SIPRI - Trends in International Arms Transfers

[OPSSG]

In March 2010, the Stockholm International Peace Research Institute (SIPRI) released their report on 'Trends in International Arms Transfers, 2009' (SIPRI Report 2009) and news organisations looked at the report and duly cited a few of the 'juicy numbers' in the report without thinking.

Apparently, if you actually examine the data more closely, you will find that, in some cases, the conclusions that the news organisations drew from the report are without basis. There are lies, dammed lies and statistics. The selective presentation of data from a limited data set from a specific time period is misleading.

Let's start with the BBC's article on the SIPRI Report 2009 and quoted below:

'Arms drive' in South East Asia

15 March 2010 - South East Asian nations are ramping up their military capacity in a move that could destabilise the region, a new report says. The report comes from the Stockholm International Peace Research Institute. It says that arms imports by Indonesia, Singapore and Malaysia leapt by 84%, 146% and 722% between 2005 and 2009, compared with the previous five years.

Analysts put this down to the regional arms race, the need to replace old weapons and the growing might of China. There have long been concerns in this part of the world about how quickly China is ramping up its army and naval forces. Just a decade ago, the Chinese government spent less than $10bn (£6.6bn) dollars on its weapons supplies. Today that figure is closer to $80bn.

So it is no surprise military analysts say that countries like Singapore, Indonesia and Malaysia are also keen to show off their military strength. But in comparison to China's might, their arms purchases are insignificant. It is not just because of China, though, that South East Asian nations are adding to their armies.

According to analysts, these countries have always harboured a deep-seated suspicion of their neighbours - so when one sees another spending more money on defence, it will follow suit. As economies in the region expand and there are more funds around, it is thought likely we will see ever more of this arms competition in South East Asia.

AFP also reports on SIPRI Report 2009 and again uncritically regurgitates the same misleading data in their report, which is quoted below:

Developing world has launched 'arms race': think-tank

March 15, 2010 - STOCKHOLM (AFP) - – Developing countries have embarked on a dangerous "arms race" with huge sums ploughed into combat aircraft in unstable parts of the world in the past five years, a top defence think-tank has said. The Stockholm International Peace Research Institute (SIPRI) said in an annual report to appear Monday that global arms sales had soared 22 percent in the period from 2005 to 2009 compared to 2000 to 2004.

Imports of combat aircraft accounted for 27 percent of the volume in the last five years. "Orders and deliveries of these potentially destabilising weapon systems have led to arms race concerns in the following regions of tension: the Middle East, North Africa, South America, South Asia and South East Asia," it said. According to the expert in charge of the report, Paul Holtom, resource-rich countries were setting the trend by using their earnings to build out their combat aircraft fleets. "Neighbouring rivals have reacted to these acquisitions with orders of their own. One can question whether this is an appropriate allocation of resources in regions with high levels of poverty," he added.

In the case of South America, the institute found arms imports "were 150 percent higher during the last five years compared to the beginning of the millennium. "We see evidence of competitive behaviour in arms acquisitions in South America," said SIPRI Latin America expert Mark Bromley.

"This clearly shows we need improved transparency and confidence-building measures to reduce tension in the region." Brazil is currently looking to buy 36 combat aircraft with the French-made Rafale, Sweden's Gripen and the US F/A-18 in the running for the contract.

South East Asia also saw a dramatic increase between 2005 and 2009 with Malaysia ramping up its arms imports by 722 percent, Singapore 146 percent and Indonesia 84 percent. The increase in arms imports to Singapore made the island country the first member of ASEAN to make SIPRI's list of top 10 biggest arms importers since the end of the Vietnam war, giving the nation seventh place overall.

"The current wave of South East Asian acquisitions could destabilise the region, jeopardising decades of peace," said SIPRI Asia expert Siemon Wezeman. Vietnam has also been busy building up its military capabilities, ordering submarines and long-range combat aircraft in 2009.

Like Singapore, Algeria made it into the list of top ten biggest arms importers for the first time with the ninth place.

The United States kept its position as the world's biggest arms exporter, accounting for 30 percent of global volume. The Asia Pacific region took in 39 percent of US arms exports followed by the Middle East with 36 percent. Combat aircraft made up 40 percent of Russian exports of conventional weapons and 39 percent of US deliveries.

The report is available on the Internet site: www.sipri.org/databases/armstransfers.

I'll explain why BBC and AFP should be ashamed of their sloppy work by citing another news report on the same in the next post.

 

[OPSSG]

Robert Karniol, writing for the Straits Times has an article on the SIPRI Report 2009 that places the arms spending in context, unlike the two reports above. Robert Karniol's article is quoted below:

Arms resurgence in South-east Asia

SOUTH-EAST Asia has seen deliveries of major conventional defence equipment nearly double over the past five years, as compared with the period 2000-2004, according to a new report to be released today. Malaysia led the regional pack with a surge of 722 per cent during the 2005-2009 period, while Singapore was up by 146 per cent and Indonesia by 84 per cent. Along the way, Singapore became the first South-east Asian country since the Vietnam War era to join the global list of top 10 arms importers.

The report was issued by the Stockholm International Peace Research Institute (Sipri), whose arms transfer database has been compiled since 1950. It uses a rolling five-year average in order to smooth distortion through annual fluctuations. The database is derived from open-source material and covers international arms transfers involving major conventional weapons, detailing importers and suppliers alike. Equipment produced locally is excluded, along with small arms.

The average volume of worldwide arms transfers for 2005-2009 was higher by 22 per cent over the period 2000-2004, according to Sipri. The rise in deliveries to the Asia/Oceania region averaged exactly half that, with the Southeast Asia sub-region significantly outpacing these results. The arms build-up in South-east Asia, which includes the 10 Asean members, in large part represents a recovery after the 1997 economic crisis. On average, the region's buying burst returns it to 1995-1999 import levels, though Indonesia, Malaysia and Singapore have ended up well ahead of the trend.

The Sipri data shows how harshly the economic crisis impacted arms imports in South-east Asia. With the base period 1995-1999 ascribed 100 points, the Asean total was 44 points for 2000-2004 and 104 points for 2005-2009. This compares with global figures of 75 and 92, respectively. The comparative numbers for Indonesia are 64 and 118; for Malaysia, 17 and 137; and Singapore, 73 and 179. Thailand is well behind at 29 and seven, with Vietnam also continuing to fall short at 51 and 68. The other five Asean countries, taken together, are at 50 and 20, when compared with the 1995-1999 base period.

