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Israel Foreign Military Sales and Assistance
Sources: The Library of Congress Country Studies; CIA World Factbook
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    By the late 1980s, Israel had become one of the world's leading suppliers of arms and security services, producing foreign exchange earnings estimated at US$1.5 billion annually, which represented one-third of the country's industrial exports. Because the defense industry was not subsidized by the government, it was indispensable for major arms manufacturers to develop export markets, which accounted in some cases for as much as 65 percent of total output. Foreign military sales at first consisted primarily of the transfer of surplus and rehabilitated equipment stocks and the administration of training and advisory missions. Particularly after the October 1973 War, however, foreign sales of surplus IDF stocks and weapons systems from newly developed production lines increased dramatically. Rehabilitated tanks and other Soviet equipment captured from Egypt and Syria were among the products marketed abroad. In addition to its economic and trade value, the expansion of the arms industry assured Israel of the availability of a higher production capacity to supply the IDF at wartime levels. It also provided Israel with opportunities to develop common interests with countries with which it did not maintain diplomatic relations and to cultivate politically useful contacts with foreign military leaders.

    Initially, most of Israel's arms sales were to Third World countries, but, owing to financial difficulties faced by these clients and to competition from new Third World arms producers such as Brazil and Taiwan, different sales strategies had to be adopted. In part through joint ventures and coproduction, Israel succeeded in breaking into the more lucrative American and West European markets. By the early 1980s, more than fifty countries on five continents had become customers for Israeli military equipment. Among Israel's clients were communist states (China and Romania), Muslim states (Morocco, Turkey, Indonesia, and Malaysia), and so-called pariah states (South Africa and Iran). To some degree, Israel was restricted in its marketing by United States controls over arms transactions involving the transfer of components or technology of United States origin. In one well-publicized case, the United States vetoed the sale of twelve Kfir fighters to Uruguay in 1978. Intimidation of potential buyers by Arab states also presented a problem. Observers believed that Arab pressure played a part in decisions by Austria and Taiwan not to purchase the Kfir and in Brazil's decision not to choose the Gabriel missile for its navy.

    The broader issues of Israel's foreign military sales program were decided by a cabinet committee on weapons transfers. Routine applications to sell arms to countries approved by this committee were reviewed by the Defense Sales Office of the Ministry of Defense. The primary concerns were that arms supplied by Israel not fall into the hands of its enemies and that secret design innovations not be compromised. After 1982, however, security restrictions were relaxed to permit export of high technology weapons and electronics.

    South Africa was believed to be one of Israel's principal trade partners in spite of the mandatory UN resolution of 1977 against arms shipments to the Pretoria government. South Africa was known to have acquired 6 Reshef missile boats, more than 100 Gabriel missiles, and radar and communications systems, and to have obtained Israel's assistance in upgrading its British-built Centurion tanks. The South African-manufactured Cheetah fighter airplane unveiled in 1986 was a copy of the Kfir C-2 produced in collaboration with IAI. Subsequent to the passage of the Comprehensive Anti-Apartheid Act of 1986 in the United States, which mandated a cut-off of military aid to countries selling arms to South Africa, Israel announced that it would not enter into any new arms contracts with Pretoria. Existing contracts, however, which would not be canceled, were reported to be valued at between US$400 and US$800 million.

    Military cooperation between Israel and Iran had been extensive since the 1960s, under the shah's regime. After a brief rupture of relations when Ayatollah Sayyid Ruhollah Musavi Khomeini came to power in 1979, cooperation resumed. The Israeli minister of defense in 1982 acknowledged the negotiation of an arrangement worth US$28 million, including spare parts for United States-manufactured airplanes and tanks in the early 1980s. The Israeli motivating factor was the belief that it was to Israel's strategic advantage to help Iran in its war against Iraq, an Arab state bitterly hostile to Israel. Although Israel announced an embargo of arms transactions after disclosure of its involvement in the plan to trade arms for the release of United States hostages in Lebanon, a stricter directive had to be issued in November 1987, following reports that weapons of Israeli origin continued to reach the Iranians.

    Prior to the mass severance of diplomatic relations with Israel after the October 1973 War, Israel had actively promoted military collaboration with a number of African countries. Training or advisory missions had been established in at least ten African states. During the 1980s, Israel quietly resumed these activities in several places, most notably Zaire. Israel dispatched teams there to train elite units and to help reorganize and rearm a division deployed in Shaba Province. Israel also equipped and trained Cameroon's presidential guard unit. Limited pilot training programs were extended to Liberia and to Ciskei, a South African homeland (see Relations with African States , ch. 4).

    Data as of December 1988

    NOTE: The information regarding Israel on this page is re-published from The Library of Congress Country Studies and the CIA World Factbook. No claims are made regarding the accuracy of Israel Foreign Military Sales and Assistance information contained here. All suggestions for corrections of any errors about Israel Foreign Military Sales and Assistance should be addressed to the Library of Congress and the CIA.

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Revised 10-Nov-04
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