There has been a huge decline in the income of Chinese arms companies. Despite a record increase in arms sales worldwide last year, there has been a huge decline in the total income of 8 Chinese companies included in the top-100 list of arms industry. Recently a report by Swedish think-tank SIPRI has come out. In which this big revelation was made.
The total earnings of these Chinese companies declined by 10% to $88.3 billion. This report was released by Stockholm International Peace Research Institute (SIPRI) on Monday. According to SIPRI, the performance of Chinese arms manufacturers was in complete contrast to the companies of Japan and South Korea. Where Japan and South Korea are registering a rapid increase in arms sales. On the other hand, Chinese companies are registering a decline.
Chinese weapons are not being sold in the market
NORINCO, China’s largest ground weapons manufacturer, has suffered the most loss. Its arms sales declined from $20.31 billion in 2023 to $13.97 billion last year. That means a decline of about 31% has been recorded. The company’s global ranking has also fallen from 10th place to 11th.
Why did the decline occur?
According to the report, this decline in NORINCO’s earnings was mainly due to government reviews and contract delays that came to light after the company’s board chairman and the head of its military branch were removed due to an anti-corruption investigation in 2024.
Nan Tian, director of SIPRI’s military spending and arms production program and one of the report’s authors, said several major contracts in 2024 were either pushed back or canceled due to corruption allegations in China’s arms procurement system.
Aviation Industry Corporation of China (AVIC), China’s largest military aerospace manufacturer, led the Chinese companies last year with sales of $20.32 billion and ranked eighth globally. However, this figure was 1.3% less than that of 2023.
Two companies still in the race
Only two Chinese companies included in the top-100 list — China State Shipbuilding Corporation and Aero Engine Corporation of China — registered an increase in their arms sales. The first company grew by 8.7% and the second by 9.6%.
Japan-South Korea demand for arms
Where Chinese companies are registering a decline. On the contrary, the country with which it is under tension, Japan, is registering growth. Five Japanese companies included in the top-100 list increased their combined arms sales by 40% to $13.3 billion. The total sales of South Korea’s 4 arms companies increased by 31%, reaching $14.1 billion.
Hanwha Group, South Korea’s largest arms manufacturer, recorded a 42% increase in sales in 2024. Its arms earnings increased from $5.6 billion to $7.97 billion. This company, ranked 21st in the SIPRI list, was the largest non-Chinese company in the Asia-Pacific region.
Arms sales increased in 2024
Total sales in all other sectors increased in 2024. Global arms sales increased 5.9% to an all-time high of $679 billion—a 26% increase from 2015. This increase was highest in Europe and America. The wars in Ukraine and Gaza, as well as global and regional tensions and ever-increasing military spending, led to a surge in sales and new orders.
Leave a Reply