With Their Tanks, and Their Bombs, and Their Bombs, and Their Guns: Soviet Arms Exports

In the late 1970s and early 1980s, the Soviet Union was the largest arms exporter in the world. According to Robbin Laird’s article “Soviet Arms Trade with the Noncommunist Third World”, in 1980 the USSR was responsible for 34% of the world’s arms exports. A CIA report from 1980 places the value of those sales at $13 billion in 1978, compared to US sales of $6 billion during roughly the same time. Additionally, their role as an arms exporter to Third World (particularly the Arab Middle East) countries was even more disproportionate. To quote Laird:

“The degree to which the Soviet Union dominates Third World arms sales is best indicated by analyzing the major military equipment end-items shipped to the Third World. In the period from 1979 to 1982, the Soviets were the major supplier of tanks, self-propelled guns, artillery, supersonic combat aircraft, surface-to-air missiles, guided-missile boats, subsonic aircraft, and helicopters. The Western Europeans were the prime suppliers of noncombat aircraft, major- and minor-surface combatants, and submarines. The United States was the prime supplier only of armored personnel carriers.”

Laird, pg 1

Motivation for Exporting Arms

Why did the Soviets export so many weapons to other nations? Was it for political reasons, economic ones, or to ensure the security of its allies? Depending on who you ask, it can be one of those reasons, all of them, or a mix.

Economics
The most basic reason a country would export any item to another is because it would make a profit. But was the Russian arms export industry profitable? In his work “Economic dimensions of Soviet and Russian arms exports”, Ian Anthony quotes his coauthor Sergey Kortunov in contending that it was not. Kortunov states that the Soviet government paid a flat rate to arms producers for each piece of equipment. However, this equipment was often sold to its end users at lowered prices, bartered, or even given away. As a result, it is quite possible that the arms-selling industry in aggregate could have been a net loss for the Soviets. So if arms dealing is not strictly profitable, what other economic motivations could there be for doing it? Laird posits two:

• Securing hard currency: Freeze writes extensively about the USSR’s continual need to import large quantities of goods from the West, particularly massive quantities of grain. All that has to be paid for in hard currency, particularly foreign currency. According to Laird, starting in the 70s the Soviets started to require hard currency payments from the vast majority of their arms customers, leading to 65% of arms transactions during the 1971-1980 period being for hard currency. Soviet arms sales accounted for 22% of their trade with noncommunist countries, second only to oil exports.
• Using foreign sales to drive the development of high-tech equipment: Modernizing weapons systems comes with a huge upfront cost, particularly for big ticket, low volume items like planes, submarines, and ships. Once those initial startup costs are paid and all the engineering, tooling, and testing has been done, subsequent units are likely to be significantly cheaper. There is the old pharmaceutical adage that “getting to the first pill costs a billion dollars, but the second pill only costs a penny.”
  This is particularly important with aircraft, which are extremely technologically sophisticated and therefore expensive, but aren’t required in huge numbers by any one country. With relatively small production runs, the immense cost to develop the aircraft is spread out over a small number of units, so the per unit cost is high. An example of this is the US’s F-22 Raptor fighter. The entire F-22 program cost about $67.3 billion, $32.4 billion of which was spent on Research and Development. With only 195 produced, the unit cost for each plane was over $345 million. However, the marginal cost (cost to build one more unit) was “only” $138-150 million.
  As a side note, this business model is being implemented into the F-35 program. While the plane was extremely expensive to develop, the United States is equipping the US Air Force, Marines, and Navy with the planes, and are additionally selling them to numerous foreign partners. Though the aircraft has only been in service since 2015, 500 of them have already been produced. Economies of scale are already starting to show, with the newest block of F-35A’s only costing $79.2 million per aircraft.

Notoriously contradictory and unreliable Russian statistics, and the fluctuation of the ruble’s value make it very difficult to track the volume and value of military production and sales. Most of Anthony’s article is spent discussing the pitfalls of trying to put a firm dollar value on Russian export values. As such, it is hard to pinpoint just how much foreign weapons sales impacted the Russian economy.

