The Russian invasion of Ukraine and geopolitical tensions in the world created strong demand, but many European and American manufacturers failed to significantly increase production capacity.
The income of the leading arms manufacturers decreased slightly in 2022 since they could not keep up with demand with their capacities, the Swedish institute SIPRI reported, writes dpa, reports Hina.
The income of the 100 leading producers decreased last year by 3,2 percent, to 597 billion dollars, calculated by the Stockholm Institute for International Peace Research (SIPRI).
The Russian invasion of Ukraine and geopolitical tensions around the world have created strong demand, but many European and American manufacturers have failed to significantly increase production capacity due to labor shortages, rising costs and supply disruptions, the institute explains.
"On top of that, countries delivered new orders towards the end of the year, so the surge in demand due to the time gap between orders and production was not reflected in the companies' revenues in 2022", they add.
Weaker results of American and Russian companies
They attribute the lower income in 2022 primarily to the weaker results of American and Russian companies.
The revenue of US arms manufacturers decreased by 7,9 percent last year, to $302 billion, mainly due to procurement problems and labor shortages, they found.
Data on Russian companies is "extremely" limited and only two are included in the report, with a 12 percent drop in revenue to $20,8 billion, according to the Swedish institute.
European manufacturers increased revenue by 0,9 percent, with Airbus and KNDS the main source.
Growth in the Middle East
The strongest growth was experienced by companies in the Middle East, by 11 percent, to 17,9 billion dollars, SIPRI calculated. Turkish producers stood out with the highest growth rate, of 22 percent, and Israeli producers with the highest amount, of 12,4 billion dollars.
"Middle Eastern companies specializing in technologically less sophisticated products managed to increase production in a shorter period of time and respond to strong growth in demand," explains SIPRI researcher Diego Lopes da Silva, singling out Turkey's Baykar, producer of the Bayraktar drone.
"Many arms manufacturers have had problems adapting to high-intensity warfare," adds Lucie Beraud-Sudreau, director of SIPRI's weapons research department.
American companies kept the first place with a half share in the total revenue, and in second place is a group of Chinese companies with a share of 18 percent.
ZS/Al Jazeera
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