Western arms manufacturers are vying to cash in billions of dollars in sales in the “gold rush” created by Russia’s invasion of Ukraine and the likely increased militarization of Europe that will follow, industry experts say.
The United States and other Western nations are already providing large sums of money to help Ukraine defend itself in the short term and facilitate the acquisition of weapons such as the Stinger, Javelin and Stormer missile systems.
Companies like Raytheon Technologies have raised their stock prices by up 15 percent in the past six months as she and other giant armsmakers attend secret meetings with the Pentagon to see how they can take advantage of Ukraine and its charismatic president. Vladimir Zelensky to arm himself against the Russian invasion.
In Britain, the Ministry of Defense recently hosted a visit by Ukrainian officials and arranged for them to travel to the Salisbury Plain military range to see the Stormer missile in action.
However, experts say that while these initial sales represent only modest opportunities for arms companies, this is the prospect of an increasingly militarized Europe in the coming years and decades, where the real reward will lie. This is something that senior arms manufacturers are already talking about when addressing shareholders and the business media.
Nations, including Germany, fundamentally pacifist since the end of World War II, are now seeking to reshape their entire army as a result of Russia’s actions.
Germany has already ordered 35 F-35 fighters, the world’s most advanced fighter jet, from US manufacturer Lockheed Martin.
The move came after German Chancellor Olaf Scholz said Berlin would increase its military spending by a one-time payment of $ 113 billion and pledged 2 percent of its annual arms budget.
“By attacking Ukraine, Putin is not just trying to eradicate a country from the world map, he is destroying the European security structure,” Scholz told German lawmakers in February, the biggest change in its foreign policy in 70 years.
Zelensky accused Russia of terrorizing civilians in southern Ukraine
William Hartung, an expert on the international arms trade, told The Independent that the opportunities were a “gold rush” for the industry.
“They can earn in so many ways,” Hartung said.
“The [Biden] the administration has spent about $ 3.2 billion on arms aid to Ukraine, and although much of it is from current stockpiles, all of it will be replenished. through Pentagon agreements. They can also replace some of the weapons supplied by the Allies. “
He added: “And then, when Europe starts spending more, American companies will benefit.”
Hartung, author of Prophets of War: Lockheed Martin and the creation of the military-industrial complex and senior research fellow at the Quincy Institute for Good Governance, said arms manufacturers were already expecting a winning year before the invasion.
Still, Putin’s decision to invade Ukraine and scare some NATO and other European countries into thinking they might be his next target has given the industry a huge boost.
While individual companies have done well as a result, the whole sector is benefiting; in the United States, S & P’s aerospace and defense fund saw an increase of at least 11 percent.
Shipments of Javelin anti-tank missiles, manufactured by both Raytheon and Lockheed Martin, arrive from the United States at Borispol Airport near Kyiv
(Getty)
In an article written by Hartung and Julia Gladhill, an analyst at the Washington-based Project On Government Oversight Defense Information Center and published by Common Dreams, the couple quoted Gregory Hayes, CEO and chairman of Raytheon Technologies. bragging about the profits his company had to make as a result of the conflict.
“We do not apologize for making these systems, we made these weapons. “The fact is that they are incredibly effective in deterring and dealing with the threat that Ukrainians see today,” Hayes told the Harvard Business Review a month after the invasion.
“I think I admit again that we are there to defend democracy, and the fact is that we will eventually see some benefit in business over time.
Hartung told The Independent that many arms dealers seek to embrace ideas of democracy when presenting their products. However, he says most are fully transactional and happy to sell weapons to authoritarian regimes such as Saudi Arabia and Nigeria.
Last week, the Pentagon downplayed a secret meeting between top officials of eight major arms manufacturers – Boeing Defense, Space & Security, L3Harris Technologies, Raytheon Technologies, BAE Systems, Lockheed Martin Corporation, Huntington Ingalls Industries, General Dynamics and Northrop Grumman.
Defense Ministry spokesman John Kirby told reporters that this was “part of a normal, planned, routine conversation.” But the meeting was attended by the CEOs of the companies and the talks were secret.
