The Murky World of Weapons Dealers

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The money that Ghorbanifar and Khashoggi are howling for may have gone through, or perhaps stuck to, the hands of other, still more shadowy arms merchants. The Reagan Administration has said that North diverted some of the Iran arms money to the contras in Nicaragua. Presumably the funds went through a network of arms dealers, supposedly operating with private donations, who supplied weapons to the anti-Marxist rebels all through the two-year period during which Congress had forbidden direct or indirect U.S. military aid. As far as anyone can tell, the contras seem to have got very little in the way of either cash or arms out of this convoluted pipeline.

The various shadowy transactions that North oversaw seem likely to drag the arcane world of the private weapons dealers into its brightest public spotlight ever. Lawrence Walsh, the independent counsel appointed to look into all aspects of Iranscam, has been empowered to investigate the private networks that supplied the contras. The special Senate and House investigating committees that will hold public hearings probably beginning next month intend to probe the role of the arms merchants as well.

Despite the prominence of Khashoggi and Ghorbanifar in the arms-to-Iran scandal, the world of weapons trading is a tripartite universe in which the private dealers occupy a relatively small part. One estimate puts global weapons exports in 1985 at just over $30 billion, not counting black- and gray-market transactions. About two-thirds of the more or less legitimate trade is conducted by governments selling to other governments, usually quite openly. Weapons-manufacturing companies take the remaining business, drumming up sales through their agents. The manufacturers require the approval of their governments, which may or may not be easy to get. Some governments, notably those of the U.S. and West Germany, tightly control arms exports. Others, prominently including Brazil, Argentina and South Korea, have acquired a reputation for selling to just about anybody. In the West, France has a relatively unrestricted client list; the Soviet Union supplies weapons to leftist governments and revolutionary movements throughout the world.

At the edges of this huge market are the free-lancers. They buy anywhere % they can, sometimes from Communist countries. Nor are they often choosy about their customers: some seem to have dealt with both sides in the Iran-Iraq war. Since 1980, that conflict has put a huge prop under a sagging business. The arms trade has been falling off in recent years, partly because world weapons pipelines are full and partly because governments are increasingly crowding the individual dealers out of what sales opportunities are left. But the demand from the Persian Gulf combatants for weapons to use against each other has created a flourishing market for all branches of the arms trade.