US arms manufacturers making fortune from Ukraine war

Since the Ukraine war on February 24, Western governments have been shipping large quantities of weapons to the country, making the arms supply an extremely lucrative trade for dealers. 

The US administration under President Joe Biden has been announcing fresh military packages on a regular basis. Weapons being sent to Ukraine that will keep the US military complexes busy for a long time to come. 

The aggregate US military aid totals at least US$25 billion committed since late February until August 03, 2022 according to the Ukraine Support Tracker.

On Thursday, Secretary of State Antony Blinken announced another US$2.2 billion military package for Ukraine and neighboring countries. Earlier President Biden had also approved a separate US$675 million in weapons to Ukraine, Defense Secretary Lloyd Austin announced. 

There is no sign the US is willing to end war; on Friday the White House said Biden will request a further US$11.7 billion in emergency funding from Congress to provide lethal aid and budget support.

The five largest companies in the world that manufacture weapons are all American namely: Lockheed Martin, Raytheon, Boeing, Northrop Grumman and General Dynamics. In fact, half of the top 100 producers of arms are based in the United States, while twenty are located in Europe. 

In the aftermath of the Ukraine conflict, these five American firms saw their stock prices soar in a sign that investors believed profitable days were ahead.

At a time when the broader stock market as measured by the S&P 500 had slumped by about 4%; Lockheed Martin’s stock price was up over 12% – with most of the gains occurring in its immediate aftermath. Northrop Grumman has jumped by 20%. 

It’s not just the dealers making profit, over the past months; reports have emerged showing how members of Congress stand to personally profit from the war with lawmakers or their spouses holding stock in arms dealers such as Lockheed Martin or Raytheon Technologies. 

Likewise, politicians in Britain such as members of the House of Lords made tens of thousands of pounds by owning shares in the largest British weapons manufacturer and sixth in the world, BAE Systems. The arms dealers’ share price rose by 23% following the outbreak of war in Ukraine. 

It’s not just politicians who benefit from the vast arms supplies to Eastern Europe; weapons dealers have many people on their payroll as well. These include the many pundits on the face of American mainstream media who discuss the war in Ukraine while having strong links with the US arms manufacturers.

It makes the job of the Biden administration much easier when trying to sell to the public the reasons to send more weapons and making announcements about new military packages. 

The US has shipped at least 5,500 Javelin anti-tank missiles manufactured jointly by Raytheon Technologies and Lockheed Martin. The two firms will be paid to replenish American stocks with the money coming from a US$40 billion package signed by Biden. 

The other weapons America has been sending include longer range missile systems, anti-ship missiles, anti-tank missiles, anti-aircraft missiles, helicopters, rockets, launchers, howitzers, radar systems, drones, aerial systems, armored vehicles, small arms, artillery and other arms. Washington has also put aside money for training, maintenance and sustainment. 

That’s a lot of arms being shipped over by the US, which is leading the Western war effort in Eastern Europe against Russia which has long blamed the US and NATO for triggering the conflict.

Moscow requested an emergency meeting of the United Nations Security Council on Thursday to discuss Western arms supplies to Ukraine. 

The Russian Ambassador, Vasily Nebenzya, told the council it was a fantasy to believe that Western powers can determine the outcome of the conflict with their weapons supplies.

A significant proportion of these weapons find itself in the hands of smugglers right from the warehouses. In the darknet, one can find all kinds of offers to buy these weapons. We’ve already seen similar situations in the Balkans and the Middle East where Western military arsenals were then re-exported to Europe and then used by criminal groups on European territory or found their way into the hands of terrorists. 

The UN disarmament chief, Izumi Nakamitsu, has also warned that the flood of weapons being sent to conflict areas such as Ukraine raises many concerns including the potential for diversion.

Campaigners have also been speaking out about the consequences of where the vast number of weapons may end up. Kristen Bayes, a spokesperson for the Campaign Against the Arms Trade, says the provision of weapons to Ukraine is not problem free. "You might think you're handing over weapons to people you know and like, but then they get sold on to people you absolutely don't”.

Campaigners say the risk of advanced and sophisticated weapons delivered to Ukraine ending up in the black market is high because authorities are not in full control of all territory. They argue it is also difficult to keep track of the arms when they have been sent so quickly.

In July, the Financial Times quoted Western officials with knowledge about talks between several NATO members and Kyiv to explore a tracking system or detailed inventory lists for weapons highlighting Western fears about missing weapons. 

