Original Contribution
January 2012


Up for a new era? – German arms trade with the MENA region

by Otfried Nassauer


German arms trade with the MENA region has been non-spectacular in the last years, with no big deals and no big-ticket items.[ 1 ] However, taking a closer look at Germany’s arms trade with the region reveals a number of interesting issues, including a worrying trend indicating future change.


1. Major weapons – A minor issue?

The UN Register of Conventional Arms lists the exports and imports of seven categories of major weapons: Tanks, armoured personnel carriers and infantry fighting vehicles, large calibre artillery systems, combat aircrafts, attack helicopters, warships and missiles as well as their launchers. Germany has contributed to the UN register each year since its invention. MENA countries are listed as recipients of German major weapon systems in a few cases only, a summary of which is made in the following table:


Table 1: German exports of major arms to the MENA (2000-2010)

Year

Recipient Country

Number

Weapons exported

2002

Egypt

1

FPB  class S148

2003

Egypt

4

FPB class S148

2003

Egypt

1+1

Supply ships class 701+760

2005

Tunisia

6

FPB class S143

2006

UAE

2

Minesweeper class 332

Source: http://unhq-appspub-01.un.org/UNODA/UN_REGISTER.nsf (Germany) FPB=Fast Patrol Boats

On all these occasions old surplus Bundeswehr warships were sold. These exports had neither a major economic nor political significance. They fitted Germany’s official arms trade rhetoric: exports are licensed restrictively and naval exports cannot easily be used for internal repression if the importing country is under authoritarian rule[ 2 ]. Warships are no ideal means to violate human rights, is an argument often used in Germany. However the fast patrol boats exported to Egypt and Tunisia can also be seen as a contribution to these countries’ capabilities to stop refugees from Africa reaching European Union soil.


2. Small arms – A major issue

Germany has been a major supplier of small arms and light weapons (SALW) for many years. Manufacturers such as Heckler & Koch (G3 and G36 rifles, MP5-submachine guns) have a long tradition as suppliers of firearms around the world. Several countries in the MENA imported firearms of German origin. Some in small numbers, others in larger quantities or as standard weapons for their police, security, military and special forces. Standardised reporting to the UN Register is only available for the last six years. Germany contributed national data for all these years. The German data however do not reflect the numbers of weapons exported de facto, but the numbers of weapons licensed for export. Licences to the MENA are summarised in the following table:


Table 2: German exports of SALW to the MENA (2005-2010)

Recipient

Type

2005

2006

2007

2008

2009

2010

Total

 

 

 

 

 

 

 

 

 

Bahrain

sub-machine guns

 

1

10

 

7

50

68

 

rifles

 

 

 

 

2

100

102

 

 

 

 

 

 

 

 

 

Egypt

sub-machine guns

 

 

1209

 

884

 

2093

 

 

 

 

 

 

 

 

 

Jordan

sub-machine guns

185

1

 

2310

 

 

2496

 

grenade launchers

31

 

100

 

300

 

431

 

assault rifles

330

 

 

 

 

6

336

 

LMG

10

 

 

 

 

 

10

 

 

 

 

 

 

 

 

 

Kuwait

rifles & carabines

22

 

 

 

 

 

22

 

sub-machine guns

2

70

20

265

300

80

737

 

assault rifles

 

 

95

 

 

 

95

 

LMGs

1

 

8

 

 

 

9

 

recoilless rifles

 

 

 

200

355

 

555

 

grenade launchers

 

 

1

 

 

15

16

 

 

 

 

 

 

 

 

 

Lebanon

sub-machine guns

 

 

25

100

 

12

137

 

assault rifles

 

 

10

550

 

15

575

 

LMGs

 

 

 

40

 

 

40

 

 

 

 

 

 

 

 

 

Oman

rifles & carabines

 

2

 

1

 

 

3

 

sub-machine Guns

2

10

455

 

 

15

482

 

assault rifles

2

4

 

 

 

 

6

 

grenade launchers

 

3

 

 

1

 

4

 

LMGs

 

2

 

81

 

 

83

 

 

 

 

 

 

 

 

 

Qatar

rifles & carabines

2

 

 

 

 

 

2

 

sub-machine guns

2

1

1

100

34

103

241

 

assault rifles

 

