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France Loses Its Positions in the Arms Market

Category: Defence Industry

France is losing its positions in the world's arms market, being forced out by American, Russian and Israeli companies, says the Internet publication

According to Jean-PAul Pani, an employee of the Department for Procurement/Sale of Arms of the French Ministry of Defence, although the French still keep their third place in the world (after the USA and great Britain) as to scope of their weaponry sales, the French segment of the world's defence market is shrinking. This conclusion has been made by the Ministry's experts who studied the changes in the market in 2002-2003.

'The American export scope is now as large as it has never been before. Israel is quite aggressive in penetrating into the arms market', he said and also added that Russia also is quite busy looking for potential clients far beyond its traditional market in Eastern Europe.

According to the data given by the employee, between the years 1994 and 2003 France retained around 12 per cent of the market. The country's annual profit of arms sales amounted to around ˆ5 billion. However, in 2002 the profit reduced down to ˆ4.4 billion, while in 2003 – down to ˆ4.2 billion.

Pani added that the USA, Great Britain, France, Russia and Germany, if taken all together, carry out 90 per cent of the world's arms sales. In so doing, the first three countries retain the three thirds of the whole market. The remaining 10 percent are shared by Israel, China, Italy, Sweden and South Africa.

The largest clients of French companies include Saudi Arabia, United Arab Emirates, Greece, Great Britain, Pakistan and India. China also belongs to this list, however, according to the existing embargo, only non-lethal weapons can be supplied to China.

It is arguably because of France's difficulties in the international arms market that Paris is quite busy lobbying in the European Parliament the lifting of 'Chinese embargo', which the European Union plans to lift in the summer of 2005. However, the United States state an apprehension that this will enable the People's Republic of China to purchase the newest weapons and to use them against the neighbouring Taiwan (the Americans support Taiwan, while the Chinese believe that this island must be a part of the People's Republic of China). Washington's opposition to the lifting of the embargo is actively supported by Japan, which is sure that the European Union's decision of the kind can destabilise the situation throughout Eastern Asia.

France has already put forward a number of arguments which are supposed to persuade the sceptics that the lifting of the embargo is not so tragic as apprehended by the Americans. In particular, the French believe that China will not buy large numbers of weapons in Europe as, on the one hand, it has already bought a lot of modern weapons in Russia, and, on the other hand, the largest European defence-related companies will most probably impose some limitations themselves, because they have too much business interests in the United States and they will not risk their USA-related contracts by concluding defence-related contracts with China.

Besides, according to French Defence Minister Michel Alliot-Marie, the lifting of the embargo on arms supplies to China will entail the slowing-down of defence-related scientific research work in China. The Defence Minister has said that 'the lifting of the embargo is a better protection that the retaining of it", as the ban forces the Chinese scientists to develop the kinds of weapons which China is not allowed to purchase.

Sergyi Wey

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