Beefing up the killing industry in the Holy Land

Jurriaan Bendien bendien at
Tue Nov 4 07:57:31 MST 2003

The US Government will ask Congress to spend $2.22 billion in military aid
to Israel for fiscal 2005, $60 million more than in 2004, the US State
Department announced. The increase follows a 1990s agreement which reducing
assistance to Israel by $120 million a year, but adding $60 million a year
to the military component of the package,  the largest Washington gives to
any country. The State Department says the Bush administration was committed
to enhancing Israeli security and "maintaining Israel's qualitative edge
over any combination of adversaries".

Apart from yearly military and economic assistance, the US Government will
also guarantee international loans by Israel up to an amount of $9 billion
over three years. The $9 billion is liable to deductions equivalent to the
Israeli government's spending on settlements in the occupied Palestinian
territories, but anyhow the US Government has given Israel clearance to
start borrowing before deciding how much it will deduct. Egypt and Jordan,
who have both signed peace treaties with Israel, receive $1.3 billion and
about $225 million respectively in military aid from Washington each year.

The total military expenditure of Israel is about $9 billion (ppp $9.8) or
about 9% of GDP, it represents about 15% of the Israeli government budget
and 1.1% of world military expenditure. The imported weapons are
overwhelmingly from US business. Traditionally Israel received about $1.8
billion of foreign military financing from the US Government per year,
reaching $2 billion in 2001, causing Israel to cleverly arrange for private
financing for arms sales which were secured by expected future earnings from
US military aid. Israel is allowed to use over a quarter of US  finance on
its own indigenous arms production, and is currently pushing to keep even
more aid within Israeli industry. Under Israeli law, all companies selling
to Israel must commit to investing 35 % of contract value into the local
economy. Many agreements with the American weapons industry include "offset
agreements" which involve co-production of weapons, transfers of technology,
and non-military related investment.

Israel exports several hundred million dollars worth of weapons a year (a
lot to China). For the Middle East as a whole, military expenditure
currently is about $80 billion, which represents 10% of total world military
expenditure, and averages about 6.3% of the GDPs of Middle Eastern countries
(the world average is 2.3%)

Israel's active military personnel totals around 164,000 of which 108,000
are conscripts, and can draw on a reserve of 425,000, althrough in principle
every citizen can be forced into military service.  It includes a core
infantry of 134,000, an air force of 37,000 and navy of 11,500 (including
reservists), plus 20,000 reservists giving a total of 182,500 military
personnel out of a total  of  1.3 million males aged 15-49 fit for military
service (about 1 in 7 adult men in that age bracket). The total population
of Israel is 6 million of which 80% are Jewish. Israel is said to have about
470 aircraft, over 130 attack helicopters, 3 submarines, 23 warships, 10
missile patrol boats, and various other ships, 3900 tanks, over 400 armoured
cars, 6000 scout vehicles, over 1300 AGTM launchers, over 1500 artillery
cannon, 6500 mortars, and 1300 SAM launchers. The Palestine Authority is
said to have 35,000 security and paramilitary forces and about 40,000 small
arms. Pro PLO militants number about 8,000, anti-PLO about 6,500 and
Hizbollah several thousand.

Israel currently has a GDP of about $122 billion (or $125.5 in ppp terms) -
of which farming 3%, industry 30% and services 67%) and per capita GDP is
around $19,000. Real economic growth of value added is negative,
perhaps -1.1%. The value of goods and services imported amounts to about
half of GDP, and total external debt is somewhere around the $43 billion
mark or about a third of GDP. Israel exports mainly manufactured products
(weapons, machinery and equipment, software (25%), cut diamonds,
agricultural products, chemicals, textiles and apparel) and its main export
partners are: USA 42.8%, Benelux 7.4%, Hong Kong 6.8%, Germany 4.8%, UK
4.8%, and Japan 3.2% (2001). The richest 20 percent of Israelis earn about
44% of the country's income, similar to the USA.


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