The economic downturn was shrugged off by several major powers in the Asia-Pacific region. The comparative arms transfer figures are 274 and 222 for China, 158 and 147 for India, and 183 and 152 for Australia. But Japan saw a steady slowdown at 39 and 39, South Korea down at 53 and 94, and Taiwan slid to 12 and 11 from the 100-point base.

Sipri researcher Siemon Wezeman points out that replacement programmes are another factor affecting the South-east Asia data. This is particularly felt here because force modernisation really took hold only in the late 1980s and early 1990s as the doctrinal emphasis shifted from internal security to conventional and offshore capabilities, with such assets now ageing. 'The F-5 fighters they bought then are being replaced, for example, though the new equipment is much more capable with advances in technology,' he said. 'At the same time, we're seeing a change from short-range to much longer range (platforms).' But not all the acquisitions reflect replacement imperatives. Submarines are prominent among the new capabilities being introduced, together with systems unavailable 20 or 30 years ago such as unmanned aerial vehicles and beyond-visual-range missiles. Mr Wezeman expects the upward trend in South-east Asia to continue for the foreseeable future. 'A number of countries clearly have a lot of old equipment that needs to be replaced. Indonesia is one. Vietnam is another,' he said. 'I would expect quite substantial force modernisation programmes in South-east Asia.'

The Sipri researcher also sees elements of an arms race in the region.

'There is some evidence of an arms race both within the region and in relation to powers outside the region,' he said. 'That is, an arms race in the sense that one country buys something and the others reacts to it, then the first one may itself react in turn.' There is a deeper danger, Mr Wezeman further noted, in the Asia-Pacific region's lack of effective mechanisms to avoid or resolve tensions. 'In North-east Asia and for Taiwan-China, I don't see the solution of confidence-building and conflict prevention measures as something so relevant in the military sense. These are politically too loaded. And the same for South Asia, with India-Pakistan.'

South-east Asia has a mechanism in Asean, and in the Asean Regional Forum, through which it could address such challenges. But it has yet to bring these into effective play. 'The mechanism is there but it is not being used properly,' Mr Wezeman said. Few in South-east Asia, or among its extra-regional partners, would disagree.

In contrast to the earlier news reports, the section in blue in the above article explains that the arms spending levels for some ASEAN countries have returned and even exceeded the levels in the 1995-1999 time period. However, a quick review of data presented by Robert Karniol does not seem to indicate of a region wide 'arms race'. I think that a strong case can be made that there is ongoing modernization efforts in only some ASEAN countries. OTOH, the case for a region wide arms race is weaker and needs a little more substantiation and explanation - to convince me.

From the data, it seems as if Malaysia is singled out for criticism.

Looking at the actors in East Asia security complex, defence expenditures of China, S. Korea and Japan, each of their respective aircraft procurement budget would dwarf that of all of S.E. Asia combined. Look at the South Asia security complex, again some big numbers for India. What is the impact of Malaysia's 1 squadron purchase in comparison to India's current order of Su-30MKIs (or for that matter China's building plan for the J-10)? Given the disparity in defence budgets, ASEAN countries cannot be said to engage in an arms race against regional powers like India or China. It would not be a race.

As late comers, the Malaysians bought two submarines. But were the Malaysians the first to introduce submarines to ASEAN? NO. It was the Indonesians introduced submarines into S.E Asia with their acquisition of KRI Cakra and KRI Naggala. Are the Malaysians the largest operator of submarines in S.E. Asia? The answer again is NO. It is the Singapore Navy that is the largest operator of submarines in S.E. Asia (with 4 old 2nd hand submarines and 2 more on order). Here, you can make a case of intra-regional dynamics that resulted in the acquisition of new capabilities. Or do we want to blame China (for her submarine fleet building plan with 53 diesel submarines, 6 SSNs, 3 SSBNs and growing)?

Is piracy a problem? Is it logical to purchase the 2 MEKO-200 frigates? Is it enough for the amount of ocean they need to patrol? It's no longer just petty robbery threats but also potential maritime terrorist attacks. Some of the data does not fit very well to support the idea of an arms race. Some of it will, some of it won't - let's all take a look.

For those who are interested in a more in-depth look, there's a 2006 look at 'The Asian Conventional Military Balance'.

 

[kato]

Mmm, i see it a bit differently. Even if, after the crisis, defence budgets effectively just "normalized" again - it speaks volumes that the ASEAN states, after the crisis, went right back into spending the same amounts on defence as before. From a disarmament perspective, that's pretty damning.

And i should point out that while there was a 22% upswing in total arms imports worldwide (stated in the article as "ASEAN countries with only half that"), most of the upswing went into the arms races in South America (+150% !), the Middle East and between India and Pakistan. While in effectively all other theaters worldwide - except SE Asia - arms imports have fallen significantly. That includes China btw. As such this puts SE Asia in being classified a volatile situation.

 

[OPSSG]

I'm not a fan of the idea that just because the Europeans are reducing the defence spending the rest of the world should follow - particularly since NATO faces no peer military threat. For example, for the west, the Cold War ended with the collapse of the Soviet Union. Yet at the same time on August 2, 1990, the world changed for the people of Kuwait who woke up and found that they were a province of Saddam's Iraq.

That includes China btw.

Yes, China is buying less arms from abroad but they are making much more on their own, be it J-10s, JH-7s, H-6s for their air force or ships and submarines for their navy. So citing China as buying less foreign weapons without qualification in the face of an ever increasing Chinese defence budget is very misleading.

I know you threw that one in as a freebie to encourage discussion.

As such this puts SE Asia in being classified a volatile situation.

IMO, it depends on the historical period you are looking at. I'll just give two examples. One, in the period of the Konfrontasi, it was a lot more unstable than it will ever be now. Two, when Vietnam invaded Cambodia in 1979. Singapore troops in the '80s know that we may have to fight in Thailand to help defend them, if Vietnam moved further south.

