By IPS Correspondents
RIO DE JANEIRO, Apr 25 1997 (IPS)

The arms producers predicted that South America, currently a marginal market for weapons, will become one of the most dynamic and attractive areas for exploitation over the next ten years or so.

And leading companies in the sector, like the US Lockheed Martin, France’s Dassault, the Swedish Saab, Italy’s Marconi, Russia’s Rosvoorouzhenie and the Chinese Norinco, seem prepared to put in the work needed to make the prophecy reality.

This was demonstrated by their participation in the “Latin America Defentech” (LAD 97) meeting this week in Rio de Janeiro, the first international exhibition of land, naval and air defence on the continent.

Unlike the biennial show in Santiago de Chile, which is predominantly aeronautical machinery, LAD 97 has a “balance between the offer to all three branches of the armed forces, the infantry, navy and airforce,” said meeting co-ordinator, Brazil’s Paulo Correa.

Some 89 exhibitors from 12 countries took almost a year to prepare for the show, aiming to seduce the regional Defence Ministries and the special guests, Brunei and Croatia, with all their war paraphernalia.

“Another difference with Santiago is that this is an exclusively professional, commercial affair, not open to the general public,” said Correa, who hopes to put LAD on the official calendar every other year.

This would basically mean the institutionalisation of the feared “arms race” in South America.

Although the organisers and exhibitors of LAD 97 obviously would like this, they prefer not to refer to the fact. On the contrary, they stress the legitimate need for national defence and the contributions made by the war industry to scientific and technological development in general.

Brazil’s vicepresident, Marco Maciel, who inaugurated the show Wednesday, said the event had “allowed us to verify the scientific-technological development of the sector” and this will help us draw conclusions which also serve in the development of other areas, like aerospace, transport and medicine.

With the end of the cold war and the undisputed warlike hegemony of the United States, the annual defence budgets and military expenditure of this country have been registering significant cutbacks, despite the iron opposition of the Republican Party.

In 1987, this budget stood at 363.7 billion dollars. For this year, president Bill Clinton had asked for 257.5 billion and the Republican members of Congress managed to tack on a further 13 billion.

This policy has had serious consequences on the US industrial- military complex, which receives most of the defence funding. In employment terms, the number of jobs fell from 3.9 million in 1987 to 2.8 million in 1995. Something similar happened in Europe for different reasons.

The reaction of the arms sector in general has been to become concentrated in ever fewer more powerful companies in order to better deal with a shrinking and, above all, more competitive market.

The association of Martin Marrietta with Lockheed, and Saab with British Aerospace to build the multipurpose Grippen jet, are cases in point.

Moreover, the market is more than ever committed to the strong exporting role of Russia and China.

In LAD 97, Russia participated through the State company Rosvoorouzhenie, the main national arms exporter, and Mig-Mapo, builder of the famous Mikoyan planes.

China was represented by the giant Norinco, producer of all the warlike products imaginable, from low-cost imitations of other countries’ hand guns to aircraft carriers.

Despite the excess offer, in 1996, the Institutie of International Peace Studies, in Stockholm, registered a significant reduction in military spending worldwide, except for in the Middle East, Southeast Asia, India, Pakistan and Algeria.

It is therefore understandable that the companies are looking for new markets, aiming their weapons at South America, a little developed market, where the trade barriers are well on the way to disappearing.

The budget difficulties confronting many Latin American armies could, however, impose strict limits on the expansion plans of the international war industry – in Argentina, for example, military spending fell 70 percent in 10 years.

Furthermore, conversations held during the LAD 97 meeting identified two other equally worrying issues.

For although the big US producers argue against the prohibition of selling high-technology equipment to Latin America, saying the military are now totally controlled by the civil power, they do not really believe, or hope, that the situation is really so.

“It could be that the civil governments have other priorities, but the Armed Forces, or each of their branches, as is the case in Brazil, has their own plans to reequip and modernise, and their own ‘lobbies’ and resources with which to fund this,” said one expert.

In Chile, for example, the army has 10 percent of all the income from copper sales, totally around 400 million dollars per year.

Also, for the arms builders these budget restrictions are merely “circumstantial.”

They believe the rearmament process underway in all three branches of the Chilean armed forces will also lead, sooner or later, to the reactivation of the budgets in the neighbouring armies, especially in Argentina, and therefore the rest of the regional nations.

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