1

 

 

2

 

3

 

 

 

 

 

 

 

 

 

Saudi Arabia

rifles & carabines

10

 

105

 

 

6

121

 

sub-machine guns

2506

1030

 

 

 

 

3536

 

assault rifles

 

2000

5100

600

3500

3002

14202

 

LMGs

 

20

 

898

 

 

918

 

recoilless rifles

 

 

 

2000

 

 

2000

 

grenade launchers

 

 

 

 

 

1

1

 

 

 

 

 

 

 

 

 

UAE

rifles & carabines

6

22

 

10

 

 

38

 

sub-machine guns

110

725

300

 

100

34

1269

 

assault rifles

70

4

20

16

 

625

735

 

LMG

1

 

 

 

 

2

4

 

grenade launcher

1

1

 

 

 

 

2

Source: http://unhq-appspub-01.un.org/UNODA/UN_REGISTER.nsf (Germany)
Note that Germany does not report figures for pistols, since its national statistics list pistols together with other types of firearms such as sniper rifles in an joint category not allowing to isolate the figures for pistols.
LMG=Light Machine Gun

These figures indicate that exports during 2005-2010 were mostly to countries of the Arabian Peninsula, while some smaller quantities of small arms went to countries such as Egypt, Lebanon and Jordan. No licences were issued to North African states during these years, although in some of these countries small arms of German design or origin are in use too.


3. Components are a bigger deal

German export licences for MENA countries reveal mostly low values. Noticeable are transfers of border control equipment to most North African countries and the states on the Arabian Peninsula, including infrared and radar technology and software for military intelligence purposes.


Table 3: German export licences for military goods to the MENA 2005-10 (in million €)

Country

2005

2006

2007

2008

2009

2010

Categories of Military Goods

Algeria

9,0

0,5

8,9

1,8

19,0

19,8

Border control technology, military vehicles, generators and communications equipment, multi-sensor equipment

Bahrain

4,0

3,1

0,2

8,8

2,0

16,4

Military vehicles & parts; parts for patrol boats, ships & helicopters, military intelligence software

Egypt

8,4

16,3

15,1

33,6

77,5

21,0

Military vehicles, parts for armoured vehicles and ships, small arms, communications equipment

Iraq

25,1

10,8

6,8

7,2

25,6

54,3

Mine clearance equipment, military vehicles, ECM equipment, parts for helicopters

Jordan

4,4

21,2

7,3

13,8

9,5

1,4

Small arms &grenade launchers, mine clearance equipment, parts for helicopters

Kuwait

5,0

1,0

0,9

10,0

68,1

19,7

Software for military intelligence, naval guns, parts for ships, anti-tank weapons, munitions, multi-sensor equipment, parts for tanks and armoured vehicles

Lebanon

0,1

0,2

1,1

4,0

1,2

0,8

Small arms, munitions, off-road vehicles

Libya

0,3

2,0

23,8

4,2

53,2

6,1

Off-road-vehicles, communications and ECM equipment, border control technology, radars, helicopter parts, parts for reconnaissance vehicles, armoured off-road vehicles

Morocco

0,1

0,4

9,8

6,5

37,2

13,2

Border protection technology, parts of armoured vehicles, mine clearance equipment, military vehicles, parachutes, parts for combat aircraft, communications & navigation equipment

Oman

13,3

10,1

11,2

22,5

12,7

19,5

Border control technology, software for intelligence, military vehicles, naval equipment, communications equipment, small arms

Qatar

9,4

1,8

2,6

5,2

1,3

4,0

Munitions, software for military intelligence, military vehicles, communications & navigation equipment

Saudi Arabia

29,9

56,9

45,5

170,4

168,0

152,5

Small arms, production equipment & technology for G36 rifles, border control technology, parts for aircraft and missiles, electronic, communications, navigation and electronic warfare equipment, aerial reconnaissance equipment

Syria

-

0,5

-

-

0,1

-

Equipment for UN-force, off-road vehicles

Tunisia

33,0

-

0,3

0,1

3,5

1,6

Fast patrol boats, part for ships, off-road-vehicles, part for helicopters

UAE

316,1

93,9

69,3

142,4

540,8

262,5

Naval guns, torpedoes, part for ships, sonar systems, armoured vehicles, radars, self propelled artillery, communications equipment, military vehicles, electronic warfare equipment, computerized military training area equipment