However, I do agree that there are some tensions and some potential for volatility. Hence, confidence building measures are necessary and it is necessary to look at the regional and extra-regional security dynamics.

Mmm, i see it a bit differently. Even if, after the crisis, defence budgets effectively just "normalized" again

You can't say that defence spending in all ten ASEAN states increased because that is not the case. In fact, for a number of ASEAN states like the Philippines and Laos, defence spending in the relevant periods decreased both relatively and absolutely. IMO, there's no need to provide Philippine and Laos data for further analysis but we should look at the data from Thailand more closely. This is because they share borders with Malaysia, Laos, Cambodia and Myanmar - their decision will impact the surrounding states. According to SIPRI data, Thailand's defence spending as a percentage of GDP from 2005 to 2007 (2008 and 2009 figures were not available) and the amount spent for defence in constant (2005) US dollars were as follows:

2005 - 1.1% (US$1,977 m)
2006 - 1.1% (US$2,060 m)
2007 - 1.3% (US$2,569 m)
2008 - not available (US$3,003 m)

And if you look at the data from 1995 to 1999, the comparable figures are as follows:

1995 - 2.3% (US$3,240 m)
1996 - 2.2% (US$3,240 m)
1997 - 2.1% (US$3,006 m)
1998 - 1.9% (US$2,440 m)
1999 - 1.6% (US$2,113 m)

In the SIPRI data set, Thai defence spending as a percentage of GDP was highest in 1988 at 2.8% (US$2,132 m). For comparison, according to SIPRI numbers, German defence spending in 1988 was 2.9% of GDP (or US$55,627 m in 2005 dollars). So in absolute and relative terms Thailand's highest year for spending on defence as a proportion to their GDP was smaller than Germany on the same year. Context is important.

The SIPRI data does not clearly show the growth of the Thai defence budget. According to Jane's Thai defence spending for 2008 rose to US$4.5b (which is different from the SIPRI data cited above as it is expressed as constant 2005 dollars). Many of the new purchases are urgent and necessary to deal with the insurgency in the South and to deal with the issue of block obsolescence - given that there was a prior 9 year trend (1998 to 2006) of static or decreasing decreasing budgets since the 1997 economic crisis. According to Jane's, between 2002 and 2006 Thailand found itself with a defence budget that was declining in real terms.The trend of decline was arrested in the 2007 and 2008 budgets which saw expenditure increased by a third and a quarter respectively. The 2008 budget is more than double the 2006 level - a result of the change in government caused by the military coup in 2006. However, despite the 2006 military coup, the increased Thai defence spending in 2008 and 2009 is not expected to exceed 2% of their GDP (nor is there an attempt to return to the 1988 levels of 2.8% of Thai GDP).

Currently Germany can reduce spending drastically because the Warsaw Pack no longer exists, while Thailand has not enjoyed such a drastic change in geo-strategic fortune. The Thais still have an insurgency in the south, border problems with Cambodia and domestic political instability. Further, the Thais share a border with Myanmar, which is really a potential arc of instability. Despite concerns about the Thai military as a result of the military coup in 2006, I don't think this is the time for Thailand to unilaterally disarm themselves. In fairness, I don't think we can characterise Thai defence spending levels as a percentage of GDP as high on a historical basis.

it speaks volumes that the ASEAN states, after the crisis, went right back into spending the same amounts on defence as before. From a disarmament perspective, that's pretty damning.

Did the increase in defence spending by Malaysia change the security dynamics in S.E Asia? For me the answer is NO.

First, you have to ask what did the Malaysians have and what did they buy? If you don't look at what was acquired how can you draw a conclusion that there is an arms race?

Second, if you can look at the details it is possible to suggest that there is a potential for an arms race. But what about Malaysia's security considerations? How does the geo-politics of the region play out? The issue I have with the report is that there is clearly an up-trend in Thai defence spending from 2007 but that was not noted in the report proper. I can understand why they neglected to mention it but it is clear that the data is time period selective and the nature of the reporting does not reflect the actual regional arms purchase action-reaction dynamics.

According to SIPRI data, Malaysia's defence spending as a percentage of GDP from 2005 to 2007 (2008 and 2009 figures were not available) and the amount spent for defence in constant (2005) US dollars were as follows:

2005 - 2.3% (US$3,120 m)
2006 - 2.1% (US$3,054 m)
2007 - 2.1% (US$3,409 m)
2008 - not available (US$3,479 m)

And if you look at the data from 1995 to 1999, the comparable figures are as follows:

1995 - 2.8% (US$2,055 m)
1996 - 2.4% (US$1,976 m)
1997 - 2.1% (US$1,858 m)
1998 - 1.6% (US$1,365 m)
1999 - 2.1% (US$1,847 m)

In the SIPRI data set, Malaysian defence spending as a percentage of GDP was highest in 1991 and 1992, at 3.2% (US$1,690 m) and 3% (US$1,679 m) respectively. So there might have been the potential for a Malaysia-Singapore arms race in the 1990s but the 1990s came and went (Malaysia in particular cut back her defence spending in the aftermath of the 1997 Asian economic crisis).

Is the 'arms resurgence/race' driven by intra-regional dynamics/developments? Or is the 'arms resurgence/race' driven by extra-regional concerns? Or is it just modernization (coupled with the rising costs associated with the acquisition of modern weapons systems) and also some level of improved equipping to enable more effective disaster response? I invite others to take a look at the different angles.

The SIPRI Report 2009 details the following arms purchases of Malaysia for the relevant period:

- Malaysia received 6 Su-30MKM, 2 Scorpene submarines, 2 MEKO-200 frigates and 21 PT-91 tanks​

The Malaysians currently operate 8 F/A-18Ds, 10 Mig-29Ns (from the original 18, two crashed and they find it not economical to operate the other 6),18 Su-30MKMs, some F-5s and an assortment of other aircraft. This means that in terms of fighter numbers they operate a new Su-30MKM squadron and two older half squadrons of MiG-29Ns (10 operational) and F/A-18Ds (8 operational).

With the latest acquisition, there is no doubt that the Malaysian air force has greater reach. However, the question I ask myself is:- Does this Su-30MKM acquisition of 18 planes change the balance of power in the immediate region? The answer is - NO. There is no change in the balance of power in the immediate region. Thailand operates 57 F-16A/Bs & has 6 Gripens on order (and Singapore has even more fighters including F-16C/Ds, F5s and F-15SGs on order).

