Foreign Military Sales Trend Analysis: Impact on the Future with Application to Taiwan

Abstract

The purpose of this MBA Project is to investigate and provide an analysis of the prominent factors that affect the United States Foreign Military Sales (FMS) program. This project was conducted with the sponsorship and assistance of the Naval Postgraduate School Acquisition Research Program, Financial Management and International programs. The overall goal of this project is three-fold: 1) To identify the purpose of the United States FMS program and its processes 2) To identify, define and evaluate historical economic, political, social and industrial changes and trends that affect FMS worldwide allocation and support and 3) To apply these findings to a specific country (Taiwan) to make a prediction of future participation and support. The role of arms sales in world politics has grown tremendously since the end of World War II and more specifically since the passage of new arms laws in 1979. The importance of FMS is increasingly evident in the foreign policies of both supplier and recipient nations, in international politics, competition and relations. Arms sales have become in recent years a crucial dimension of international affairs. This paper examines several trends in military equipment, services and training exchanges and investigates their potential impact on the future conflicts. The nature of FMS is complex. This research plans to identify and analyze trends relating to sociopolitical, economic, and industrial and technological changes associated with FMS spending. This discussion then applies these findings to Taiwan as a case study and expands on the customer experience with FMS. The intent of this paper is to increase reader knowledge of FMS, pinpoint trends in the program and use FMS to Taiwan as a point of comparison to increase comprehension of this extremely complex and not well-understood program.