Arms sales that averaged about 80 billion euros (92 billion dollars) a year in the 1980s have today shrunk to between 30 and 45 billion, according to the ministry.

It attributed the trend to the loss of privileged markets in the Warsaw Pact and in such Soviet allies as Cuba, Syria and Vietnam.

The ministry in addition cited an overall slowdown in orders from the Middle East after "an acquisition phase", in 1995-1997, that followed the 1990-1991 Gulf war.

In the past 20 years, Russia has lost its position as the world's number one arms supplier and is now its fourth largest, after the United States, Britain and France.

But Russia since 1997 has begun to claw back some market share with sales to solvent clients such as China and India.

The defense ministry said the value of French arms exports rose 15.5 percent to 3.12 billion euros (3.6 billion dollars) in 2001 from the previous year.

France controls 12-15 percent of the global arms market, according to the report, which added that US, British and French sales account for more than 75 percent of all global arms exports.

In 2001, the last year for which figures are available, France received orders for weapons worth four billion euros, down from seven billion in 2000.

The fifth largest arms supplier is Germany, followed by Israel, China, Italy, Sweden and South Africa.

The top three importers are Saudi Arabia, which acquired arms worth 7.5 billion euros in 2001, and Taiwan and Turkey, whose purchases were worth 2.3 billion euros each.

WAR.WIRE