“All these weapons land in southern Poland, get shipped to the border and then are just divided up into vehicles to cross in trucks, vans, sometimes private cars,” said one of the Western officials. “And from that moment we go blank on their location and we have no idea where they go, where they are used or even if they stay in the country.”

It’s not just the US; Britain has also committed at least £2.3 billion in military assistance.  Following the Britain are: Poland, Germany, Canada, the Czech Republic, Australia and France. Out of the 28 countries sending weapons, 25 are NATO members. 

Many European countries used the Ukraine conflict to announce plans for increased military spending. The additional commitments are worth at least €200 billion according to the EU.

Germany committed an extra €100 billion in the coming years, with Chancellor Olaf Scholz saying defense would make up two percent of his country’s GDP from now on. As a result of the news, German arms manufacturers can expect to see their sales grow significantly. Berlin has already announced it will be purchasing 35 American F-35 war planes, which are produced by Lockheed Martin and have an estimated lifetime cost of US$1.6 trillion. 

The French President Emmanuel Macron has pledged to expand his country's defence budget, while the British government had already planned increased spending before the conflict broke out but faces pressure from Labour to spend even more. 

Poland said that it had requested 500 HIMARS launchers and ammunition from Lockheed Martin. Estonia confirmed it has been in touch with the American manufacturer also to buy launchers and ammunition worth. Latvia and Lithuania are expected to follow suit.

Campaigners say with so much profit being made from the war, it’s not surprising that peace is not being pursued.

Why is the US avoiding penalizing 9/11 facilitators?

Today marks the anniversary of “the strangest incident” which plunged the world in turmoil. Some quarters say the US administration has kept the ‘facilitators’ immune and avoided taking any punitive measures against them.

The lack of any action by Washington in pursuing the inquiry displays utter disregard to killing of people in Afghanistan and Iraq.

This explains lack of US interest in seeking any justice for the millions of civilians killed by its bombing in          Afghanistan, Iraq, Yemen, and elsewhere. One may recall that the US had waged two wars on the pretext of fighting terrorism. 

Both of which went horribly wrong with civilians paying the price for the policies of hawks and arms manufacturers in Washington. They thrive on the US military adventures abroad or other conflicts that the US supports with constant arms supply. 

The billions of dollars spent on two invasions in the aftermath of 9/11 made the world less safe and could have been invested domestically instead to eradicate the many problems plaguing America such as homelessness, child hunger, poverty or even the country’s outdated infrastructure. 

Last year, President Joe Biden administration came under strong pressure by 9/11 family members, survivors and emergency responders to declassify an earlier FBI report, summarizing an investigation into the attacks. 

In a sign of how fed up the 9/11 families had become, Biden was told he would not be welcome at the 9/11 memorial events unless he fulfilled a pledge to be more transparent than other presidents. 

In what was an expected U-turn, the American president travelled to Saudi Arabia this year, asked for greater oil production and recently approved a multi-billion-dollar arms deal to the Kingdom. 

In 2017, the US clinched deal with the Saudis worth US$350 billion. The trade is simply too lucrative and would not be possible if ties to Saudi Arabia are broken.

America has made accusations against others over the 9/11 attacks, including Iran, something which is quite laughable and touching on borderline stupidity. However, it is not unexpected from the US officials, who have blamed Iran for just about everything. 

The accusation against Iran is more for domestic audience and aimed to make up for Washington’s failures in genuinely addressing the attacks with any tangible results.

What is even more regrettable is that people of Iraq and Afghanistan had nothing to do with the 9/11 attacks but were made to suffer for 20 years after their land was invaded and occupied by American forces. 

20 years later, the US chaotically withdrew from Afghanistan; but in a severe blow to humanitarian efforts in the country, the White House has frozen seven billion dollars of Afghan funds. 

 

 

Queen Elizabeth is dead, but her legacy will continue

Queen Elizabeth II, Britain’s longest-reigning monarch, died on Thursday at the age of 96. The Queen’s son, 73-year-old Prince Charles has succeeded her as King. Her death has garnered the condolences of world leaders, including President Joe Biden, who said that the Queen “defined an era” of “unmatched dignity” in Britain.

For many, particularly in the West, Queen’s 70-year reign was marked by stability and diplomacy. Under Elizabeth, the Royal Family has taken pains to distance itself from the country’s politics and the monarchy’s long colonial history.

