Reuters Summit – U.S. predicts bumper year in arms sales

The U.S. government is on its way to brokering about $20 billion in arms sales in the fiscal year that began Oct. 1, steady with last year’s near-record total, the Pentagon official responsible for such sales said on Monday.

“We’re forecasting in the $20 billion range” for fiscal 2007, Air Force Lt. Gen. Jeffrey Kohler, director of the Defense Security Cooperation Agency, told the Reuters Aerospace and Defense Summit in Washington.

In fiscal 2006, which ended on Sept. 30, foreign military sales notified to Congress reached $20.9 billion, nearly double the $10.6 billion the previous year.

Last year’s total was second only to 1993, which topped $30 billion, swollen by sales to the Middle East after the first Gulf War.

Regional security concerns tied to Iran and North Korea were helping drive current sales, Kohler said.

He said Saudi Arabia, for instance, was talking to the United States about shore-hugging littoral combat ships that could cost billions of dollars in coming years.

The ships were of particular interest to the Saudi Navy’s Eastern Fleet “that would first confront Iranian aggression if there is any.” The Eastern Fleet also was largely responsible for protecting Saudi oil infrastructure in the Gulf, Kohler said.

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