The Shadow World: Inside the Global Arms Trade, By Andrew Feinstein

Arms manufacturers do particularly well when they sell to both sides. Even better is when one side uses lots of expensive weaponry to destroy the other's. That way the arms dealer can make decent profits re-vamping the victor's arsenals. On very rare occasions things turn out even better, especially if the loser gets deposed and the new regime buys weapons from the very same companies.

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Libya was a classic case, starting with several European arms companies doing very well from the Gaddafi regime in the 2000s after it had come in from the cold and went on a buying spree. This carried on right through to the start of the rebellions early this year. Indeed, even as the street protests started in Benghazi in March, French and Italian contractors were still upgrading Libyan army and air force equipment. Just a few days later, much of it was being targeted and destroyed by NATO strike aircraft and submarine-launched missiles.

Now the war is over, NATO will replenish its depleted stocks and the new Libyan government will be only too keen to buy from the same sources. Nor are the sums small. The RAF fired 60 Brimstone anti-armour missiles in the first month, at a cost of £175,000 each, and also used the Storm Shadow air-launched cruise missile at £790,000 a time. Weapon replacement costs for the UK alone are likely to be around £140 million and oil-rich Libya will be a cinch for decent contracts as it replaces all the equipment lost in NATO's 9,600 raids against 5,000 targets.

This hidden side to the Libyan war is one of the most graphic recent examples of the workings of the arms trade, a worldwide industry worth somewhere between $35 and $55 billion: trade that rarely comes under sustained scrutiny. It is true that the last decade has seen a range of good academic books on arms transfers, and throwing light on this singularly murky trade has also been a consistent aim of a few campaigning groups, most notably the Campaign against the Arms Trade.

Even so, one thing that has been missing has been a comprehensive book for the more general reader, along the lines of Anthony Sampson's The Arms Bazaar, back in the late 1970s. Andrew Feinstein's The Shadow World does just this, and in some ways it is even better than Sampson's influential volume. What is particularly useful is the very unusual combination of a thoroughly readable book that also provides a quite extraordinary range of sources - some 2,500 footnotes in all.

Partly because of his experience as an ANC member of parliament in post-apartheid South Africa, Feinstein pays particular attention to the African dimension, writing with a powerful combination of passion and knowledge. His analysis of the South African arms deals with the UK, Sweden and Germany, much through BAE Systems, is particularly revealing. This is just one part of an impressive book that ranges widely over the whole field of arms sales, placing it in the context of the development of major companies through to the present day.

One of his most revealing accounts is of the extraordinary money-making that went on during the war in Iraq and still continues in Afghanistan. As spending reached record levels from 2005 through to 2009, so did the share prices of the manufacturers, with BAE Systems, Lockheed Martin and Northrop Grumman all hitting their peaks in 2008. The war on terror really has been exceptionally good for business.

Throughout The Shadow World, Feinstein emphasises the sheer corruption of the whole process, pointing to the enticements and kick-backs, always overshadowed by the ubiquitous use of "commission" and "agents", as though the distancing of corruption through intermediaries somehow makes it more acceptable. What he seeks to do is open up perhaps the greatest international can of worms of the current era, but this is inevitably an area replete with rumour and all too often affected by conspiracy theories that divert attention from the reality of trading in death.

This is where the value of this book really lies. Feinstein has worked with two researchers, Paul Holden and Barnaby Pace, and many other collaborators, and has succeeded in writing a book that analyses the international arms market with a level of detail and a degree of referencing that may well be unique – what you rarely find in a book aimed at a wide readership. The end result is a kind of hybrid: something close to a work of reference combined with a gripping and sometimes amazing piece of story-telling.

The arms trade spreads its tentacles far and wide, ensnaring politicians in a web of malpractice that rarely comes to light. Feinstein's book is a singularly powerful study, and deserves to be read by anyone who wants to see light shining on such a shadowy world.

Paul Rogers is professor of peace studies at Bradford University