(EST PUB DATE) EAST ASIA: GROWING SOURCE OF MILITARY EQUIPMENT FOR THE THIRD WORLD

• Document Type: FOIA
• Collection: FOIA Collection
• Document Number (FOIA) /ESDN (CREST): 0001287104
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 25
• Document Creation Date: June 22, 2015
• Document Release Date: September 30, 2009
• Case Number: F-2006-00532
• Publication Date: July 1, 1987

Directorate of
Intelligence
S. for the Third World
East Asia: Growing Source
of Military Equipment
A Research Paper
APPROVED FOR RELEASES
DATE: 09-10-2009
This paper was prepared by
ce
orz ys WLUI a conrr~ u i~ t on r m
pffice of Global Issues. Comments
the Chief, OEA
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EA 87-108
 East Asia: Growing Source
of Military Equipment
for the Third World
Summary
Information available
as of 1 July 1987
was used in this report.
 some.
t e mte a es is
expending cons era a ip omatic a ort in an attempt to stop China and
other East Asian countries from selling military goods to Iran and Iraq.
Chinese deliveries of Silkworm antiship missiles are particularly trouble-
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 East Asia: Growing Source
of Military Equipment
for the Third World
Scope Note This is the second in a series of assessments and research papers that
address regional security-related issues in East Asia that are of current
concern to US policymakers.
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 Contents
Summary
Scope Note
New Arms Merchants
Major Military Suppliers
 East Asia: Growing Source
of Military Equipment
for the Third World F_
East Asia has become an important source of weap-
ons, munitions, military equipment, and technical
services for Third World countries. Although the
1980s was not a propitious time to enter the arms-
exporting business, East Asia's defense industries
have increased their share of the shrinking market
while the Soviet Union and major West European
suppliers have faced decreases.
Major Military Suppliers
China is East Asia's largest arms exporter
omen to e arms usmess, its ecision in 1980 to sell
arms for profit apparently stemmed from astrong
desire to increase its foreign exchange holdings and
meet military needs for defense modernization at a
time of economic retrenchment. Chinese leaders, con-
cerned about the economic as well as the political
consequences of closing down defense plants whose
largely outdated weapons were no longer needed by
forces beginning the transition to a modern army, saw
arms exports as an expedient to military moderniza-
tion. China's planners realized that their defense
industries could earn substantial hard currency by
producing and exporting weapons. F___]
 Despite its public disclaimers, China has sold large
quantities of military goods to Iran
By 1985, however, the Chinese apparently had decid-
ed that Iran had become a lucrative enough market to
warrant direct shipments, even though they knew that
Iraq and the United States would be critical. F_
On the basis of a variety of
3
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 East Asia's Military Sales to Iran and Iraq
East Asian materiel contributes substantially to sus- military goods/services to the belligerents-Iran has
taining the Iran-Iraq conflict. Since 1980, we estimate bough
East Asia has sold almost
Iran
North Korea and China are the two largest suppliers
with ove in sales each.
? China, now Iran's largest supplier, sold n
the past year. Sales include tanks, armore ve t-
cles, artillery, air defense and antiship missiles,
small arms, and munitions. Chinese Silkworm anti-
.ship missiles currently threaten merchant shipping
near the Strait of Hormuz; CSA-1 surface-to-air
missiles defend Tehran; and F-7 f ghters/other air-
craft may soon be delivered.
 Figure 4. Chinese F-7M Air-
gu4rdighter armed with air
to-air missiles---]
n weapons in the past year, including
n is tp and antiaircraft missiles, artillery, small
arms, and large quantities of munitions. China has
begun training Iranian pilots, and we believe China
may have sold F-7' fighters to Iran.
The Chinese have gone to great lengths to satisfy both
Iraqis and Iranians. They have provided weapons
training in China, modified military equipment to
satisfy customer specifications, and provided follow-
up technical assistance to resolve operational and
maintenance problems with their equipment. China's
responsiveness has paid handsome dividends. [
 ~.
 ? Introduced a mobile, short-range ballistic missile
(SRBM) called the M-9.
mese
o cia s c aim t o wit a conventional
warhead will not be ready for export until 1988, but
China could offer it to Iran and Iraq for delivery
later this year. As a replacement for the older,
shorter range Scud system, the Chinese SRBMs
would appear to be attractive to other Third World
countries seeking a standoff capability for deliver-
ing conventional or chemical weapons
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 et
 to Iran but have been unsuccessful in stopping them.
been especially troublesome, however, because the
missiles enable Iran to threaten shipping in the Per-
sian Gulf and could be used to attack US naval ships
protecting friendly merchant ships that are transiting
the area. Demarches to China from the United States
and other countries have occasionally caused the
Chinese to restrict or temporarily halt arms shipments
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