In December 2008, the U.S. Bureau of Industry and Security (BIS) released its thirteenth annual report on offsets in the U.S. defense trade. This chart displays numbers for the BIS category Middle East/Africa, taken from these reports beginning in 1993. Offsets are a variety of industrial and commercial incentives that defense firms provide to foreign governments to facilitate purchases, from coproduction of particular weapons systems to overseas investment. They have become such big business in the Middle East that a system has evolved to allow defense contractors to bank and trade offset credits like any other investment. Unlike ordinary investments, however, offsets represent transfers of substantial resources to authoritarian governments under conditions of near total unaccountability. Because offsets are usually a percentage of the overall contract value, regimes that spend more on weapons get more in offsets.