Asked about what was being discussed, the Pentagon sent a statement to The Independent saying the meeting was chaired by Deputy Secretary of Defense Dr. Kathleen Hicks, who told chief executives that “the Biden administration is working around the clock to fulfill priority requests for security assistance to Ukraine, withdraw weapons from US stockpiles when available, purchase directly from the fast delivery industry to Ukraine, and facilitate the transfer of weapons from allies and partners when their systems respond better to the needs of Ukraine. “
Ukrainian President Vladimir Zelensky has passionately called on the West to arm his nation
(EPA)
In March, the Biden administration proposed a $ 813 billion Pentagon budget for 2023, a 4 percent increase from the $ 31 billion 2022 spending package the president signed the same month. Congress is likely to add to that figure, as it did in 2022.
The British government is also holding meetings with representatives of the defense industry and is hosting representatives from Ukraine to demonstrate the alleged mastery of armored missile launchers, known as Stormers, manufactured by BAE Systems Platforms and Services.
A spokesman for the UK Ministry of Defense confirmed that the weapons were shown during a visit to Ukrainian authorities. Britain has reportedly agreed to send weapons to Ukraine.
“During the visit, the 3rd Division of the British Army and the Royal Marines demonstrated a range of equipment and options for further military support, including defense missile systems and protected mobile vehicles,” the Defense Ministry said.
This will not be the first time the UK government has used a real conflict as an opportunity to showcase British-made weapons.
In 2011, when Britain, as part of a consortium of four countries behind Eurofighter Typhoon, was trying to strike a $ 11 billion deal with India on 126 aircraft, it hosted Indian journalists at events such as RAF Fairford in the South. England.
Anti-aircraft missiles in the sky a few miles from Kyiv on March 14, 2022 – in the third week of the Russian invasion of Ukraine
(AFP / Getty)
They told reporters that the Eurofighters had “surpassed” France’s Dassault Aviation Rafale in firing on former Libyan dictator Muammar Gaddafi’s forces. In the end, India bought the planes from France.
Asked about sales to Ukraine, a BAE Systems spokesman said the company “does not comment on customer transactions”.
Asked about the industry’s profit from the gold rush, the spokesman rejected the assessment and said: “We continue to work closely with our government clients to understand and support their demands.”
Raytheon Technologies did not respond to inquiries.
A spokesman for Lockheed Martin quoted recent public comments by CEO Jim Tyclet as saying that “the world has obviously changed with Russia’s invasion of Ukraine.”
“A great global power has crossed a recognized international border to seize territory by force, and as a result, the value of strong deterrence as an instrument of the nation’s geopolitical strategy has not been so great since the mid-20th century,” he said. .
“So here at Lockheed Martin, we are aggressively and aggressively positioning our company as a deterrent company using the F-35 and our other major platforms as guides.”
In 2011, the United Kingdom used a military operation in Libya to show Eurofighter Typhoon to potential Indian customers
(Getty)
Russia’s invasion of Ukraine has seriously complicated and hampered the work of those fighting for diplomatic solutions to such conflicts.
In March, the UK-based Anti-Arms Campaign (CAAT) issued a statement condemning Russia’s invasion of Ukraine and saying it appeared to have committed war crimes.
“However, we reject calls for increased militarization of Europe in response. “Militarism has created this crisis and further militarism is not the solution,” he added.
“NATO’s European members are already spending almost five times more than Russia on their military, and Russia’s military prowess has been proven far from what many believe.
CAAT research co-ordinator Samuel Perlo-Freeman told The Independent that his group did not “want to see a return to Europe from opposing armed camps”.
“The West is still extremely militarily more powerful than Russia. We need to look for ways to de-escalate this situation. With Putin in power, this is not an easy issue, “he said.
“But the longer we have this heightened state of vigilance, increased militarization, with Russia seeing a much more powerful West on its doorstep and NATO and the West seeing an extremely aggressive and militaristic Russia, this is not a good recipe for how things can go. turn around ”
He says, while his group is horrified by the atrocities in Ukraine, “we must be …
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