Military Exports: Concerns Over Offsets Generated With U.S. Foreign Military Financing Program Funds
GENERAL ACCOUNTING OFFICE WASHINGTON DC NATIONAL SECURITY AND INTERNATIONAL AFFAIRS DIV
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We have reviewed offset arrangements associated with foreign military sales financed through the U.S. Foreign Military Financing FMF Program. For the purposes of our review, offsets are defined as an entire range of industrial and commercial compensation practices provided to foreign governments and firms as inducements or conditions for the purchase of military goods and services. Israel, Egypt, Greece, and Turkey are the largest recipients of the FMF program. Since fiscal year 1975, the United States has provided over 60.1 billion in FMF funding consisting of grants and loans to these countries. Our objectives were to 1 determine the nature and extent of offsets required by the four largest recipients of FMF funding when purchasing U.S. military goods and services 2 determine whether and how U.S. government funds paid for the offsets and their costs 3 analyze applicable laws, policies, and regulations with respect to offsets and 4 make observations on the impacts of offsets on U.S. business, trade, and industrial competitiveness. We did not review offsets associated with purchases made by foreign governments using their own national funds.
- Economics and Cost Analysis