An Asian Peace Assembly was convened in Manila (August 30-September 1, 2002) bringing together peace movements, social movements, human rights organisations, activists and scholars to address the current issues of Peace and Security in the region.
  46. Kimura, Ehito, Approaches to a New Security Framework in Asia Pacific in Europe-Asia Arms Trade Challenges ASEM Security Dialogue, (Amsterdam:Transnational Institute 1998).