The volume of defense exports of the State of Israel in 2021 was $ 11.3 billion (about NIS 36 billion), a jump of 30% compared to 2020, when defense exports stood at $ 8.55 billion.
According to the Ministry of Defense’s concluding report for the Defense Ministry’s Defense Division, during the year, about 120 defense industries, with the help and support of Sibet and the Ministry of Defense, managed to sign hundreds of significant contracts around the world, including mega-billion dollars and more. Israel, which ranks eighth in the world in exporting defense systems, will probably rise two to three places in the ranking due to the sharp increase in exports in 2021.
The Ministry of Defense said in the past year and a half that defense exports have been expanded to new markets, regulation has been reduced, bureaucratic barriers have been removed, and an intensive marketing effort has been made around the world, focusing on export agreements between countries. The cooperation between the Ministry and the defense industries is reflected in a sharp increase in the volume of new contracts being signed, for the second year in a row. All this under the rules of the Department of Export Control (AFI) and international conventions.
The internal division of the significant pillars in defense exports in 2021 is headed by missiles, rockets and air defense systems (20%), followed by training and instruction services (15%), drone and glider systems (9%), radar systems and LA ( 9%), manned aircraft and avionics (9%), observation and optronics (5%), firearms and launchers (7%), vehicles and missiles (7%), IT and communication systems (6%), information and cyber intelligence ( 4%), ammunition and armament (4%), marine systems (2%), customer service and miscellaneous (2%).
From a geographical segmentation of the export destinations, it can be seen that the largest destination is Europe (41%) and then Asia Pacific (34%), North America (12%), the countries of the Abrahamic Agreements (7%), Africa (3%) and Latin America (3% ).
Here, too, the strategic impact of the Abrahamic Agreements is evident. The countries of the Abraham Kerry agreements, the emirates of Bahrain and Morocco, have doubled their sales since 2020 and signed several procurement agreements with Israeli industries, and further negotiations are also underway on agreements that will further increase sales to these countries. Morocco due to its conflict with Algeria, the Emirates and Bahrain over the possibility that Iran will return to the nuclear deal, and the atmosphere in the Middle East will heat up.
European countries are looking to acquire weapons
The war in Europe, followed by a significant increase in the defense budgets and equipment of many countries on the continent, leads to the expectation of a further increase in defense exports, which is now reflected in great interest in defense products based on the lessons learned from the war. And even before the war in 2021, there was an increase of more than 40% in exports to Europe compared to 2020.
The rate of export contracts between countries (GTG) has more than tripled, reaching $ 3.365 billion in 2021 compared to $ 911 million in 2020. The volume of defense production directed towards exports stands at more than 70%.
From the distribution of the signing of contracts according to the volume of money, it can be seen that large transactions, more than $ 100 million, constituted 38% of the transactions, transactions between $ 50-100 million constituted 18% of the transactions, transactions 10-50 million, constituted 22% of the transactions and transactions up to $ 10 million Accounted for 22% of transactions.
Ganz: Security is a national need and not a luxury
The head of the Ministry of Defense, Brigadier General (Res.) Yair Koles, said that Israeli defense exports for the first time cross the double-digit export threshold (more than ten billion dollars) and complete a 55% jump within two years, despite fierce competition and fears From the implications of the corona crisis on world defense budgets.
According to him, the demand for the products of the Israeli defense industries has intensified in the past year and one of the manifestations of this is the sharp jump in transactions between countries (GTG). This figure indicates the growing weight of the Ministry of Defense in defense exports and its mediation to foreign governments.
Coles added that looking ahead, the war in Ukraine, alongside the Abrahamic Accords, are creating a high demand for Israeli systems that are at the forefront of technology but also incorporate the simplicity of operation. According to him, this combination sets the Israeli systems in the world apart. And he presents another interesting lesson from the war in Ukraine: “I think the insight has also sharpened, and the minister has addressed it, to the story that every country understands that it has to deal with its own security problems, without relying on any power or other country to protect it.”
Defense Minister Bnei Gantz said that the Israeli defense industries provide Israel with security strength and technological superiority, as well as economic gain and Zionist fulfillment when they establish factories and branches in all parts of the country.
He noted that in the last two years, the Ministry of Defense has worked around the world to increase the market responsibly and intelligently – among other things by strengthening ties with the countries of the region and countries with which we previously had no relations worldwide.
Ganz added that security ties are part of the fabric of political relations of the State of Israel, which works in all arenas to strengthen them and create new alliances. Ganz also said that the war between Russia and Ukraine proves once again to the world what ours has always been clear – that security is a national need for every country and not a luxury.
On the issue of the security situation, Ganz said that in the fight against terrorism we focus first and foremost on the intelligence response, “We also use this intelligence for offensive needs as arrests, whether they are thwarted by events that are about to happen, or whether they are due to investigations.” We know that there is a lot of terrorist activity in the Jenin area, so this area is under extensive activity, including economic damage. In the other areas, we allow the continuation of life, the continuation of worship, the continuation of the holiday routine.
“The idea of the order is to differentiate between the population and the perpetrators of terrorism, and between the regions, and we will try to continue to do so. I conclude and say that for us there are no restrictions on the use of force, the only thing dictating the use of force is operational need.”