Yemen

3,9

0,5

0,9

2,6

0,2

0,1

Off-road and Military vehicles, parachutes

Sources: Reports by the Government of the Federal Republic of Germany on Its Policy on Exports of Conventional Military Equipment in 2005-10 (German and English versions), accessible at: http://www.bits.de/main/topics1_NEU.htm
ECM=Electronic Counter-Measures

Only two countries show higher-value licences. Licences for Saudi Arabia have grown considerably over the last years, mostly because of two major deals. On the one hand Heckler & Koch since 2008 has transferred the technology and built a factory in King Khalid Town for licence production of the G36 assault rifles at a plant of Military Industrial Corporation (MIC), which was opened in summer 2009[ 3 ]. The license-production is still dependent on key components supplied by Heckler & Koch.[ 4 ]

Type

2003

2004

2005

2006

2007

2008

2009

2010

Total

Parts for submachine guns (e.g. MP5)

28.500

18.500

45.113

4.006

5.001

32.000

21.309

30.002

184.431

Parts for assault rifles (G-36, G-3)

297.941

91.618

129.000

234.850

117.711

diverse

366.394

56.330

1.058.994

Parts for machine guns

 

 

 

20

 

978

 

8

1.006

Source: Bericht der Bundesregierung über ihre Exportpolitik für konventionelle Rüstungsgüter im Jahre 2003 – 2010

Moreover, EADS has won initial contracts to install a border security system along Saudi Arabia’s 9,000 kilometres of land and sea-borders, a multi-billion project. Other noticeable licenses include components for maintaining and arming combat aircraft, supplied by other European nations, such as the Tornado.

The second major destination is the UAE. The Emirates have been the major recipient of German arms and military goods in the MENA region during the last years. Licences were issued for a wide range of military goods to include not yet delivered self-propelled howitzers, a wide range of naval and electronic equipment, radars, torpedoes, parts for armoured vehicles, communications equipment and many other goods such as all the equipment necessary to operate a modern computerized military training area. At the same time companies and funds from the Emirates invested heavily in German companies, including some producers of military goods.

Because of its history of close relations with Germany in the 70ies and 80ies Libya might have had a potential for receiving higher valued export licences after the end of the sanctions in 2004, but did succeed to win the German governments approval for the one initial bigger deal it wanted.

However, the licences listed in the above table do not reveal all German exports to the MENA region. Components and other military goods make up for most of Germany’s arms trade. A minimum of 50% and possibly up to 75% of Germany’s exports represent military goods that could wear an imprint “Made in Germany – Inside”[ 5 ].

German components and sub-components are contained in a number of major weapon systems exported by other NATO and EU-countries to the region. In most cases German components for such weapons systems show up in the German statistics as licensed for export to other EU and NATO-countries, despite their planned re-export to the MENA region. Such deals can have significant values. European consortia, in which German companies have a major share, have made Saudi Arabia’s Tornado and Eurofighter aircraft. The UK exported them in multi-billion dollar deals, but no Tornado or Eurofighter can fly without its components made in Germany. The same is true for the French Leclerc tanks, operated by the UAE, which have German engines and transmissions. France exports most Milan anti-tank missiles, which are a Franco-German joint product. Recipients have been e.g. Algeria, Egypt and Libya, but again German statistics listed the German components as exports to France and never revealed these final destinations.


