Saudi Arabia is now the world’s biggest importer of defence equipment, with spending expected to reach US$9.8 billion in 2015, according to a report from the research firm IHS.
“Growth in Saudi Arabia has been dramatic, and based on previous orders, these numbers are not going to slow down,” said Ben Moores, a defence analyst at IHS.
Planned defence spending in Saudi Arabia shot up following the Arab Spring and the rise of ISIL, leading the kingdom to overtake Russia as the world’s third-largest spender on defence at $80bn annually.
Saudi Arabia’s 2015 fiscal budget was the largest in the country’s history, with total spending expected to reach 860bn Saudi riyals (Dh842.22bn). The budget did not include an estimate for total defence spending, although in 2014 military expenditure accounted for about 35 per cent of planned expenditure.
The UAE and Saudi Arabia imported more arms from the US last year than all of western Europe combined, spending $8.6bn between them on defence imports.
At the recently concluded Idex in Abu Dhabi, 33 deals worth Dh18.3bn were signed, with more than 1,200 exhibitors from 56 countries taking part in the event.
The collapse of state power in Libya, Yemen, Syria, Iraq and Sudan, hostility to Iran and the Arab Spring have concentrated the minds of the region’s defence ministers in recent years.
Last month, Saudi Arabia’s King Salman appointed Mohamed Al Mady, who had been running Sabic, to head up the country’s General Organization for Military Industries, which works to develop the country’s military capabilities.
“There is an immediate military threat emerging on the Saudi periphery,” said Sabahat Khan, a defence analyst at the Institute for Near East and Gulf Military Analysis.
“The threat from ISIL has reached the Saudi border. It’s going to be a battle that will span many years. In Yemen, to the south, the [Houthi] rebels are creating problems … that’s in addition to the long-standing threat from Iran.”
The Middle East is also the world’s fastest growing defence market, with annual spending totalling about $150bn, according to the Stockholm International Peace Research Institute (Sipri).
Global defence spending totalled about $1.75 trillion last year, says Sipri.
“When we look at the likely export-addressable opportunities at the global level for the defence industry, five of the 10 leading countries are from the Middle East,” Mr Moores said.
Governments across the Middle East and North Africa are expected to spend about $920bn on arms over the next decade, IHS estimates.
The global arms import-export trade grew to $64.4bn in 2014, up from $56.8bn the previous year.
The US remains the world’s largest exporter of arms, followed by Russia, France and the UK.
Bilateral trade in defence accounts for less than 1 per cent of the overall defence market. The militaries of Europe and the US, which account for the majority of global arms spending, prefer to buy from domestic suppliers, aiming to boost their own economies.
China, the world’s second-largest spender on defence, is step up its military spending by 10 per cent to $144.2bn in 2015. This is still some way short of the $581bn spent by the US last year.
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