But for millions of people who lived through and still suffer the consequences of the Royal Family’s colonialism and racism both abroad and at home, the Queen’s legacy will live on in the form of the violent and lasting rule that the Royal Family has overseen and still profits from.

Many defenders of the Royal Family argue that Queen Elizabeth should be shielded from such scrutiny because she distanced the family from this past and attempted to amends the past and present colonies through events like Commonwealth tours.

Critics rebut this argument, saying that the Royal Family still hasn’t confronted its past or paid reparations to the people who continue to suffer as a result of the British monarchy, decades on from direct colonial rule.

The Royal Family has also faced criticism for appearing to attempt to sweep its history under the rug, especially during the Queen’s platinum jubilee this year.

“By design as much as by the accident of her long life, her presence as head of state and head of the Commonwealth, an association of Britain and its former colonies, put a stolid traditionalist front over decades of violent upheaval,” wrote Harvard University history professor Maya Jasanoff for The New York Times.

“As such, the Queen helped obscure a bloody history of decolonization whose proportions and legacies have yet to be adequately acknowledged.”

For almost as long as the monarchy has existed, it has been a colonialist and imperialist power, colonizing and exploiting dozens upon dozens of countries and territories in particular in the global South, many of which share common consequences of poverty and continued oppression.

Over centuries, Britain has funneled trillions of dollars from its colonies to enrich itself, and it continues to profit from its racist past and present to this day. The monarchy was built on slavery, establishing a slave trade that saw the transport of millions of Africans and South and North Americans to other countries. The slave trade was so vast, in fact, that it wasn’t until 2015 that the country fully paid off its “debts” to slave owners from freeing slaves in the 19th century.

Elizabeth, whose rule began in 1952, did not, herself, enact these policies — and she did do her small part to step in when, for instance, former Prime Minister Margaret Thatcher refused to help end apartheid in South Africa.

But others, like those who directly suffered under British imperialism during her time on the throne, say that she has had a direct impact on modern decision making.

Some historians may say it’s unclear which of the British-imposed horrors that occurred under her rule — like those in places like Kenya and Ireland — were authorized by her.

Others argue that she bears responsibility that these atrocities happened to begin with. Similarly, this distance between the Crown and the country’s political decisions often does not hold for victims of Britain’s colonial rule that occurred under Elizabeth.

The symbolism of her rule does not escape those on the left, who argue that in modern days, the throne is a symbol of oppression, whiteness and vast wealth inequality in Britain — even if mainstream members of the left do not dare advocate for its abolishment.

Elizabeth was at least partially directly responsible for some of the inequalities that the country saw and perpetuated while she was on the throne.

In recent years, the Crown has resisted calls for reparations from countries like Barbados and Jamaica for their bloody and abominable exploitation in the British slave trade.

The Royal Family’s record of racism domestically over the past decades does not reflect well upon the Crown, either. These inequalities have been perpetuated within Buckingham Palace itself; royal advisers banned “coloured immigrants or foreigners” from working in the palace until at least the late 1960s, over a decade into Elizabeth’s reign.

The family’s deep-seated racism appears to persist today; in 2020, Duke and Duchess of Sussex Prince Harry and Meghan Markle outright left the Royal Family over racism within the family, despite protestations from family members like Prince William.

Courtesy: South Asia Journal

China-Israel aim to sign a free trade deal

China and Israel aim to sign a free-trade agreement by the end of 2022 in a breakthrough that would give Beijing its first deal in the Middle East plus a boost after years of trade friction with Australia and the United States.

Chinese Commerce Minister Wang Wentao and Orna Barbivay, the Israeli Minister of Economy and Industry, raised hopes in a chat earlier this year of signing their agreement within 2022, Amir Lati, Consul General of Israel in Hong Kong, told The Jerusalem Post.

The two sides have held trade talks online since the start of the pandemic to follow up on discussions that began in 2016, the consulate representative said.

Meanwhile, Esti Ayalon-Kovo, head of the Israeli economic mission to China in Beijing, said, “Both sides are conducting regular online meetings and are striving to reach an agreement as soon as possible. This agreement is expected to enhance and simplify trade between the two countries.”

Chinese state media had reported in April that negotiations toward a China-Israel trade pact were accelerated following a call between Foreign Minister Wang Yi and his then-counterpart from Israel, Yair Lapid, but no timetable was given.