 

[LancasterBomber]

Hmmm interesting discussion. There would have to be a horrendously disproportionate ramp in defence expenditure as a percentage of GDP in Singapore or Malaysia or Indonesia for Australia to bat much of an eyelid (i.e we trust in their judgement on their own needs to protect their territory without the need to develop a sense of paranoia).

Obviously we duly note defence acquisitions in a regional context but I would almost be at the opposite end of the spectrum on this. That is to say I welcome all of these smaller south east asian countries taking the protection of their sovereignty in a serious manner whereby from time to time their expenditure in the modernisation of their armed forces is increased.

I dont think its in Australia's long term strategic interest to have a succession of 'basket case' sovereignties (from a defence perspective) to our immediate north. Malaysia for example is a very sophisticated society on all levels and as such I highly doubt there would be any level of paranoia coming from Australia in relation to their defence procurement decisions.

I reserve my biggest 'frown' in relation to defence procurement towards both India and China. Its a tough call because I do respect the fact both of them have complex border protection issues (perceived or otherwise) but the sheer weight of numbers in their populous scrounging out an existence below the poverty line burdens me heavily (they both are leaving far too many behind).

It is this dichotomy between those on a subsistent living and a burgeoning military expansion that has destabilizing effects in a global context. It is the apparent irrationality of it all that plays on the mind. Needless to say developing economies is a complex task and I dont envy either of them in that regard.

So getting back to the local smaller south east asian nations I really would welcome them taking a much more proactive role in the modernisation of their armed forces and a sense of ownership in the security of their region. For me this promotes a longer term stability for Australia and I would welcome it.

 

[Ananda]

IMO, it depends on the historical period you are looking at. I'll just give two examples. One, in the period of the Konfrontasi, it was a lot more unstable than it will ever be now. Two, when Vietnam invaded Cambodia in 1979. Singapore troops in the '80s know that we may have to fight in Thailand to help defend them, if Vietnam moved further south.

Konfrontasi was the most dangerous time in whole SEA history after end of collonial time. Indonesia for one thing after the end of Soekarno era never had the 'relative' military build-up in the scale of Konfrontasi time.
If Soekarno still in place by the 70's and 80's the situations in SEA will be much different. For one thing no ASEAN in existances. Further on Soekarno ambitions to have nuclear weapons by 70's with the help of USSR, His missiles program, will in certain put the region in very precarious atmosphere.

Not even the Vietnam advantures within IndoChina can be compared to the Konfrontasi era. You can say anything of Soeharto, however the wholle region should thank him a liitle bit at least when he throw Soekarno from office

You can't say that defence spending in all ten ASEAN states increased because that is not the case. In fact, for a number of ASEAN states like the Philippines, defence spending in the relevant periods decreased both relatively and absolutely.

The Sipri data shows how harshly the economic crisis impacted arms imports in South-east Asia. With the base period 1995-1999 ascribed 100 points, the Asean total was 44 points for 2000-2004 and 104 points for 2005-2009. This compares with global figures of 75 and 92, respectively. The comparative numbers for Indonesia are 64 and 118; for Malaysia, 17 and 137; and Singapore, 73 and 179. Thailand is well behind at 29 and seven, with Vietnam also continuing to fall short at 51 and 68. The other five Asean countries, taken together, are at 50 and 20, when compared with the 1995-1999 base period.

The economic downturn was shrugged off by several major powers in the Asia-Pacific region. The comparative arms transfer figures are 274 and 222 for China, 158 and 147 for India, and 183 and 152 for Australia. But Japan saw a steady slowdown at 39 and 39, South Korea down at 53 and 94, and Taiwan slid to 12 and 11 from the 100-point base.

You're right. There's one weaknesses on interpreting statistical data only based to the amount and level of spending, however not comparing those data with economics reality.
For example, this year budget for Indonesia military budget was USD 5 bio. However with last year economy already reach USD 600 bio, that's much bellow 1% of GDP. This USD 5 bio also less than 5% of this year government budget of USD 105 bio.
If the USD 5 bio budget being substract with the amount of Military personal sallary and incentives, housing, and regular maintanance of existing hardware, this will left with only USD 1.5 bio for real deffence new spending. Still miniscule for a country with the size (Geographicall and Economically) like Indonesia.

This report certaintly bias if saying that SEA was hugely mordenising their military inventory. Infact for several contries like Indonesia, the amount of spending was not even enough to repllace the old inventories on one on one basis.

 

[OPSSG]

I reserve my biggest 'frown' in relation to defence procurement towards both India and China. Its a tough call because I do respect the fact both of them have complex border protection issues (perceived or otherwise) but the sheer weight of numbers in their populous scrounging out an existence below the poverty line burdens me heavily (they both are leaving far too many behind).

India and Brazil are the last great frontiers for arms sales. For example, leading contenders like American and European arms suppliers are bidding for the F-X2 fighter deal in Brazil and for a 126 MRCA aircraft deal in India (amongst other deals in the pipeline). I quote extracts below of Ajai Shukla's analysis on the data and it's implications for India:

India's arms import double in five years

18 March 2010 - ...SIPRI --- reveals in its just-released report for 2009 that India is the world’s second-biggest arms buyer over the five-year period from 2005-2009, importing 7% of the world’s arms exports. Only China imported more weaponry, 9% of the world’s total....

...But India seems likely to top next year’s five-year rolling average as China increasingly builds rather than buys weaponry. The SIPRI report clearly points to China’s decreasing dependence on weapons imports. For the five year period under review, China’s annual arms imports declined from $3.5 bn in 2005; $3.8 bn in 2006; $1.5 bn in 2007; $1.5 bn in 2008; to a mere $0.6 billion in 2009...

...In contrast, India continues to import rather than build its defence equipment. From 2005-2009, India’s annual arms imports doubled from $1.04 bn in 2005; $1.25 bn in 2006; $2.2 bn in 2007; $1.8 bn in 2008 and $2.1 billion in 2009.

India’s major capital imports include 82 Sukhoi-30MKI fighters and T-90 tanks from Russia, and an A-50/Phalcon Airborne Early Warning (AEW) system integrated by Israel.

