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Pentagon’s $35 Billion 2011 Foreign Arms Sales Misses Goal

Dec. 5 (Bloomberg) -- The U.S. Defense Department struck deals worth $34.8 billion in fiscal 2011 to sell weapons around the world including Afghanistan, Taiwan and India, according to a Pentagon statement today. It missed the agency’s goal of exceeding $46 billion.

The top ten countries that reached agreement to buy U.S. weapons under the Foreign Military Sales program also included Australia, Saudi Arabia, Iraq, the United Arab Emirates, Israel, Japan, and Sweden, the Pentagon’s Defense Security Cooperation Agency said in the annual statement.

The Pentagon had projected such government-to-government sales would reach $36.3 billion for the year ending Sept. 30. The agency fell short of the goal and got only $28.3 billion of such orders. It also missed the overall goal of exceeding $46 billion for the year, including direct commercial sales.

Under the foreign military sales program, the Pentagon acts as an agent between defense contractors and foreign buyers.

In April, Richard Genaille, deputy director of the Pentagon agency responsible for sales, said fiscal year 2011 would exceed $46 billion, “higher than ever” because of demand for jets and air-defense systems.

One of the biggest items that did not go through in 2011 was a potential $6.95 billion sale of Theater High Altitude Area Defense, or Thaad, made by Lockheed Martin Corp. to the United Arab Emirates. UAE has scaled back its request by one-third and, if the sale goes through, the country will be the first international buyer of the missile-defense system.

For 2012 export sales will “hover around $30 billion,” the agency said in the statement. “But official projections are still being calculated,” it said.

To contact the reporters on this story: Gopal Ratnam in Washington at gratnam1@bloomberg.net. Tony Capaccio in Washington at acapaccio@bloomberg.net

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net.

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