Two Approaches: Why Russia has suffered a setback in the arms markets while Türkiye is achieving success

The war in Ukraine is leading to Russia's irreversible loss of its position in the international arms market. Over the past five years, Russian exports have been half of what they were in 2014-2018, with 2023 sales decreasing by half compared to the level of 2022. The main importers of Russian arms — India, China, Egypt, Vietnam and Algeria — have limited purchases by 35-90%. The main beneficiaries of the market reshuffle have been France, Italy and Türkiye. The experience of Türkiye, which has doubled its military exports over the past five years, is particularly interesting. Türkiye's arms programme was boosted by tensions with NATO partners after the 1974 Cyprus crisis, and the global achievements of Türkiye's military-industrial complex in recent years have been aided by the incredible success of Turkish drones, which are exported to 30 countries. In addition, Türkiye supplies ammunition to the US army and is developing the latest military aircraft and tanks capable of replacing the current generation of European and American combat equipment. In essence, Türkiye is implementing a policy of 'multipolarity' that Russian advocates of a 'special path' once dreamed of. It is simultaneously enhancing its foreign policy sovereignty and inserting itself into international markets and supply chains. This policy sometimes encounters resistance from the West, but Türkiye has thus far managed to balance on the brink of conflict. Russia, on the other hand, closed this path by invading Ukraine.

Russia's arms fiasco

The war in Ukraine is reshaping the global arms market. The main results of this process will become apparent in a few years, when we will see the results of the rearmament processes launched by European countries. But today's data also demonstrates one of the main consequences that is already occurring. For many years, Russia, which held the second position in the ranking of arms exporters, has dropped to third place, behind France, and in the future, it will also yield its position to China and Germany. According to a recent report by the Stockholm International Peace Research Institute (SIPRI), Russian exports in 2019–2023 amounted to less than half (47%) of the volume in 2014–2018.

The last good year for Russian arms exports was 2019, when sales volumes were at the same level as in the previous 20 years, according to the SIPRI analysts. But then it began to systematically decline each year, and in 2023 it was 52% less than in 2022. While in 2019 Russian arms were supplied to 31 countries, in 2023 they were only sold to 12. Purchases of Russian weapons have decreased for all three leading importers: India by 34%, China by 39%, and Egypt by 54% (they account for two-thirds of Russian arms exports). However, Vietnam and Algeria, which are next on the list of Russian arms buyers, have reduced their purchases by 80-90%. The war in Ukraine has undermined Russia's image as a successful arms producer, depleted its defence capacity, and sanctions have undermined their technological potential, making purchases toxic. Essentially, this is another export market from which Russia is successfully 'cutting' itself off, ceding its shares to other manufacturers.

Leaders in global arms exports, 2019-2023, %

Big successes for the home of Bayraktar

In addition to France, which has increased its arms exports by one and a half times over the five years, and Italy (+86%), another beneficiary of the market reshuffle is Türkiye: over the past five years, its foreign arms deliveries have doubled.

Türkiye's experience deserves special attention because, unlike France and Italy, although it is a NATO member, it is pursuing a somewhat independent strategy. Moreover, its current surge is partly the result of sanctions imposed on the country by NATO partners. The successes of the Turkish defence industry are the result of implementing a plan to enhance defence capabilities and increase domestic arms production, the development of which began in the mid-1970s. In 1975, against the backdrop of tensions with allies due to Türkiye's military intervention in Cyprus, the US Congress imposed an embargo on arms supplies to Ankara (it lasted until 1978), and later other countries imposed restrictions on military exports to Türkiye, for example, in 1992 Germany imposed restrictions. The reduction of military cooperation with other NATO members has made it more important for Ankara to ensure the sustainable development of its own military-industrial complex, according to an analytical report by the German Institute for International and Security Affairs (SWP).

Ankara began the process of what SWP calls the recalibration of its military-industrial complex with the establishment of the Defence Industry Agency (SSB) in 1985, the task of which was to invest in production and modernisation programmes for the armed forces. The main focus of SSB's work has been the development of the military aviation industry, including the development and production of fighter jets, unmanned aerial vehicles (UAVs), and helicopters. In 2022, four Turkish companies involved in the production and export of military drones — Baykar, Aselsan, TAI, and Roketsan — entered the list of the world's 100 largest arms manufacturers with total revenues of $5.5 billion. The greatest success was achieved by the Istanbul-based drone manufacturer Baykar, which supplies the Bayraktar TB2 military UAV to 30 countries worldwide. From 2021 to 2022, Baykar increased its turnover by 94%, and in 2023 became the largest arms exporter in Türkiye (its foreign order portfolio amounted to $1.76 billion). The next-generation TB3 drone, which is currently under development, will be made of 100% Turkish components, according to the manufacturers.