The United States, currently India’s sixth-biggest arms supplier, seems likely to leapfrog to second position once New Delhi starts paying for a series of recent and ongoing acquisitions. The period under review does not reflect India’s purchase of C-130J Super Hercules transport aircraft for $1.1 billion; or the $2 billion acquisition of P8I long-range maritime patrol aircraft. India has also submitted procurement requests to the US for ten C-17 Globemaster airlifters, worth an estimated $2.4 billion; and for 145 M777 ultralight howitzers worth about $647 million. Initial payments for all this equipment could start this year...

...Amongst arms exporters, the US has dominated 2005-09, accounting for 30% of international weapons sales. Russia is next with 23% of the global market, followed by Germany (11%); France (8%); and the UK (4%). The big gainer in this group is Germany, which has doubled its share when compared to the preceding five-year period, i.e. 2000-2004. UK arms sales, in contrast, declined by 13% in the same period.

India's growing dependence on arms imports is both a strength and a weakness. A strength because they have access to military technology that China cannot hope to have and a weakness because they have significant problems with their industrial strategy for local weapons manufacture - they seem to lack focus and there seems to be a culture of late or non-performance in number of projects. If they can't develop it on time, they need to buy the sub-system and integrate the foreign technology into a platform. The value add of the defence science organisation is in helping the armed forces do a review of available technology providers to help the Indian military develop their capabilities in accordance to an integrated national plan across the three services. There seems to be a disconnect between the planning process and the management of competing interests in acquisitions that I do not understand at the moment.

Their procurement and defence science organisations like DRDO must work with their suppliers to deliver what their military wants and also deliver it on time (at the time of the selection for a new platform) - it should never be the other way (Indian scientists telling the military what they need and repeatedly asking for flexible datelines). IMO, any military development project that has shifting goal posts and long gestation periods (so long that the goal posts need to be changed) is not a sign of good project management skills.

 

[STURM]

First, you have to ask what did the Malaysians have and what did they buy? If you don't look at what was acquired how can you draw a conclusion that there is an arms race?

Agreed. I've never like the term 'arms race'', i think it's very misleading and too dramatic. Though there have been patterns and trends in what countries acquire, often leading to another neighbouring country later acquiring a similiar capability, IMO I fully doubt if the term ''arms race'' could be correctly applied to South East Asia.

In Malaysia's case, much of it's defence buys since the 90's were aimed at modernisation or improving on what it already had. Driven by the need to protect the EEZ and the possibility that Vietnam might decide to spread the teachings of Lenin to Thailand and beyond, the largest defence modernisation programme,PERISTA, was introduced.
During PERISTA large numbers of APCs, 88 Skyhawks [of which less thah half entered service] and 2 OPVs were bought, with 2 additional divisions and a corps level HQ [Army Field Command] being raised. It was only in 1988 that the first 155mm howitzers and in 1991 MANPADs, were ordered. Plans to develop Gong Kedak air base, where the MKMs are based, and the Gemas training base were planned under PERISTA but were postponed.

IMO short of a country acquiring a new capability like cruise missiles from China or the Brahmos land attack missile, there has yet to be an arms procurement deal that has
upset the regional balance of power. In the early 90's, the Indonesians announced that they were very interested in Scuds and at the 1997 LIMA, a Russian company obviously in dire need for cash, offered the RMAF [of all air arms!] the Backfire bomber.

It speaks volumes that ASEAN states, after the crisis, went right back into spending the same amounts on defence as before. From a disarmament prespective, that's pretty damming.

The point to take note is unlike most Europeans countries, almost all regional countries
from the very start never had the capability to deal with external threats let alone have any power projection capabilities. Almost all had militaries that were oriented towards counter insurgency/internal security [In Malaysia's case until 1989 it was engaged in counter insurgency operations], hence the need to modernise.Unfortunatly, due to scarce funding and other priorities, modernisation plans are often spread over over a long period or faced a long delay. The recent introduction of MBTs and SSKs into Malaysia service was first planned in the 80's, as were plans to develop Gong Kedak into a full fledged air base.

The Malaysians currently operate 8 F/A-18Ds (some say there are 7 active F/A-18Ds & 1 stored),

An F/A-18D suffered damage during a landing that went wrong at Kuching a few years ago but was returned to service.

[ame="http://www.youtube.com/watch?v=Fiy5jlRNpxI"]YouTube- 101 East - Asia's arms race - 5 March 09 - Part 1[/ame]

 

[OPSSG]

Thanks for the video link (of that two part March 2009 video) and it features both Tim Huxley and Robert Karniol, who are old hands to the developments in the region. I've inserted part 2 of the same below:

[ame="http://www.youtube.com/watch?v=u2mhRv_WPcI"]YouTube- 101 East - Asia's arms race - 5 March 09 - Part 2[/ame]

Arms purchases by China's neighbours fuel fears of clashes

By Kathrin Hille in Beijing and Tim Johnston in Bangkok

Published: March 15 2010 02:00

Military analysts are warning that China's increased regional power has caused its south-east Asian neighbours to step up their own defence purchases, raising the prospect that territorial disputes in the South China Sea could turn violent. Siemon Wezeman, a senior fellow at the arms transfers programme at the Stockholm International Peace Research Institute (Sipri), said that several south-east Asian countries had "dramatically" stepped up their purchases of submarines, fighter aircraft, and long-range missiles in recent years. "While south-east Asian governments . . . still don't openly voice concerns over China, they think about it, and they are making a statement with what they are buying," he said. "Fifteen years ago, there were the same conflicting claims in the South China Sea but the countries didn't have the means to enforce their claims. Now, the moment somebody hits oil there, things might look very dangerous."

Many of south-east Asia's militaries are trying to catch up on purchases they deferred several years earlier as their countries were reeling from the Asian financial crisis. They are driven by a mix of domestic, subregional and larger strategic considerations, and most governments have yet directly to name China as a concern.

However, the Chinese navy has recently built a submarine base on Hainan Island, at the top of the disputed waters of the South China Sea, where it has a territorial dispute with the surrounding littoral states - Brunei, Malaysia, the Philippines, Taiwan and Vietnam - over the potentially resource-rich Spratly and Paracel archipelagos. According to data to be released by Sipri today, Indonesia's arms imports between 2005 and 2009 grew 84 per cent compared with the preceding five years, Singapore's increased by 146 per cent, and Malaysia's rocketed by 722 per cent.