4. New trends under a new government

In autumn 2009 Germany got a new centre-right coalition government. The Social Democrats became an opposition party for the first time in ten years. The government works based on a coalition contract which also pays attention to Germany’s future arms export policy. On the one hand the coalition promised to stick to the “political guidelines”, written in 2000 by the former red-green government. “We are committed to current arms export regulations and will continue to advocate the harmonisation of arms export directives within the EU. We actively support fair competition in Europe and confirm our support for the European Defence Agency’s Code of Conduct on Offsets.” On the other hand it made clear that it saw German industries at disadvantage in comparison to European competitors. Action would be required in respect to both the legal situation and Germany’s export practice: “The Foreign Trade Act (AWG) and the Foreign Trade Ordinance (AWV) will be streamlined and made easier to understand. Rules will be eliminated which place German exporters at a disadvantage over their European competitors. More attention must be paid to the international competitive situation of Germany’s business community in the application of the Foreign Trade Act. We will create a level playing field here.”[ 6 ] While no drafts of a new AWG and AWV have yet been presented, the conservative-liberal government has given some indications in what direction it may proceed. It no longer calls Germany’s arms export licensing policy “restrictive” but rather “responsible”, and has taken a number of decisions affecting exports to the MENA nations. A preliminary inquiry whether industries would get an export licence for up to 270 Leopard 2A7plus tanks to Saudi Arabia got a green light from the Federal Security Council (FSC).[ 7 ] A similar decision was taken on preliminary inquiries whether a licence for the export of an APC-production line and several warships to Algeria might be granted. Both decisions indicate the same trends:

4.1. Moving on to big-ticket items
For decades Germany has not been directly involved in big-ticket arms trade with Northern Africa, the Near East or the oil-rich Arab peninsula. No tanks, large calibre artillery, fighter aircraft or helicopter gunships were exported by Germany[ 8 ], while it exported substantial amounts of components, spare parts and small arms. However, since 2008 the Federal Security Council has taken a number of secretivedecisions[ 9 ] that could open up some MENA markets to German exports of major weapons systems, especially tanks, artillery systems and warships. In 2008 the FSC decided to give a provisional green light to the export of 36 Leopard 2A7+ tanks to Qatar[ 10 ] under the condition that Israel would not oppose such a deal. Tel Aviv did not and thus negotiations could be pursued. In early 2011 the Leopards underwent desert trials in Qatar and in February two copies were displayed at IDEX 2011[ 11 ], a clear signal that after decades Leopard tanks were available now to potential buyers in the region. This decision was a precedent. Germany no longer resists delivering Leopard tanks to the region, with Leopard exports to be decided on a case-by-case basis.

As a consequence Saudi Arabia expressed renewed interest in the Leopard 2. In late 2010 the kingdom approached both manufacturers of the Leopard-2 in Germany (KMW and Rheinmetall) and Spain (General Dynamics/Santa Barbara, producing the tank under German licence). Both potential providers needed permission from the German government  - either for the older Spanish version or for the most modern urban operations version from Germany. KMW in 2011 got a green light to start negotiating a deal with Saudi Arabia. They offer the Leopard 2 A7+ that has been specifically designed for both traditional tank battles and internal defence or peace operations[ 12 ].

In the summer of 2009 the FSC authorized the delivery of 24 modern PzH 2000 self-propelled howitzers and Leopard 2 tanks to Qatar.[ 13 ] However, neither the howitzers nor the tanks have yet been delivered. The companies producing them did not yet announce whether they successfully negotiated contracts for both.

In mid-2011 it was also reported that the FSC had allowed for a large deal potentially worth €10bn over ten years with Algeria[ 14 ]. It included inter alia a production licence for modernised Fuchs armoured vehicles. Algeria reportedly wants to introduce up to 300 such vehicles into its forces. In addition the country is interested in receiving MEKO 200 frigates and border control technology. The naval part of this deal had been under discussion for several years. As of 2008 the German government reported that it had authorized a brokering licence for two of these frigates, in case they were to be build under licence in a non-EU shipyard. Major German weapon sales to the MENA region might happen more frequently in the future.

4.2. Continued support for authoritarian Arab governments
Both the FSC decisions on Saudi Arabia and Algeria indicate Berlin’s willingness to continue its support for authoritarian governments in the region. Saudi-Arabia not only has a very poor human rights record, it also recently interfered militarily in neighbouring Bahrain to safeguard another authoritarian Sunni government, helping it to crack down on the uprising of its majority Shiite population. Algeria too has an authoritarian government that grossly violates human rights and legitimises acts of brutal repression by arguing it is fighting islamist terrorists. Most recently it gave shelter to part of the family of Libya’s overthrown ruler Qaddafi.

