The international traffic in arms consists mainly of arms sales between governments or between government controlled firms and other governments. The traffic facilitates arms races in certain regions or between blocs. The supply of arms to an area of potential conflict is a destabilizing factor which increases the risk of conflict. The trade in armaments is one of the largest sectors of the global economy, exceeding oil. There is no recognized fixed-price range for weaponry and very few arms are sold at their true value. Rather deals are made, based on barter or cash, and there may be dubious allocations for "agents expenses", "percentages" and the like. The trade in nuclear weapons is subject to treaty control (although many 'nonnuclear' weapons could be used as part of a nuclear delivery system), but there is very little coordination or agreement concerning the types of non-nuclear weapons to be supplied and the types of clients that may receive them.
[Developing countries] As an indication, the value of imports by third world countries of major weapons (ships, aircraft, armoured fighting vehicles and missiles) in 1982 was estimated as $8,448 million (1975 constant dollars). In 1972, imports were valued at $3,473 million on the same basis. Information about the transfer of other weapons (rifles, automatic weapons, mortars, artillery pieces) is fragmentary and unreliable. This can be compared with the report that arms sales to the Third World fell by 20% in 1992 to their lowest levels since at least 1985 (from $28.6 billion in 1991 to $23.9 billion in 1992, measured in constant dollars.) Sales from Russia fell to $1.3 billion from $5.9 billion in 1991, and a peak of $28.8 billion in 1986. (Russia was by far the largest arms producer and exporter of the Soviet Republics, and part of the reason for the fall in sales is the reduction of military aid programmes that granted large discounts to Cold War clients.) The USA, France and the UK were the three largest manufacturing countries exporting major arms to the Third World in 1991, to the value of $14 billion, $3.8 billion and $2.4 billion, respectively. The Middle East was the largest arms market in the Third World countries. Germany led all other nations in export of missiles and missile launchers in 1992.
The war between Iran and Iraq was able to continue for so many years partly due to the provision of arms from Europe and the USA. Between 1981 and 1988, Iran bought $17.5 billion worth of arms, Iraq bought $47.3 billion worth and developing nations as a whole purchased $301.4 billion worth. In 1988, the former Soviet Union sold $9.9 billion, the USA sold $9.2 billion, and France and China, each, sold $3.1 billion worth of arms to developing countries. Some of the other nations involved in arms sales include: Czechoslovakia, North Korea, Britain, Italy, Germany, Austria, Belgium, the Netherlands, Norway, Sweden, and Brazil.
Arms purchases by governments encourage producers to use resources in the production of arms instead of alternative types of production which might employ more people and strengthen the capacity of the economy in the producing country to produce items that would fulfill human needs. In addition, the arms trade often enhances the capacity of receiving governments to control their populations, hence arms trade may strengthen military regimes.
In the existing international structure certain arms transactions are clearly inevitable and, within the limitations of current international philosophy, admissible. So long as military alliances exist, it would be unrealistic to criticize the exchange of weapons among allies. The important area for examination is that which concerns the less developed countries.