Singapore added six frigates and 32 fighter aircraft over the past five years and ordered two submarines and 12 more fighters. Malaysia took delivery of two submarines, six frigates and 26 fighter aircraft. Indonesia imported four frigates and four fighter aircraft and ordered three more. "Vietnam and Thailand are lagging behind, but both have placed orders recently to be delivered in the coming years," Mr Wezeman said. This includes six fighter aircraft and one early-warning aircraft for Thailand and six submarines, two frigates and eight fighter aircraft for Vietnam. Singapore's concern is over the impact of the shift in the balance of power in the region, said Tim Huxley of the International Institute for Strategic Studies in Singapore. "The real problem is the huge discrepancy in power between China and the south-east Asian nations."

The above FT news article (no link provided as registration is required) has a different angle and is one of the better articles on the topic. In the article, the author is able to place in context the security dilemma of the ASEAN states. There is another perspective from World Politics Review (WPR) called: 'Global Insights: China's Military Buildup Stokes Regional Arms Race'. The WPR article is longer and has more details.

In terms of hard power, ASEAN is not a military threat to emerging global/regional powers like China and India. As such, there is scope for the ASEAN states to seek to engage both the emerging global/regional powers of India and China and the current global hegemonic power, the US (and her allies in Asia and Oceania). It is within this context that the modernisation of the various ASEAN militaries is taking place.

I would like to quote Singapore's Deputy Prime Minister, Teo Chee Hean who gave a speech at CSIS in the US on 15 March 2010. This speech is intended for an American audience and in it he explains how ASEAN sees the rise of China:

WHERE THE MAJOR POWERS MEET: A SOUTHEAST ASIAN VIEW OF US-CHINA RELATIONS

...

2. Singapore and the United States have been staunch friends and close partners for a very long time. For many decades, even before Singapore’s independence in 1965, American ships and aircraft have called regularly at our bases. In the 1990s, when the US lost access to Clark and Subic bases in the Philippines, Singapore offered the United States access to our facilities. Then, in 2005, we signed the Strategic Framework Agreement, which recognised Singapore as a Major Security Cooperation Partner, of the United States.

3. Singapore and the United States share fundamental interests and strategic perspectives. For both our countries, counter-terrorism, maritime security, and counter-proliferation are key issues. Our troops have served with American forces in Iraq and Afghanistan. The Singapore Armed Forces are also deployed alongside the US in the Gulf of Aden, where Singapore recently took command of CTF 151, the multinational counter-piracy task force. Singapore and the United States also work closely in the Proliferation Security Initiative. The strength and reliability of our bilateral relationship has been an important anchor in the strategic calculus of both our countries, in a turbulent world, and a rapidly evolving Asia-Pacific.

4. Let me now speak more broadly, on recent international developments.

5. The global financial crisis has accelerated the shifts in the geopolitical landscape. China and India continue to grow at a rate 5 to 7 percentage points faster than the US, Japan or Europe. As a result, India’s and in particular, China’s relative positions in the world have risen. A significant segment of the Chinese people, especially the younger ones who inhabit the Internet, feel that their time has come.

6. “Will the 21st century belong to China?” In my view, it is too soon to say. China will continue to grow for many years, but the United States is famously resilient. I studied at the Kennedy School in Harvard in the mid-80s, when the imminent eclipse of the US by “Japan as No. 1” was the prevailing expectation. The US has confronted many a challenge before, yet reinvented itself, emerging stronger. As for China, it confronts great challenges of its own in managing the consequences of rapid, yet uneven growth. It faces an ageing population, and the continuing challenge of adapting its system to provide responsive and dynamic leadership, to navigate the future.

7. So, while China may have greater clout on the world stage, the United States remains the world’s leading power — and has the wherewithal to remain so into the future. But this is not pre-destined, and depends on how the US itself decides to pursue that future.

8. The United States continues to bear in large measure, the responsibility for the global commons, and the burden of international leadership, in areas such as counter-terrorism and counter-proliferation, while at the same time, shouldering the cost of fighting two wars, in Iraq and Afghanistan. Selectively, China is also stepping up to the plate in several areas where it has assessed it has an abiding interest, such as in the Six-Party Talks, in the Gulf of Aden, in UN peacekeeping, and in disaster relief operations, such as in Haiti.

9. The question on everyone’s minds is how the US-China relationship will evolve in the coming years...

10. Indeed there is a strong degree of interdependence in the US-China relationship. China needs the US as an export market and a source of investment and technology. In turn, it is one of the largest holders of US Government bonds. This means that China has a stake in US economic well-being. These economic interdependencies will take a long time to unwind. While the financial crisis has sparked discussions about “rebalancing” the two economies, it will take time for China to significantly boost domestic consumer demand, and for the US to reduce its national debt. So, for the time being, the US and China continue to need each other. In fact, the inter-dependence will grow post-crisis...

...

12. On the horizon, there are domestic factors in the US and China that will complicate the bilateral relationship. For the US, with unemployment remaining high and mid-term elections in November, there will be temptation to take a protectionist stance against major trade partners, particularly emerging economies like China. For China, the government cannot ignore the power of grassroots-driven nationalism, the desire of the Chinese people to feel strong and respected on the world stage. Particularly in urban areas, this desire is finding expression in the Internet in a way that the Chinese leadership cannot ignore. China also faces top leadership succession in 2012 and 2013, and no Chinese leader can afford to look weak on core issues, in a time of transition.

13. In the coming years, it is important for the US and China to build up greater strategic trust. It is important that there is no miscalculation, that there are avenues to resolve the issues that may arise. We welcome the views expressed in the Joint Statement, issued during President Obama’s state visit to China last November, where the US welcomed a “strong, prosperous, and successful China that plays a greater role in world affairs” and China welcomed the US “as an Asia-Pacific nation that contributes to peace, stability, and prosperity in the region”. In the coming years, it will take determination, hard-headed magnanimity, and political will on both sides, for the US and China to successfully manage a relationship that combines elements of cooperation and mutual dependence in some areas, and competition in other areas.

