WASHINGTON --- The Defense Security Cooperation Agency announces arms sales of $55.4 billion for Fiscal Year 2019. This total increases the three-year rolling average to $51 billion, demonstrating continued strength in the sales of U.S. defense articles and services to allies and foreign partners.
“DSCA and the implementing agencies continue to work hard to improve our responsiveness—as it relates to cost, speed, and capability—while maintaining the transparency, integrity, and long-term commitment to our allies and partners,” DSCA Director Army Lt. Gen. Charles W. Hooper said.
“Allies and partners buy from the United States because we sell the world’s most advanced defense systems. Through the uniquely American approach to security cooperation, we also ensure our allies and partners have all the necessary training, education, and institutional capacity to effectively employ and sustain the equipment we provide.”
Over the last three years, DSCA has participated in a robust, U.S. government-wide effort to reform various elements of the security cooperation process to ensure that U.S. government and defense industry remain competitive in the global market. In 2018, DSCA completed a review of the Contract Administration Surcharge, which is applied to each Foreign Military Sales (FMS) case to pay for FMS contract quality assurance, management, and audits.
As a result of the review, DSCA anticipates lowering the rate from 1.2 percent to 1.0 percent, which will reduce the overall cost of FMS procurements. In addition to reducing costs, DSCA also focused on developing more competitive financing options so allies and partners can align FMS procurements with national budgetary and fiscal cycles. In 2020, DSCA will issue policy changes regarding the development of FMS payment schedules and calculation of termination liability.
DSCA-reported fiscal year 2019 arms sales include $48.25 billion funded by partner nations; $3.67 billion for cases funded by Department of State’s Title 22 grant assistance programs such as Foreign Military Financing and the Global Peacekeeping Operations Initiative; as well as $3.47 billion for cases funded under Department of Defense Title 10 grant assistance programs such as Section 333 train and equip and the Afghan Security Forces Fund.
As part of its ongoing security cooperation reform efforts, DSCA has continued to improve DOD efforts to focus U.S. taxpayer-funded assistance on the right partners, with the right activities, at the right time to address shared objectives and to enhance planning and synchronization between DOS and DOD grant assistance programs. DSCA developed a methodology that better aligns assistance resources with U.S. strategy and improves long-term assistance planning. To this end, DSCA co-chaired the inaugural Joint Security Sector Assistance Review to synchronize DOS and DOD grant assistance activities.
“I am proud of the work DSCA and the entire security cooperation community have done over this last year,” Hooper said. “DSCA and the security cooperation community are emerging from an intense period of reform. That is not to say that we are finished improving as a community, rather quite the opposite. We are establishing a persistent and enduring effort that will drive the evolution of the American approach to security cooperation. I am excited for what 2020 has in store.”