With its revenue exceeding 14 billion Euros, it makes Italy the sixth country in the world in the defense sector. With Leonardo confirming it is the first EU company to sell arms. This is what is revealed in the latest report by the Stockholm International Peace Research Institute (Sipri) on the revenues from the sale of arms and military services of the 100 largest companies in the sector in the world.
lords of arms
According to Sipri calculations, this market achieved a turnover of 548 billion euros in 2022. When you look at the revenue figure, there is a 3.5 percent decrease compared to 2021. However, despite the decline in incomes suppressed by inflation and supply chain disruptions, global demand increased significantly due to the impact of the war in Ukraine. According to Sipri, the industry’s rise has only been postponed: “The increase in pending orders and new contracts shows that global arms revenues could increase significantly in the coming years,” the Stockholm-based organization said in its press release.
In the list of arms manufacturers, the USA is in the top five with 5 companies: Lockheed Martin stands out with its revenue of 59 billion euros. British BAE Systems ranks sixth with 24.8 billion. Rounding out the top 10 are three Chinese companies (Norinco, Avic and Casc) and Russia’s Rostec. Italian Leonardo, the first company in the European Union, ranks thirteenth with revenues of 12.4 billion. To find another Italian industry, you have to go down to the 46th place occupied by Fincantieri, which recorded a revenue of 2.5 billion, a slight increase compared to 2021.
Italy is in sixth place
Fincantieri’s positive trend goes against the trend of the vast majority of Western defense companies. “Despite receiving new orders (especially in the wake of the war in Ukraine), many US and European arms companies have failed to significantly increase production capacity due to labor shortages, rising costs, and supply chain disruptions,” Sipri writes. “Many arms companies have faced obstacles in adapting to production for high-intensity warfare,” said Lucie Béraud-Sudreau, director of Sipri’s program on military spending and arms production. “However, new contracts have been signed, especially for ammunition, that could translate into revenue growth in 2023 and beyond,” adds Béraud-Sudreau. As of today, some European industries, primarily in Germany, Norway and Poland, have seen their revenues increase thanks to shipments of ammunition and armored vehicles to Ukraine.
In total, the total revenue of European companies reached 111 billion euros. Italy’s share was just over 15 billion (2.6% of the global total). Half of the world’s sales came from US companies (51%), followed by Chinese companies (18%). It is followed by England (7%), France (4.4%), Russia (3.5%) and then our country. In reality, the share of Italy’s purchases, like other EU countries, should be larger than Sipri indicates. In fact, in the calculation, trans-European companies such as MBDA (4 billion revenue in 2022), a consortium for the production of missile and defense technologies in which Leonardo holds 25% of the capital, are evaluated separately.
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Source: Today IT
Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.