14. Let me turn now to South East Asia, where the strategic interests of the US and China intersect. It is where critical sea lanes converge, and it is rich in natural resources. Both the US and China want to engage Southeast Asia, and both want to engage ASEAN.

15. We welcome the US’ renewed engagement of Southeast Asia — the inaugural US-ASEAN Summit in Singapore last year, the signing of the Treaty of Amity and Cooperation. These reflect the Obama Administration’s renewed focus on Asia and Southeast Asia.

16. However, there is a de-sync between what is happening in the strategic arena and what is happening in the economic arena. While the US remains an important strategic partner for many ASEAN countries, China is overtaking the US in terms of trade and investment ties. In 2003, the US was ASEAN’s top trading partner, whereas today, the US is only ASEAN’s fourth largest trading partner. The US is also lagging in terms of trade integration with ASEAN. The US stands out — along with the EU — in not having an FTA with ASEAN. As ASEAN’s economic ties to China deepen, China will command greater attention in the region. And if China revalues the yuan — as the US wants — we can expect China to come with deeper pockets to Southeast Asia to invest, and for China to become an even more important export destination for ASEAN.

17. China is working hard to build a reputation in Southeast Asia as a reliable friend and partner. China is now ASEAN’s most active dialogue partner, particularly via the ASEAN+3. China has bankrolled major projects such as the highway from Bangkok to Kunming and the bridge from Java to Madura, and took on a leading role in the Chiang Mai Initiative. China is also expanding people-to-people ties with ASEAN, through its Confucius Institutes, and scholarships to ASEAN students to pursue higher education in China.

18. China usually takes a “softly, gently” approach in Southeast Asia, but not if core national interests are threatened. We saw this in the Chinese reaction to the joint Malaysia-Vietnam submission last year, to the UN Commission on the Limits of the Continental Shelf, on claims in the South China Sea. China responded the very next day, with a counter-claim that extends as far as the waters off East Malaysia and the Natuna Islands of Indonesia.

19. Over the coming years, as Chinese interest in Southeast Asia deepens, the US ought to also focus more on the region. The US needs to deepen its trade and investment linkages to Southeast Asia. And also continue to step up engagement on the foreign affairs and defence tracks. The United States should continue to reach out to Southeast Asia at the people-to-people level. A good sign is the return of the Peace Corps to Indonesia. Likewise, USAID has done good work in Indonesia by partnering with respected Muslim grassroots organisations, Nahdlatul Ulama and Muhammadiyah, on education and public health initiatives. In particular, the United States should expand education exchanges, as this will allow future generations of American and Southeast Asian leaders to understand and work with one another.

20. Southeast Asia wants to see the US and China having a stable, cooperative relationship — a cooperative and constructive relationship amongst the major powers and the countries in the region. We do not want a return to the days of the Cold War, when Southeast Asia was a contested, divided region. Instead, those in our region want Southeast Asia — specifically, ASEAN — to have a role to play in fostering good, constructive relations between the US and China.

21. Today, ASEAN has renewed strategic relevance. ASEAN has many strengths. It is neutral, and consensus-based, and is open to relations with all. That is why ASEAN can bring all the major powers of the Asia-Pacific around the same table. ASEAN certainly has its weaknesses, and there have been times when it could have done more. Yet, there are important things that ASEAN does very well: facilitating dialogue, building up trust, and forging consensus to work together for the common good, despite conflicting national interests. It is in large part because we had ASEAN, that we have avoided major armed conflict within ASEAN, since its inception in 1967.

22. ASEAN is well-positioned now to serve as the fulcrum for the regional security architecture of the Asia-Pacific. Both the US and China have a keen interest in engaging ASEAN, as do the other key players, such as Japan, India, the Republic of Korea, Australia, New Zealand, and Russia. It is at the ASEAN-led forums — which are well-established — that all the key players come together.

23. In particular, the ADMM-Plus could help foster constructive engagement between the US and China in the defence arena. The ASEAN Defence Ministers’ Meeting, or ADMM, can bring together the defence leaders of the ASEAN countries and the key extra-regional powers, including the US and China, in the ADMM-Plus. Looking ahead, as the ADMM-Plus moves in the direction of greater practical cooperation, there could be the opportunity for the US and Chinese armed forces to take part in practical forms of defence cooperation, or even jointly participate in multilateral exercises, organised under the ambit of the ADMM-Plus.

24. So, there are tremendous benefits for both the US and China to engage ASEAN. It is important that even when the bilateral relationship between the US and China faces difficulties, dialogue and cooperation can proceed unhindered on the multilateral front. This encourages a relationship between the US and China that is more resistant to the occasional shocks that it will be subject to.

25. To conclude, for 60 years, the US has provided the security that underpins the international order in the Asia-Pacific. We do not want to see the pre-eminent US role in the region diminished. At the same time, we see the need to create a regional economic and security architecture that can help draw a growing China into a peaceful and constructive relationship with ASEAN, the US, and other powers which have interests in the ASEAN region. There will of course be disagreements between a rising China and the United States. This is where ASEAN has an important role to play, in fostering stable, constructive relations between the US and China, building trust, and encouraging cooperation where American and Chinese interests coincide...

There is great diversity in Southeast Asia in terms of governance, in terms of economic development, in terms of military capabilities and in terms of religious or ethnic composition. ASEAN chooses not to focus on these differences but rather on what unites them because if they do not present a united front ASEAN could weaken. The member states of ASEAN are aware of these fault lines and are eager to try to overcome them. Therefore if any emerging power acts too aggressively, it is counter productive as it would only serve to unite the member states of ASEAN. China is growing more assertive (viz a viz the US) but it is possible that they will overplay their hand - in many ways, China is a fragile leading regional power with global or superpower aspirations.

Further, the main problem of China-ASEAN and India-ASEAN arms build up is structural. The continued rapid growth in the size of China's and India's economies, especially relative to ASEAN, generates more resources for strengthening the armed forces of both China and India. For China, the PLAN is increasing the size and capabilities of its surface and submarine fleets. For India, their navy is making progress to recapitalise their surface fleet. While ASEAN may be weak in comparison, they are not totally helpless as they try to steer a course in the wake of China and India's rise (it is however legitimate to question the effectiveness of ASEAN's response or rather lack of official response).