National interests and bloc thinking

While Türkiye's total arms exports 10 years ago totalled $1.9 billion, by 2023, it had reached $5.5 billion, largely due to the effective use of Bayraktar TB2 drones in various armed conflicts worldwide, including in Syria, Iraq, and Libya, as well as in Azerbaijan during the 2020 war with Armenia and in Ukraine in February 2022. This has helped Türkiye sign UAV contracts with NATO partners Albania, Romania and Poland. In 2023, Türkiye signed TB2 contracts with Kuwait, worth $367 million, and Bayraktar Akinci drone contracts with Saudi Arabia, worth over $3 billion, making it the largest defence contract in the history of the Turkish defence industry. In addition, Türkiye may become the largest supplier of artillery shells to the United States this year. It is expected that, by 2025, the production lines of the Turkish defence company Repkon will produce about 30% of all 155mm artillery shells needed by the US army. Moreover, this year, the Pentagon purchased 116,000 rounds of ready-to-use ammunition from Turkish company Arca Defence.

Türkiye intends to carve out its own niche in the supply of high-tech weapons. Turkish companies are developing the country's first stealth fighter KAAN (only domestic components will be used in its production), which will be able to replace the outdated fleet of American F-16s. Türkiye has also already launched its first light aircraft carrier TCG Anadolu, which was designed for the F-35 but later converted for the TB3 drone, and in 2023 it unveiled the Altay tank, which is expected to replace the German Leopard 1, Leopard 2, as well as the American M48 and M60.

Burak Elmalı, an expert at the Turkish government-aligned TRT World Research Centre, calls the defence industry the backbone of Türkiye's foreign policy, which, he says, allows Ankara to 'effectively defend national interests and maintain strategic balance on the global stage'. Successful import substitution of Western defence technologies, he believes, has allowed Ankara to avoid political pressure from its allies. As examples, Burak Elmalı cites Türkiye's intervention in the war in Libya, support for Azerbaijan during the 2020 war, and the sale of Bayraktar TB2 drones to Ukraine while maintaining open channels of communication with Moscow (Baykar is currently building a factory near Kyiv to produce TB2 or TB3 drones).

In essence, Recep Tayyip Erdoğan is implementing the policy of 'multipolarity', increasing foreign policy sovereignty and simultaneously integrating into international markets and supply chains based on the expansion of the 'domestic' share of value-added, which was dreamed of by Russian proponents of a ‘special path’, the possibility of which was fatally undermined by the adventurist policies of Putin and his entourage. Unlike Russia, Türkiye is not oriented towards 'bloc thinking' but towards a multifaceted balance of interests. Erdoğan announced the concept of 'The world is bigger than five', which envisages the expansion of international leadership beyond the five permanent members of the UN Security Council. At the same time, Türkiye, while remaining a member of NATO, is competing with Saudi Arabia, expanding its ties with African countries, and increasingly challenging China's dominance in the Arab and Gulf markets, SWP notes.

This policy has met with some resistance from the US and Ankara's NATO partners. Erdoğan's decision in 2019 to purchase the S-400 air defence system from Russia led to Turkish companies involved in the development of the next-generation F-35 fighter jet being excluded from the project and suffering significant financial losses. In 2021, Ankara asked Washington to buy 40 next-generation F-16 fighters and 79 upgrade kits for the current fleet of fighter jets, but the request was blocked by Congress. The deal was only approved after the Turkish parliament approved Sweden's accession to NATO in January 2024. In November 2023, Erdoğan expressed his desire to buy 40 Eurofighter Typhoon aircraft, which are produced by a consortium of Germany, Italy, Spain and the UK, but approval for the deal from Rome and Berlin has not yet been obtained. Berlin blocked the sale of combat arms to Ankara in 2019, due to the conflict in Syria.

However, Erdoğan has managed to successfully balance this bargaining on the brink of conflict and effectively prioritise goals, including balancing political and economic expediency. As demonstrated by the saga with Sweden's accession to NATO: having started the bargaining with purely political grievances against Stockholm, for providing shelter to Turkish oppositionists, Erdoğan then successfully 'traded off' the issue, receiving technological and economic bonuses.