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“The Saudis are essentially engaged in a whole-scale
overhaul of the structure of the regular armed forces, and a
major upgrade of the paramilitary National Guard, which is the
prime internal security force,” said Tom Baranauskas,
Forecast International’s Middle East analyst. From best
initial estimates, the Saudis will be spending about $40 billion
on these procurements, but the total could go as high as $60
billion.
Signed or pending big ticket programs include Typhoon fighters
for the Air Force, helicopters for all of the services, armored
vehicles for the National Guard, new frigates for the Navy,
and a multibillion-dollar security barrier for the entire length
of the border. Notably, the Saudis are spreading the wealth
around, with British, French and U.S. suppliers looking to benefit
the most from the arms-buying spree. The intent is to prevent
the country from becoming dependent on any one supplying nation.
The internal security sector will claim a healthy portion of
the Saudi procurements, with orders to modernize the National
Guard expected to reach some $5.8 billion. This reinforces a
regional trend that began several years ago. The shift in focus
toward security spending reflects growing concerns over the
region’s burgeoning instability, ranging from the civil
war in Iraq to the rise of terrorist attacks in Saudi Arabia,
the persistent violence between Israel and the Palestinians,
and the growing military power of Iran.
The threat from Iran could spark yet another war in the region,
given Iran’s development of long-range missiles capable
of reaching Israel, and Israel’s threat to stage a pre-emptive
strike should Iran persist in developing nuclear warheads. It
is telling that Persian Gulf nations had contemplated defense
spending cutbacks following Saddam Hussein’s ouster in
2003, but have since reconsidered.
Given the various security threats, the region is expected
to continue to constitute a high-value defense market. . Not
surprisingly, Saudi defense spending constitutes a sizable portion
of the increase in forecast spending. However, Baranauskas said
that “much of the arms buying in the region occurs ‘off-the-books,’
and there is no way to determine how much of the defense spending
falls into this category. The region’s governments are
notorious for their lack of transparency, and in many cases
official numbers should be regarded with skepticism.”
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