Konstantin MAKIENKO

At present, the vast majority of reports about the arms trade focus on the mere description of their regional structure and product range. However, this does not comprise a comprehensive and insightful analysis as very often such reports ignore the motives and patterns of behavior as described by Max Weber that stand behind importer's decisions. To bridge this gap, this article offers a range of definitions of the arms markets derived from the types of behavior demonstrated by importers. We also have to understand that these types tend to work in combination, with one or the other being dominant.

Types of behavior patterns will be considered in this article as applied to regular and occasional markets .

Such markets are characterized by regular arms acquisitions made in line with planned replacement of obsolete and/or aging armaments. In general, one can forecast demand on the regular market given the time of previous arms purchase, the service life of a particular generation of armament, and the financing allocated for arms procurement in the country involved. The supplier is selected on the basis of a complex combination of financial, technical, political and economic factors as well as the ability of the exporter to offer delivery guarantees and attractive offset programs. Under offset programs, the customer may import technologies and receive other economic benefits.

As a whole, regular markets are shaped on the basis of peacetime acquisitions by countries that are not facing an immediate military threat.

Occasional markets

Occasional acquisitions are usually made in cases where the importer is involved in a military conflict or is facing a serious threat of such conflict. The ability of the exporter to deliver arms to a tight deadline is a predominant factor on such markets. Moreover, occasional markets are dominated by the demand for relatively simple and inexpensive arms systems. Another key factor is ensuring the adequate combat potential of weapons systems and the ability of the armed forces of the recipient country quickly to learn how to use them effectively.

Types of importer motives/ behavior

The structure of the objective requirements of the importer country overlaps with a more complex system of motivations held by its administrative, military and financial bureaucracy. If demand simply reflects the requirements in arms acquisition, motivation can reflect either corporate or/and individual interests and viewpoints of the parties involved. The diversity of these motives is manifested mainly on the regular market while the occasional market is influenced by subjective factors to a lesser extent and allows for decision-making only on a rational and even formal basis. Therefore, the five motives listed below apply mainly to regular markets. However, in theory, the structure of decision-making for occasional markets should be close to the fifth (i.e. rationally pragmatic) type of motivation.

Below we suggest the following types of motivation inherent with arms importers:

The Corruption-related model. This type of motivation is characterized by the fact that, at the time of purchase, the corporate or personal financial gain of the importer country's leadership prevails over its government or national security interests. This model is primarily typical of the Muslim countries and Latin America. In addition, it is quite strong in India and in South and Southeast Asia. With commission payments to mediators banned by law in the United States, it is primarily this motivation that constrains US technological, financial and political domination. There are serious reasons to believe that the corruption-related model of motivation prevails among importers.

The Dependent customer model. As part of this model, arms and other military hardware that are being traded as an intermediate commodity are designed to conceal the true subject of the trade. Under the guise of arms deliveries the importer is in fact buying guarantees for its national security. This type is primarily typical of countries with excessive capital, which are, however, unable to ensure their own national security due to demographic or cultural reasons. The Persian Gulf oil monarchies represent the best example of such a model. Traces of dependency can also be detected in the arms acquisitions of Japan, Israel and to a lesser extent in Taiwan and South Korea. Therefore, in order to operate successfully in this market, the exporter country should have a relevant political weight behind it. Moreover, the reliability of its military and political guarantees should not be questioned. Having a mutual security treaty as well as the deployment of troops and/or the presence of military advisors of the exporter country in the importing state, the importer's status as an ally, partner or a friendly nation can serve as formal signs of the dependency pattern.

The Political model. The decision to import this or that type of arms depends largely on the political orientation of the importer country. This pattern is mostly typical of the post-Communist countries in Eastern Europe and countries like Malaysia and Britain. Political motivation differs from the dependent motivation in that the importer country is not facing any real threat to its security. Its arms acquisitions demonstrate the country's political and cultural preferences rather than efforts to ensure security guarantees. Preferences can be pro-Western (Central and Eastern Europe), anti-Islamic (India), anti-American (China) or pluralistic (Malaysia). In most cases a country would rely mainly on one or two exporters. In the case of Malaysia, which demonstrates geopolitical and economic pluralism, on the contrary, there is a deliberate diversification of sources of arms deliveries.

The Blockade model. A large number of countries that are in urgent need of upgrading their hardware live in conditions of either an official or enforced siege. Here, Iraq is the best example. Libya, Syria and Iran also have elements of this model in deliveries of up-to-date conventional weapons. Taiwan represents a special case. Though Taiwan's type of motivation should be regarded rather as dependent, it has some clear signs of the blockade type as well. The United States as Taiwan's main arms supplier pursues a policy of performing its deliveries in doses just like a prescription, in order to prevent an escalation of tension with continental China. As a result, Taiwan has a shortage of offensive weapons such as long-range attack aircraft, non-nuclear attack submarines and high-tech tactical missiles. Pakistan is close to this model.

The Rationally-pragmatic model. A decision to import arms is made depending on how the price, effectiveness and adequacy of a weapons system corresponds with the requirements of the national armed forces of particular countries. Here, the decision-making process is especially evident in countries with a competent bureaucracy and low corruption levels such as Western Europe, China, and to a certain extent, India. Within this type we can single out the industrial-technological motivation whereby preference is given to the exporter who offers the best offset arrangement or transfer of technology rather than just the best commodity. Exporters that have a stake in leading defense companies of the importer country have the best chance in this sub-type. For instance, such an arrangement exists in the consortium of French companies owning 20 percent in Brazil's Embraer, and U.S. Lockheed Martin having a stake in South Korea's aerospace KAI company. In this market segment the main competition is for the right to get a stake in national defense companies, mainly in the aerospace sector.

The market motivation typology is summarized in Table 1.

Type	Main features	Formal indicator	Predominant markets	Predominant exporters	Key export strategy element
Corruption-related	Aimed at satisfying corporate or private financial interests	Low CPI* index of the government bureaucracy in the importer country	Muslim countries, India, Greece, Southeast Asia, South America, Africa	Russia, France, Ukraine	Identification of effective mediator, generous commission offer
Dependent	Arms imports only an element of importing of comprehensive military security	Mutual security treaty, deployment of troops and/or advisors in the importer country having formal status of ally, partner or friendly nation	Arab Persian Gulf monarchies, Israel, South Korea, Taiwan, Japan	USA, Britain, France	Formal or informal security guarantees, deployment of troops in the importer country
Political	Geopolitical and/or cultural orientation of the importer		Central and East Europe, China, India, Malaysia	USA, Europe, Russia	Enhancement of the competitiveness and attractiveness of the socio-political and cultural model
Blockade	The importer tries to circumvent an embargo and get access to necessary arms systems	Existence of international and/or national arms embargo to particular country	Iraq, Iran, Libya, Syria, Pakistan	China, North Korea, Ukraine, Belarus	Most exporters ignore the market
Rational pragmatic	Choice on the basis of rational, often formal criteria, primarily cost effectiveness and the competitiveness of offset and license programs.	High CPI rates	West, Central and East Europe, Chili, Brazil, China	USA, France, in some cases Russia	The reduction of the product price, the improvement of its technical parameters, formation of industrial alliances, attractive offset programs and technology transfers

^{* CPI (Corruption Perception Index) is annually calculated by Transparency International on the basis of expert polls. It reflects the perception of the degree of corruption in a country by the polled. High figures mean a low level of corruption of the bureaucracy in a particular country, low rates – a high degree of corruption.}

Table 1. Types of arms markets