Analysis: U.S. arms sales to Asia set to boom on Pacific "pivot"

Tue Jan 1, 2013 10:19am EST
 

By Jim Wolf

WASHINGTON (Reuters) - U.S. sales of warplanes, anti-missile systems and other costly weapons to China's and North Korea's neighbors appear set for significant growth amid regional security jitters.

Strengthening treaty allies and other security partners is central to the White House's "pivot" toward a Pacific region jolted by maritime territorial disputes in China's case, and missile and nuclear programs, in North Korea's.

The pivot "will result in growing opportunities for our industry to help equip our friends," said Fred Downey, vice president for national security at the Aerospace Industries Association, a trade group that includes top U.S. arms makers.

Demand for big-ticket U.S. weapons is expected to stay strong for at least the next few years, the trade group said in a 2012 year-end review and forecast released in December.

Fears resulting from China's growing military spending should lead to enough U.S. sales in South and East Asia to more than offset a slowdown in European arms-buying, according to the forecast.

The trade group, whose members include Pentagon suppliers Lockheed Martin Corp, Boeing Co and Northrop Grumman Corp, did not put numbers to its 2013 forecast. Nor did the Pentagon's Defense Security Cooperation Agency, which has overseen a boom in worldwide deals under President Barack Obama.

The security agency, in response to a Reuters request, said sales agreements with countries in the U.S. Pacific Command's area of activity rose to $13.7 billion in fiscal 2012, up 5.4 percent from a year before. Such pacts represent orders for future delivery.

In 2012 there were about 65 notifications to Congress of proposed government-brokered foreign military sales with a combined potential value of more than $63 billion. In addition, the State Department office that regulates direct commercial sales was on track to receive more than 85,000 license requests in 2012, a new record.   Continued...

 
BF-3, a short take-off and vertical landing F-35 Lightning II, releases an inert 1,000 lb. GBU-32 Joint Direct Attack Munition (JDAM) separation weapon over water in an Atlantic test range in Patuxent River, Maryland August 8, 2012. REUTERS/Andy Wolfe/Lockheed Martin/Handout