4.3. Border control technologies – A business of growth
German as well as multinational European companies, such as EADS, have identified border control technologies (and more general internal security related technologies) to offer a major market in the MENA region. While deliveries of individual systems and technologies, such as infrared and multi-sensor technologies and ground surveillance radars dominated initially, companies like EADS meanwhile offer integrated sophisticated systems. EADS won the initial contracts for building a modern integrated control systems for Saudi Arabia’s 9.000 km of borders. The German Federal Police supported the bid by agreeing to conduct the training for Saudi the policemen in using the new technology.[ 15 ] Other MENA countries ordering or discussing border control technology orders with German counterparts include Libya, Katar[ 16 ] and Algeria[ 17 ]

Doing business with border control technologies offers a number of advantages in comparison to weapons deals: Only part of the technology requires an export-licence. Licenses for an additional part are more likely to be issued, since the goods included are dual-use and only a relatively small part represents military goods. In addition border control technology is perceived in many of the licensing countries as supportive to their attempts to control migration and fluxes of refugees. Issuing an export licence is often perceived to indirectly support the effectiveness of EU-initiatives such as Frontex.


5. Open questions and hidden scandals?

Some arms deals hardly surface in times other than war or internal conflicts. Recent examples from Libya are telling: Rebels found and were filmed with Franco-German Milan 2 and Milan 3 anti-tank missiles as well as G36 assault rifles.

Libyan rebels have found numerous Milan F2 anti-tank missiles in the arsenals of Colonel Qaddafi’s armed forces. Photos of the missiles cases show German imprints. Serial numbers and markings of these missiles indicate, that they were maintained and upgraded up to German technical standards in 1989, 1991 or 1992. However, the German government says, these missiles never were part of German Milan stockpiles. It reports German industries as saying, they never exported Milan missiles. The missile launchers and the warheads are produced in Germany, the missiles are finally assembled in France and indeed almost all Milan missiles operated by a total of 40 countries have been exported by France.[ 18 ]

Also seen on footage and photos from Libya are modern G36 assault rifles. The G36 has been exported by Heckler & Koch of Germany to numerous, mostly NATO and EU countries and their allies. Some of the weapons discovered in Libya were filmed in detail. They carried the imprints usually used for weapons produced by Heckler & Koch in their Oberndorf factory: The German Eagle, the official imprint from the German test-firing office Ulm and a serial number which was clearly falsified.[ 19 ] Germany has not licensed their export to Libya and Heckler & Koch denies any deliveries to Libya. Heckler & Koch claims, that the weapons were legally exported to Egypt under licenses issued by the German government in 2003 and 2004. These licenses were reported in the German governments annual reports. They must have been accompanied by an Egyptian end-user-certificate. Egypt has not yet publicly admitted that it conducted a re-export. While further investigations are ongoing, both the Milan and G36 cases are indications for possible major problems with end-user certificates and effectively controlling the trade in small arms and light weapons.

ist freier Journalist und leitet das Berliner Informationszentrum für Transatlantische Sicherheit - BITS

 

Endnotes:

[ 1 ] Except for a large submarine deal with Israel that was extensively reported in Otfried Nassauer: Sechs Dolphin U-Boote für Israels Abschreckung, BITS-Research Note 11.1, Dezember 2011, cf. http://www.bits.de/public/researchnote/rn11-1.htm

[ 2 ] cf.. Germany’s Political Guidelines for the Export of Weopons of War and other Military Goods, last modified on January 19th 2000: Politische Grundsätze der Bundesregierung für den Export von Kriegswaffen und sonstigen Rüstungsgütern, Berlin,19.1.2000 accessible at: http://www.bits.de/public/documents/Ruestungsexport/Politische-Grundsaetze-2000.pdf

[ 3 ] Al Sena’at Al Askariyah, 2nd Issue, Juni 2011, still accessible at: http://www.waffenexporte.org/wp-content/uploads/2011/07/MIC-Aufnahme-Produktion-Mawaqef-magazine-issue2-S-79.pdf

[ 4 ] Deutscher Bundestag, Drucksache 17/6858, p. 16

[ 5 ] Otfried Nassauer and Christopher Steinmetz: “Made in Germany inside” – Komponenten, die vergessenen Rüstungsexporte, BITS-Oxfam Research Report, Berlin, March 2005, accessible at: http://www.bits.de/public/pdf/komponentenstudie.pdf An English version of the executive summary can be found here: http://www.bits.de/public/pdf/oxfam-zfe.pdf

[ 6 ] Cf. http://www.cdu.de/en/doc/091215-koalitionsvertrag-2009-2013-englisch.pdf

[ 7 ] Green light decisions or positive answers on preliminary inquiries by industries have a binding character in respect to the future decision on an application for the actual export licence.