Political

The second (and arguably more important) reason that the USSR exported so many weapons was to advance its political and strategic goals. Anthony notes that historically the primary motivation for Soviet arms sales were political, rather than economic considerations. Laird breaks this down into two reasons:

• First, with the advent of “strategic” (aka nuclear) parity between the US and USSR in the 1970s, focus shifted to conventional military power as being of primary importance. Laird quotes Roman Kolkowicz: “

The Soviets clearly understand that in the nuclear era, major powers need the security of a credible strategic-nuclear deterrent force before they can safely adopt limited-war doctrines and policies. The reason for this lies in the logic of deterrence and limited war. To remain limited, wars involving the major powers… need credible fallback reserves: a strategic (assured destruction) retaliatory threat that will both act to reduce escalatory pressures and provide boundaries.

• With nuclear parity, the adversaries are forced to conduct their conflicts using conventional weapons, in limited conflicts. The Soviets were thus motivated to modernize their conventional forces. Exporting arms helped this in two ways: it helped subsidize the development of new weapons systems as outlined above, and it allowed the USSR to arm the Warsaw Pact and other strategic allies.
• Second, the Soviet Union sought to develop ties with noncommunist nations in key strategic areas, similar to Henry Kissinger’s “regional influentials” policy. They worked to develop partnerships with Third World countries, regardless of their openness to joining the revolution. The United States was doing the same thing at the time, which explains our history of supporting less than savory governments. However, the US and USSR went about this in different ways. While the United States leveraged its enormous economic clout to sway governments and potentates, the Soviet Union could not compete on that basis. Instead, they sought to compete militarily, flooding Third World countries with arms and vehicles. This leveraged Soviet engineering’s reputation for developing inexpensive, durable, easy to maintain weapons to great effect.

Soviet vs American Design

This design mentality was markedly different than what was common with American weapon design. While American designs tended to be more technologically sophisticated and were built to higher tolerances, that came with a tendency towards higher costs, complexity and in some cases fragility. American designs needed more logistical support, maintenance, and cleaning than Soviet designs. For the Americans, the enhanced performance this provided was worth it. They could afford the extra cost and had the logistical capability to keep weapon systems functioning.

In contrast, Soviet industry could not always match the kind of tight tolerances American factories could. Their support facilities were not as well equipped or maintained, and their end users were not as well trained as American soldiers. As a result, they tended to build weapons systems that were cheap, simple to use, and bulletproof. The epitome of this design philosophy is the AK 47, as Nicolas Cage explains below. But it also applied to systems as complex as aircraft. MiG pilots routinely operated out of airstrips that American planes would not be able to even take off from.

As it happened, those characteristics made Soviet arms ideally suited to many Third World countries, whose militaries lacked the infrastructure and training that Western weapons needed to operate properly. Coupled with the USSR’s incentives to provide them, it was no surprise that many Third World militaries were soon shooting AK’s and driving T-72’s. After the breakup of the Soviet Union, even more Soviet arms flooded the black market. And due to the ruggedness of Soviet design, most of those weapons are still in circulation.

References

• Anthony, Ian. “Economic dimensions of Soviet and Russian arms exports. “https://www.sipri.org/sites/default/files/files/books/SIPRI98An/SIPRI98An04.pdf
• Laird, Robbin. “Soviet Arms Trade with the Noncommunist Third World”. https://www.jstor.org/stable/1174128?seq=1#metadata_info_tab_contents
• https://www.politico.com/story/2017/12/14/cia-describes-soviet-arms-dealings-in-developing-nations-dec-14-1980-288763
• https://www.forbes.com/sites/niallmccarthy/2017/03/30/the-cost-of-an-ak-47-on-the-black-market-across-the-world-infographic/#5f5384277442
• https://en.wikipedia.org/wiki/Lockheed_Martin_F-22_Raptor
• https://en.wikipedia.org/wiki/Lockheed_Martin_F-35_Lightning_II
• The World Bank Surveyed AK-47 prices around the world: http://documents.worldbank.org/curated/en/266561468141574815/pdf/wps4202.pdf
• https://web.archive.org/web/20140809180916/http://www.oxfam.de/files/20060623_theak47_200kb.pdf