Europe's Fresh Arms Supply Commitments Boost the Coffers of American Arms Makers

  • Updated

Yet another report has underscored that US military-industrial complex is the biggest beneficiary in the arms sale surge triggered by the Ukraine war.

European Union nations have committed fresh arms supply worth $230 billion for Ukraine as the war enters the ninth month. The lion's share of the massive defense contracts has been gobbled up by American defense companies, according to the Stockholm International Peace Research Institute (SIPRI).

Raytheon Technologies Corporation
Raytheon Technologies Corporation is an American multinational aerospace and defense conglomerate headquartered in Waltham, Massachusetts. Twitter/ Wall Street Journal

Major European allies of Ukraine have all been buying weapons from American defense contractors. For example, some 95 percent of the weapons purchases by the Netherlands are from the US firms, while 83 percent of Norway's foreign weapons purchases were from the US. In the case of the UK and Italy these were 77 percent and 72 percent, respectively.

Rising Arms Imports in EU

European weapons imports rose sharply by 19 percent in the last five-years, RT reported citing data. The war in Ukraine is set to increase the US arms sale to Europe sharply, leaving US arms makers to receive windfall gains.

This is certainly the biggest increase in defense spending in Europe since the end of the Cold War ... They're waking up to the fact that not only is it very possible, but it is happening, and it's happening not that many miles away from them," Ian Bond, director of foreign policy at the Center for European Reform, told Yahoo.

US defense contractors will also benefit from Washington's massive military aid to Kiev, as the Pentagon races to replenish stocks of artillery pieces, rocket launchers and other weapons. Biden has set aside more than $65 billion in military and economic aid for Ukraine since the conflict began.

Lockheed Martin
Lockheed Martin is reportedly the major contractor for US’ $620 million package to upgrade Taiwan's Patriot surface-to-air missiles system Lockheed Martin Corporation

While US President Joe Biden professes championing the free world, his commitment to boost Ukraine's arsenal is directly benefiting American arms makers.

Apart from European allies, the US government itself is renewing huge arms and ammunition orders given to giant defense equipment makers.

Because, as Kirby said, the US inventory is flowing into Ukraine. Not just the US, dozens of European nations are engaging in the funneling of weapons into Ukraine.

Rise in Defense Stocks

Share prices of defense companies started climbing when war clouds gathered in Europe following Russia's military buildup near the Ukraine border. A day after the US and NATO warned Europeans to leave Ukraine, the defense stocks saw a steep rise even as the broader stock markets fell.

Stocks of fighter jet manufacturer Lockheed Martin, aerospace specialist rival Northrop Grumman, aerospace ad defense contractor Raytheon, aviation and ship building giant General Dynamics, all rose after the war started.

This article was first published on November 6, 2022