United States Foreign Military Financing

The United States Foreign Military Financing (FMF) program provides grants and loans to friendly foreign governments to fund the purchase of American weapons, defense equipment, services and training. The program was established through the 1976 Arms Export Control Act and is overseen by the Office of Security Assistance within the Bureau of Political-Military Affairs (previously the Office of Policy Plans and Analysis) of the United States Department of State and executed by the Defense Security Cooperation Agency (DSCA) of the United States Department of Defense. The program's stated aims are to promote U.S. interests by "ensuring coalition partners and friendly partner governments are equipped and trained to pursue common security objectives by contributing to regional and global stability, strengthening military support for democratically-elected governments, fighting the War on Terror, and containing other transnational threats including trafficking in narcotics, weapons and persons."

FMF funds eligible governments to purchase U.S. defense articles, services and training through the government-to-government the Foreign Military Sales (FMS) program and purchases made through the Direct Commercial Contracts (DCC) program, which oversees sales between foreign governments and private U.S. companies. FMF does not provide cash grants to other countries; it generally pays for sales of specific goods or services through FMS or DCS.

In 2020, the DSCA reported sales of $50.8 billion under the Foreign Military Sales (FMS) program (an increase of 51% from five years earlier) and $124.3 billion in sales under the Direct Commercial Contracts (DCC) program.

Security Assistance Organizations (SAOs) and military personnel in U.S. embassies play a key role in managing FMF within recipient countries. Some FMF pays for SAO salaries and operational costs. The United States Congress appropriates funds for FMF through the annual Foreign Operations Appropriations Act.