Business Notes

The gulf war is a test not just of armies but of arms, and the big loser is already clear: France. During the Iran-Iraq war, Baghdad laid out $16 billion for Mirage jets, Exocet missiles and other French-made weapons -- close to a third of the Iraqi arsenal. But when the dust settles from Operation Desert Storm, French arms makers may find they have taken as bad a beating as Saddam's soldiers. While American jets and missiles and British aircraft have dazzled the world, Iraq's French-supplied firepower has been drubbed or simply withdrawn.

Military experts say the best way to judge a weapon is in battle, and this is the toughest trial world arms buyers have seen in years. A recent report from the French Parliament warns gingerly that in the global weapons market, "France's place risks being reduced." It already has been. Overseas orders for French military hardware have shrunk 45% since 1988. The Desert Storm debacle is unlikely to bring them back.