 

[OPSSG]

Malaysia and Singapore Defence Spending Compared (1990 to 2008)

According to SIPRI data, Malaysia's defence spending as a percentage of GDP from 1990 to 2007 (2008 and 2009 figures were not available) and the amount spent for defence in constant (2005) US dollars were stated [side by side with Singapore's figures] as follows:

1990 - Malaysia: 2.6% (US$1,241 m) --------[Singapore: 4.9% {US$ 1,679 m}]
1991 - Malaysia: 3.2% (US$1,690 m) --------[Singapore: 4.7% {US$ 2,486 m}]
1992 - Malaysia: 3.0% (US$1,679 m) --------[Singapore: 4.7% {US$ 2,643 m}]
1993 - Malaysia: 2.9% (US$1,784 m) --------[Singapore: 4.3% {US$ 2,727 m}]
1994 - Malaysia: 2.8% (US$1,933 m) --------[Singapore: 4.0% {US$ 2,818 m}]

1995 - Malaysia: 2.8% (US$2,055 m) --------[Singapore: 4.4% {US$ 3,376 m}]
1996 - Malaysia: 2.4% (US$1,976 m) --------[Singapore: 4.4% {US$ 3,698 m}]
1997 - Malaysia: 2.1% (US$1,858 m) --------[Singapore: 4.6% {US$ 4,150 m}]
1998 - Malaysia: 1.6% (US$1,365 m) --------[Singapore: 5.4% {US$ 4,700 m}]
1999 - Malaysia: 2.1% (US$1,847 m) --------[Singapore: 5.4% {US$ 4,788 m}]

2000 - Malaysia: 1.6% (US$1,677 m) --------[Singapore: 4.7% {US$ 4,631 m}]
2001 - Malaysia: 2.1% (US$2,086 m) --------[Singapore: 5.0% {US$ 4,741 m}]
2002 - Malaysia: 2.2% (US$2,370 m) --------[Singapore: 5.1% {US$ 4,999 m}]
2003 - Malaysia: 2.6% (US$3,022 m) --------[Singapore: 5.1% {US$ 5,048 m}]
2004 - Malaysia: 2.3% (US$2,917 m) --------[Singapore: 4.6% {US$ 5,143 m}]

2005 - Malaysia: 2.3% (US$3,120 m) --------[Singapore: 4.6% {US$ 5,464 m}]
2006 - Malaysia: 2.1% (US$3,054 m) --------[Singapore: 4.4% {US$ 5,670 m}]
2007 - Malaysia: 2.1% (US$3,409 m) --------[Singapore: 4.1% {US$ 5,806 m}]
2008 - Malaysia: N.A. (US$3,479 m) ---------[Singapore: N.A. {US$ 5,831 m}]

In the SIPRI data set (from 1988 onwards), Malaysian defence spending as a percentage of GDP was highest in 1991, at 3.2% (US$1,690 m) [Singapore: 4.7% {US$2,486 m}] in constant (2005) US dollars.

Based on the above SIPRI figures, in 1991, Singapore spent US$796 m more than Malaysia. By 1995, Singapore spent at least US$1.3 billion more than Malaysia. The gap in spending moved from less than US$800 m a year in 1991 to more than US$1.3 billion a year by 1995. By 2008, Singapore spent over US$2.3 billion more per year than Malaysia (keeping in mind that Malaysia spends less than US$3.5b a year on defence). Not only is the spending gap is growing, the spending gap is also more than 67% of Malaysia's annual defence budget in 2008 (measured in constant 2005 dollars cited above). When the difference is measured over a 10 year period, the spending gap is even more astounding.

Using the above figures, from 1998 to 2008, Malaysia spent slightly more than US$28.3 billion, whereas Singapore spent more than US$56.8 billion over the same period (in constant (2005) US dollars). This is a difference or a gap of US$28.5 billion. The difference/gap in spending is larger than Malaysia's total defence spending over the same 10 year period. Such a large spending gap affects the ability to raise, train, equip and sustain the respective armed forces.

There cannot be an arms race between Singapore and Malaysia - because it would not be a race. If I may use an analogy, it's a race between a normal athlete [Singapore] and a man with one leg (Malaysia). The Malaysians not only spend less than Singapore, their government also spends their defence dollars more ineffectively. This is an opinion held not just by me but also by an external observer like Dana Dillion, writing on 'Security Challenges in Southeast Asia' in 1997 who said:

"From 1985 to 1993, Malaysia and Singapore spent roughly the same amount of money... Yet in all respects, Singapore's military is far more capable than Malaysia's armed forces... The MAF, on the other hand, still has shortfalls in operational efficiency, readiness, and sustainability." Further, "to replace one aircraft, the A-4, RMAF has purchased: the MiG-29, the F/A-18, and the Hawk-200. Further exacerbating the problem is the low number of each aircraft purchased, which makes buying spare parts and services relatively more expensive and retention of an adequate number of qualified crews considerably more difficult."​

When you look at the Malaysian defence spending pattern, it has quite a bit of ups and downs - demonstrating that it is not their national priority. If you look at the above SIPRI data, there was no Malaysia-Singapore arms race. Rather, Malaysia spent money on defence whenever her budget allowed for it. The figures in Red are years where there was a decline in defence spending. As you can see, there were six years where Malaysia's defence spending declined and ONLY one year where Singapore's defence spending declined.

According to the above SIPRI data, from 1998 to 2008, Singapore out spent Malaysia by US$28.5 billion (in constant 2005 dollars). The difference/gap in spending is larger than Malaysia's total defence spending over the same 10 year period. Therefore Singapore has been able to really move ahead via consistency (in an April 2010 interview with Defence News, Singapore's DPM Teo Chee Hean revealed that Singapore spends about 4.5 percent of GDP on defence). Today the gap is even bigger, with the Singapore 2010 budget for defence set at S$11.46 billion dollars (or US$8.13 billion). However, I do have some concerns about the fidelity of SIPRI data - because not all Malaysian defence acquisitions are under the defence budget. Rather, certain large weapons acquisition programmes of national importance are allocated under the national procurement budget. For example, if a Malaysian acquisition is made under a national procurement program rather than a ministry program, it doesn't come out of that ministry's budget.