Defense equipment exports for 2012 are believed to have reached $7 billion, a 20 percent increase compared with 2011, according to preliminary Defense Ministry estimates. Final figures will be available in March.

Military exports have fluctuated widely in recent years, and peaked at around $7 billion in 2009-2010. Israel is ranked between fourth and sixth in the world for weapons sales.

Israel exports most of its weapons to the United States and Europe, followed by Southeast Asia and South America. Export to African countries is marginal.

Part of the last year's rise in exports stems from a $1 billion arms deal with Italy. Israel is buying new training jets from the Air Force from Italy, which has undertaken a mutual procurement contract - to purchase goods in like value from Israel. Italy's purchases in Israel include two air control aircraft and an observation satellite - both products of Israel's Aviation Industry.

At a meeting of ministry staff last week, Defense Ministry director general Udi Shani said the ministry anticipates an increase in weapons sales to Azerbaijan, Poland, Vietnam and Brazil this year.

Advancing weapons exports is a major goal for the ministry, Shani said. Apart from strengthening the IDF - by reducing production costs of local systems bought by the army - it contributes to the economy as a whole, he said.

Israel's export of weapons is increasing at a time of a global economic crisis that has led numerous states to reduce weapons purchases since 2008. The crisis may become more acute in view of the United States' planned cutbacks in the defense budget this year.

This is expected to have indirect repercussions on Israel, because reducing the contracts with the administration will force the American industries to seek other markets abroad, increasing the competition with Israel's defense industry.

The Defense Ministry's goal is to export $10 billion worth of weapons a year within a few years. Ministry officials hope to achieve this goal by increasing the investment and aid to small and medium defense industries, whose market share is now quite low.

Ministry sources said all Israel's weapon-export deals are carried out with the Foreign Ministry's approval. Also, Israel would not permit exporting weapons to states that violate human rights, they said.

Open gallery view Advanced Israel Military Industries weapons systems Credit: Moti Milrod