The real market size of the Russian and Chinese defense industry in South America

Messico An

The United States of America states in its 2022 National Security Strategy that the current international system is characterised by global geopolitical competition between great powers. The same position was expressed by Russia in its Foreign Policy Strategy 2023. The People’s Republic of China, for its part, also emphasises the international system as competitive in its 2019 document “Chinese National Defence in the New Era”.

In this scenario, we can ask ourselves about South America’s role in this global competition, focusing on an aspect related to hard power, that of the military capabilities, and specifically the arms sales of the great powers to the region.

Since the Second World War, the countries of South America have been considered by Washington as a region known as the ‘Western Hemisphere’, and from this point of view, in recent decades there has been a tendency on the part of various South American governments to diversify their foreign relations.

In this context, this South American desire to seek new partners and the emergence of non-traditional extra-regional actors such as Russia, China, India, Turkey, Iran, to name but a few, have become increasingly present in the region and are seeking a greater presence in South America.

In the case of two global powers such as Russia and China, their foreign policy towards South America is multidimensional: political, economic, financial, cultural and even in such sensitive areas as defence, including arms sales.

Despite the news that tends to come out, especially from Moscow or Beijing, pointing to the deepening of military relations between these countries and South American countries, the truth is that the links are not very deep when the grandiloquent news is contrasted with concrete data.

In terms of arms sales, SIPRI data show that since the beginning of the 21st century, Chinese and Russian sales have been very small and concentrated in a few countries: most of the purchases from the region to Russia have been made by Venezuela, in line with the great political harmony between the governments of Hugo Chávez and Nicolás Maduro and Vladimir Putin.

Peru, for its part, bought aircraft from Russia (Mi-17 helicopters and An-32 transport aircraft), as Mexico did as well. These helicopters have also been bought by Ecuador, Colombia and Argentina. These are the Russian products with the largest presence in the region.

From the beginning of the 21st century to the present, China’s presence has been much smaller than Russia’s. Beijing has only made very specific sales to countries in the region, such as a couple of helicopters and anti-tank missiles to Bolivia and Ecuador, which are its most representative markets.

Brazil, Colombia and Chile do not record any purchases from China. Chile neither to Russia nor to China.

Summing up what the statistics show, we can see that the presence of Russia and China in terms of arms sales in Latin America is very limited and only relevant in the case of Venezuela.

There are important structural limitations that have prevented a real presence of Chinese and Russian arms in the region. Firstly, the structures of the South American armed forces are historically linked to the armaments of the NATO countries, as well as to their procedures and doctrine.

On the other hand, the Russian and Chinese offers come from countries that have not tested these weapons in combat (Russia was in this situation until the beginning of the war in Ukraine), which is an obstacle to their full acceptance by Latin American armed forces.

Finally, the context of global competition that we referred to at the beginning of this article means that the United States is clearly acting to prevent Russia and China from increasing their presence in the region. General Laura Richardson, commander of SOUTHCOM (Southern Command), has made this clear on numerous occasions.

Finally, the United States and European countries remain the main suppliers of arms to South American countries. This trend is unlikely to change in the short to medium term: Russia, fully engaged in the war with Ukraine, will focus its defence industry on its local needs; indeed, Russian companies have reduced their global presence in recent years. China, for its part, has few niches in which it can increase its presence in the region; it will not do so in combat aircraft (beyond Argentina’s refusal to accept the J-17 offer, no other opportunities are in sight), nor in submarines or surface ships, after the failed sale of Chinese OPV (Ocean Patrol Vessels) to Uruguay.

As for European companies, France’s Naval Group has sold its Scorpene-class submarines to Brazil and Chile, and its OPVs to Argentina. Sweden, through its SAAB company, has sold Gripen aircraft to Brazil, which will become the backbone of Brazil’s military aviation. Argentina is looking to rebuild its submarine capacity and is considering the options of French (Naval Group) or German (Thyssen Krupp Marine Systems) companies.

There is little activity from Italian companies: Leonardo, with Naval Group’s OPV guns, or some helicopters from the same company. Fincantieri has a very limited presence, which is surprising in an international system that is so navalised and where opportunities are opening up for this type of weapon system.

South America is a minor market in the global arms sales system, but one where the opportunities for Russian and Chinese companies are smaller than those for North American and European companies. This trend is unlikely to change in the short to medium term.

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