Analysts of the conventional arms traffic have long understood that international trading patterns are closely related to developments in the world security environment, with changes in the global correlation of forces producing corresponding shifts in the worldwide flow of arms. It should not be surprising, then, to find that the end of the Cold War and the break-up of the Soviet Union have been accompanied by dramatic changes in the character and direction of the global arms traffic. Whereas arms once flowed in great plenty from the USSR to its allies in Eastern Europe and the developing world, today the outflow from the former Soviet Union (FSU) is significantly reduced. Other cold-war trade patterns have also been disrupted, producing a generalised decline in the dollar value of international arms transfers. At the same time, however, we have seen the emergence of new arms trade patterns that reflect the altered power relationships of the post-cold war era. As these new power relationships transform world politics in the years ahead, the arms traffic will continue its own evolution, resulting ultimately in a complete transformation of global trading patterns. To appreciate the extent of this transformation fully, it is first necessary to review the arms trade system of the cold-war era. For much of this period, from the early 1960s to the late 1980s, the global arms traffic was largely governed by the competitive practices of Washington and Moscow. Eager to establish and maintain close military ties with the rising powers of the Third World, the two superpowers offered increasingly sophisticated arms to those regimes willing to align themselves with one or the other of the major blocs. As a result, arms supplied by the two superpowers (and by their close allies) constituted a large share of the global weapons flow: according to the US Arms Control and Disarmament Agency (ACDA), US and Soviet arms accounted for 65% of the total worldwide weapons traffic in 1972-88 (when measured in dollars), while those provided by all NATO and Warsaw Pact countries combined accounted for around 90% of the traffic during this period.' The Cold War competition between Washington and Moscow also governed the direction and composition of the arms flow during this period. In their pursuit of Third World allies, the superpowers concentrated their arms-supply activities in a number of major areas considered pivotal to the global correlation of forces-most notably the Middle East, South Asia and East Asia. As a result, the