China has been smarting from tariffs on US$550 billion worth of its exports to the United States since Washington launched a trade dispute in 2018. Sino-Australian relations also have soured over the past five years, especially after Canberra called for a probe into the origins of Covid-19 and Beijing imposed punitive sanctions on Australian imports.

Over the past two decades, Beijing has pursued stronger economic ties in the Middle East, landing comprehensive strategic partnerships with Iran and Saudi Arabia while trying for a trade pact with six oil-rich countries known as the Gulf Cooperation Council. China is interested in the region for its oil, gas and hi-tech investment opportunities.

The deal with Israel would show that the two sides can work together economically despite differences over Palestine, said Victor Gao, Vice-President of the Centre for China and Globalisation in Beijing. China recognized the state of Palestine in 1988. Israel occupies Palestinian land.

 “China hasn’t signed any FTAs in the Middle East, so I hope after this one it can get more in west Asia, the Middle East and Eastern Europe and hold this one up as a model” when seeking trade deals with other countries, Gao said.

A trade pact would make it easier for China to work with Middle Eastern nations on broader issues by showing it does not align only with Arab nations as in the past, said James Chin, a professor of Asian studies at the University of Tasmania in Australia.

“China has always tried to be a player in the Middle East, but the reason they haven’t gotten any traction is that they’re usually perceived as leaning toward Arab nations,” Chin said. “The signal is ‘We can talk to both sides’.”

In November 2019, the two countries discussed trade in goods, rules of origin, customs procedures and intellectual property rights, among other topics, the Ministry of Commerce in Beijing said at the time.

The ministry noted “positive progress” after that round, which was the seventh between the two countries.

Annual trade between Israel and China stood at US$250 million 30 years ago and had reached US$22.8 billion by 2021, according to China customs data, China accounts for about 11% of Israel’s international trade.

China is Israel’s biggest trade partner in Asia, accounting for 39% of its total export of goods to Asia, Lati added. Israel’s chief China-bound exports are medical devices, agricultural technology and other machinery and chemicals, including fertilizer. The trade deal would mark Israel’s second in Asia after South Korea, and would become China’s 16th bilateral trade agreement.

China might leverage the trade pact to access Israel’s hi-tech scene, which is led by innovation and venture capital, Gao said. Israeli tech firms raised US$25.6 billion in capital last year, The Times of Israel reported.

A “foothold” in Israel’s advanced hi-tech would dovetail with China’s giant tech hardware manufacturing sector, Chin said.

We see this agreement will allow new Israeli exporters to export to China, said Esti Ayalon-Kovo, Head of Israeli Economic Mission to China

Israel already has a framework to promote connections among 15 government ministries and agencies from both countries, with the intent of deepening economic cooperation.

This week, Israeli ambassador to China Irit Ben-Abba Vitale said in a speech that China values its start-up accelerators and incubators but cautioned that “academic research” should be converted to “industry research”, domestic media outlets reported.

The Chinese side could tap the trade deal as well, to adopt some of Israel’s agricultural technology, including ways of using water in an arid climate like that of the Middle East, Gao said. Parts of China have been devastated by drought this year.

If it manifests as expected, the agreement will focus largely on trade in goods rather than services, according to Ayalon-Kovo, and Israel’s tariffs are already low overall. She described the agreement as being in its last stages, with the chief hurdle being how to sign it online, rather than in person.

“We see this agreement will allow new Israeli exporters to export to China,” Ayalon-Kovo said.

United States imposes new sanctions on Iran

The United States on Friday has imposed sanctions on Iran's Ministry of Intelligence and Security and its Minister, accusing them of being tied to a disruptive July cyberattack on Albania and engaging in other cyber activities against the United States and its allies.

The move came after Albania severed diplomatic relations with Iran on Wednesday for the same incident, ordering Iranian diplomats and embassy staff to leave within 24 hours. 

The US Treasury Department in a statement said the Ministry of Intelligence and Security directs several networks of cyber threat actors, including those involved in cyber espionage and ransomware attacks in support of the Iranian government.

The Ministry was already designated under US sanctions. Iran's mission to the United Nations in New York did not immediately respond to a request for comment.

Microsoft, whose cybersecurity research team investigated the incident, said in a blog post on Thursday that the Iranian cyber operation involved a combination of digital espionage techniques, data wiping malware and online information operations. The goal of the hackers, according to researchers, appeared to be to embarrass Albanian government officials.

The July attacks temporarily disrupted government websites and other public services. Analysts say the operation was intended to punish Albania for supporting an Iranian dissident group based in the country, known as the Mujahedin-e Khalq (MEK). 