[ 8 ] Submarines to Israel (and loans of Patriot air defence missiles and Fox-NBC reconnaissance vehicles) being the only major exception.

[ 9 ] Decisions on future arms exports in Germany are perceived to be a privilege of the executive organs, which are responsible for keeping company secrets as well. The FSC is a committee of the cabinet which holds secret meetings while its deliberations and decisions are secret, too. Thus neither the general public nor parliament has a right to know about licenses up for a decision. Transparency is limited to the ex-post publication of anonymized information about licenses approved or denied in annual reports.

[ 10 ] Cf.: Merkel bricht Tabu, Der Spiegel, 18.5.2009 accessible at: http://www.spiegel.de/spiegel/print/d-65414108.html and: Deutsche Kampfpanzer für das Emirat Katar, Süddeutsche Zeitung 17.5.2009 accessible at: http://www.sueddeutsche.de/politik/politik-kompakt-schwan-will-ddr-nicht-unrechtsstaat-nennen-1.454768

[ 11 ] At IDEX 2011 Rheinmetall Defence exhibited a Leopard 2 version with a large modular upgrade kit, which in a some bitter form of unintended irony was called “MBT Revolution”. See: Der Boom der Waffenschmieden, Handelsblatt, 22.7.2011, p.20. and: http://www.rheinmetall-defence.com/index.php?fid=5383&lang=2 

[ 12 ] Cf. Deutschland will Saudi Arabien Kampfpanzer liefern, Spiegel online, 2.7.2011 accessible at: http://www.spiegel.de/politik/deutschland/0,1518,771989,00.html Linked in this article is a film about a demonstration of the Leopard 2A7plus Peace Operations version.

[ 13 ] Cf.: Deutsche Haubitzen für Katar, Die Welt, 18.7.2011 accessible at: http://www.welt.de/print/die_welt/politik/article13492570/Deutsche-Haubitzen-fuer-Katar.html and:  http://www.berlinerumschau.com/news.php?id=25168&title=Zeitung%3A+Lieferung+von+24+Panzerhaubitzen+an+Emirat+Katar+genehmigt&storyid=1310882316197

[ 14 ] Cf.: Deutschland gibt Rüstung für Algerien frei, Handelsblatt, 3.7.2011, accessible at: http://www.handelsblatt.com/politik/international/deutschland-gibt-ruestung-fuer-algerien-frei/4352684.html

[ 15 ] Was treibt die Bundespolizei in Saudi-Arabien? MDR-Fakt, 4.4.2011, accessible at: http://www.mdr.de/fakt/artikel108906.html . This deal represents a governmental subsidy for EADS, since the basic salary of the policemen involved is paid for from the federal budget while EADS only has to cover additional costs. In a separate broadcast, MDR-Fakt reported July 18th, 2011, that the training included personnel from the Saudi intelligence services. See: http://www.mdr.de/fakt/Saudi-Arabien102.html

[ 16 ] cf www.pressebox.de/attachment/102474/FY+2007+results-d.pdf

[ 17 ] cf. Merkel denkt an die Wüste, Telebörse, 8.12.2010, accessible at http://www.teleboerse.de/nachrichten/Merkel-denkt-an-die-Wueste-article2103926.html

[ 18 ] Deutscher Bundestag: Drucksache 17/6856, p.28 and: BMWi: Schreiben an Jan van Aken MdB: Schriftliche Fragen an die Bundesregierung, Frage Nr.67, 12.9.2011

[ 19 ] cf. http://www.rbb-online.de/kontraste/archiv/kontraste_vom_01_09/g_36_affaere___deutsche.html - The pictures of the G-36 are contained in the film. (This film may not be available online for an unlimited time, because German public TV-stations for reasons of their competition with private TV stations are required by law to limit the time their broadcastings are available at the internet.)