UNCLAS SECTION 01 OF 02 BERLIN 000166
SIPDIS
SENSITIVE
SIPDIS
E.O. 12958: N/A
TAGS: PREL, MARR, PARM, GM
SUBJECT: GERMANY: ONE OF EUROPE'S LEADING ARMS EXPORTERS SEES NO
CONFLICT WITH ARMS CONTROL AGENDA
1. (U) Summary: Germany exported 7.7 billion Euros worth of arms in
2006, making it one of the largest arms exporters in the European
Union. Almost half of these sales were to other NATO and EU member
states in support of cooperative multinational projects like the
Eurofighter. But critics point out that a significant portion of
Germany's arms sales -- more than 1 billion Euros worth -- was to
countries that have dubious human rights records or which are
located in unstable regions. German officials insist that Germany
gives due consideration to human rights concerns in its arms export
licensing policy, noting that German policy guidelines are even
stricter than the EU Code of Conduct. Despite the negative media
attention, German policymakers see no contradiction between
Germany's status as a major arms exporter and its foreign policy
positions eschewing the use of military force and prioritizing arms
control. End Summary.
Exports to Countries with "Human Rights Concerns"
--------------------------------------------- -----
2. (SBU) According to the 2006 German Arms Exports Report
(R|stungsexportbericht 2006), Germany exported 7.7 billion Euros
worth of arms in that year, of which 4.2 billion Euros was sold to
non-allied (NATO, EU, and the "like-minded" group of Australia, New
Zealand, Japan and Switzerland) nations. This makes Germany the
leading arms exporter in the EU and the sixth largest arms exporter
in the world according to some statistical measures. The German
media has criticized the government's arms export record for
delivering arms to countries with dubious human rights records or
countries that are situated in unstable regions where arms imports
could stimulate armed conflicts. Of course, a number of the
countries listed as "problematic" by the media were key allies in
the fight against terror. German media and human rights NGOs
criticized, for example, arms exports to nations such as Israel,
Egypt, Indonesia, Saudi Arabia, Turkey and the United Arab
Emirates.
3. (SBU) German Economics Ministry officials note the media
controversy was, in part, provoked by media interpretation of arms
export statistics compiled by the Stockholm International Peace
Research Institute (SIPRI), which calculate the "strategic value" of
arms exports, rather than their actual financial value. Ministry
officials stress that human rights considerations play a key role in
arms export licensing decisions. License requests for exports to
non-EU and non-NATO countries are decided on a case-by-case basis,
using both the EU Code of Conduct and "even stricter" German policy
guidelines. In difficult cases, the Economics Ministry seeks policy
guidance from the MFA.
4. (SBU) Economics Ministry officials indicate that Pakistan remains
a major concern, noting that arms exports (and dual-use exports) to
Pakistan have been suspended -- and all export licensing decisions
deferred -- pending the results of parliamentary elections. Even
after the elections, human rights considerations may prompt the
Ministry to maintain the suspension. Ministry officials hastened to
add that the German Government would also factor into its
decision-making both counterterrorism concerns and Pakistan's
importance as a strategic partner. Economics Ministry officials
also note the "necessity" of using arms sales to build a closer
strategic partnership with India.
5. (SBU) Although the German Government does not unilaterally impose
arms embargoes, Ministry officials claim that Germany generally
adopts a stricter interpretation of UN and EU embargoes than other
EU member states. For instance, German implementation of the EU's
embargo on arms sales to China restricts the entire range of
Wassenaar-listed munitions, going far beyond the EU embargo on sales
of lethal weapons and open platforms. Ministry officials speculated
that, even if the EU embargo were lifted, the German Government
would not permit exports of arms to China.
Individual- vs. Blanket-Approval
---------------------------------
6. (U) Germany's arms export report distinguishes between
individually-approved arms exports (Einzelausfuhr-genehmigungen) and
blanket-approval items (Sammelausfuhr-genehmigungen). The first
category (4.2 billion Euros in 2006; 4.2 billion in 2005; 3.8
billion in 2004) requires German government approval for the export
of every individual item. Blanket-approval items (3.5 billion Euros
in 2006; 2 billion in 2005; 2.4 billion in 2004) are only allowed
for certain items exported to EU and NATO member states and are
issued for cooperative projects, such as the Eurofighter, Medium
Extended Air Defense System (MEADS) and others.
Breakdowns for Individually-Approved Items
-------------------------------------------
7. (U) The Report (published yearly) distinguishes between three
main categories of recipients, listed below with the value of goods
exported:
BERLIN 00000166 002 OF 002
A) EU Member States: 1.9 billion Euros (2005: 1.4
billion; 2004: 1.9 billion);
B) Non-EU NATO allies and "like-minded": 1.2 billion
Euros (2005: 1.1 billion; 2004: 800 million); and,
C) Other countries: 1.1 billion Euros (2005: 1.7;
2004: 1.1 billion). The "controversial" portion of
exports falls under this category.
8. (U) The largest categories of individually-approved exports are
vehicles (such as tanks and armored vehicles), military electronics,
and warships (30.5%, 17.9%, and 13.5% respectively) with a smaller
percentage of total sales including small arms and munitions.
Sale of Used Bundeswehr Equipment
----------------------------------
9. (U) The German military is currently transforming into an
expeditionary force and is discarding much of its Cold War era
weapons systems. As a result, the Bundeswehr's sale /Q}iuct_Q= U#Q
or 9.2% of all exports of military weapons. These include tanks,
submarines and other military hardware. The largest recipient of
those goods is Greece (54%), likely due to that country's ongoing
purchase of submarines and other military hardware from Germany.
The Bundeswehr also contributed to exports in other sectors by
exporting tanks and armored vehicles although specific destination
countries are unfortunately not listed in the report.
Exports to Countries Receiving Development Aid
--------------------------------------------- --
10. (U) The value of Germany's arms exports to countries receiving
development aid has declined from about 900 million Euros in 2005 to
400 million Euros in 2006. This is generally in line with the
belief of many politicians in Germany, who believe nations in need
of development aid should spend their money for humanitarian and
development purposes rather than on arms. Of the 400 million Euros
worth of individually-approved items exported, Pakistan accounted
for 36%, India for 29%, Brazil for 7.1% and Jordan for 5.6%.
Comment: Political vs. Economic Gain
-------------------------------------
11. (SBU) While Germany's status as the EU's leading arms exporter
may seem incongruous with its pacifistic tendencies in foreign
policy and preoccupation with arms control, German MFA officials
argue that the percentage of arms exports to developing countries is
much smaller than from other arms exporting countries, and that the
goods exported to such countries are carefully reviewed prior to
export. Because they see no contradiction between their arms export
record and their arms control rhetoric, we can expect the Germans,
without a hint of self-consciousness, to keep pursuing an aggressive
arms control agenda at NATO and in other international fora.
12. (SBU) The main impetus behind German arms exports is, of course,
economic -- the Bundeswehr's procurement budget is simply
insufficient to fully occupy the productive capacity of the German
arms industry. Without overseas markets, the arms industry would
have to downsize and lay off German employees -- something that no
German politician, regardless of party, wants to see.
Notwithstanding the economic impetus behind German arms exports,
government officials insist on the basis of their rigorous
case-by-case consideration of arms export license applications and
close attention to human rights concerns that there is no
contradiction between their foreign policy rhetoric and arms export
record.
TIMKEN