How will Russian gas shutoff affect the EU?

In early September, Russia announced that it would keep the Nord Stream 1 gas pipeline to the EU closed until sanctions are lifted.

As the lifting of sanctions appears off the table, this implies that the EU will be without a large chunk of Russian gas supply this winter.

The impact on the EU economy will be twofold. First, Russia’s decision will keep gas prices high in the coming months—prices are currently around four times higher than a year ago—and likely weigh on the euro, dampening households’ purchasing power and consumption.

Second, the move raises the risk of energy rationing this winter, which could have a significant impact on industrial output.

Even before this latest development, analysts had expressed their apprehensions that the bloc may witness sharp slowdown of the economy. These projections are now set to be revised down in their next forecast.

That said, the effect on the European economy is still highly uncertain. For one, it will vary from country to country.

Those with large industrial sectors and with heavier reliance on Russian gas, such as Germany and Italy, are the most exposed.

Moreover, while Nord Stream 1 is the main route supplying Russian gas to Europe, it is not the only one, as gas is still flowing westward from Russia via Ukraine and Turkey.

The fate of these routes, together with the EU’s efforts to source alternative supply from the North Sea, the United States and Algeria, will be crucial in determining the extent of the upcoming supply crunch.

The weather will also play an important role; a mild winter would reduce gas demand for heating.

Finally, the EU has not sat on its hands in response to the Nord Stream shutdown. Member states are mulling a range of EU-wide options, from gas price caps to a windfall tax on energy companies, and measures to reduce energy demand.

Moreover, further fiscal support is to be expected at the national level. If approved, these measures will offset the fallout from constrained gas supplies to some degree.

As such, while Russian move is certainly a blow to the EU economy, it is not yet a death knell.

“The countries most likely to face gas shortages are Germany, Austria, Italy, the Czech Republic and Slovakia. Those countries' governments are already working to reduce demand and diversify their sources of gas, on the assumption that Russia is no longer a reliable supplier.

The spillover effects will be substantial for the rest of Europe too, with external demand and confidence suffering, and inflation remaining elevated.

On the potential economic fallout, analysts at Goldman Sachs said, a full shutdown could drive European household energy costs up by about 65% to around €500 (US$512) per month.

Industries like chemicals and cement in Germany and Italy might have to cut their gas usage by as much as 80%.

The euro-area economy would likely shrink by more than 2% through March 2023, with GDP in Italy and Germany declining as much as 4% and 3% respectively.

 

Iranian export to India increases 35%YoY

The value of Iranian export to India increased by 35% in the first seven months of 2022, as compared to the same period in 2021, Tasnim news agency reported citing the data released by the Indian Ministry of Commerce and Industry.

Iran exported commodities worth US$361 million to India in the seven-month period of this year, while the figure was US$267 million in the same time span of the past year.

Fruits were the major products Iran exported to India, accounting for 26% of the total exported items. Iran exported US$96 million of fruits to India in the mentioned time span.

During January-July of 2022, Indian export to Iran increased by 54% to US$1.243 billion, while the figure was $807 million in the first seven month of 2021.

Rice was India’s major product exported to Iran in the said time, as the product accounted for 66% of the country’s total export to the Islamic Republic.

India exported US$825 million of rice to Iran in the first seven months of this year, while the figure was US$641 million in the first seven months of 2021.

According to the Indian Ministry of Commerce and Industry, the value of trade between Iran and India was reported at US$1.604 billion during January-July 2022, rising 49% from US$1.074 billion in the same period of time in 2021.

In late May, Iranian ambassador to India said that Iran and India are trying to diversify the channels of payments to expand the bilateral trade.

In an exclusive interview with Financial Express Online, Ali Chegeni said, “We are trying to diversify the channels of payments and accordingly wish to extend and expand an already existing mechanism in order to cover all of the goods and services including all of non-oil goods and to achieve this”.

During the past two years, because of Covid restrictions, we pursue the issue via virtual dialogues and currently our officials are following the matter through the exchange of delegations, the envoy stated.

“We want to develop our economic and trade relations beyond energy and petrochemical products. Since due to the complementarily of Iran and India economies, an extensive range of non-oil trade exists between two sides including trade on goods and services, investment, tourism, education, which may pave the way for multiplying our economic relations ten times more than current relations in mid and long terms”, Chegeni said.