Defense spending in the Middle East will reach $100 billion in 2019, with Saudi Arabia and the UAE taking lead in allocating huge defence budgets.
On average, Middle Eastern countries spend 13 percent of their fiscal budgets on defence annually with Oman and Saudi Arabia spending close to 20 percent and 30 percent, respectively, according to a forecast from defence and security information provider Jane’s by IHS Markit. Out of the top ten defence spending nations per capita, five are in the Middle East.
While Saudi Arabia’s 2019 defence budget is $51 billion, making it the third largest military spending nation in the world, the UAE’s defence budget is growing at a 6.5 percent CAGR and accumulatively over the years to 2021, the country will spend $140.8 billion of which $53.1 billion will be on asset acquisition, the report said.
Rising geopolitical tensions in the Middle East are creating strong demand for military equipment, which is expected to be one of the key drivers of defense-sector growth in the US and elsewhere in the near term, Deloitte Consulting said in one of its reports in June.
"Though the pace of growth in defense spending by the UAE and Saudi Arabia has slowed, their defense [outlay] is significant, and the region is expected to see mid-single-digit growth annually over the next decade,” the report said.
Dubai Air Show
World's leading defence companies including Rafale from France, Raytheon from the USA and Lockheed Martin are expected to display their latest innovations at The Dubai Airshow, which is scheduled to take place between November 17 and 21 at DWC, Dubai Airshow Site. The event is held every two years and is expected to churn more deals in the defense sector.
"When the event takes place, the UAE Armed Forces has the opportunity to interact with potential and existing suppliers, discover new technology and equipment, and network with the key industry players from around the world,” Major General Abdulla Al Hashmi, Assistant Undersecretary for Support Services at the UAE Ministry of Defence said in a statement.
In July, Lockheed Martin was awarded a $1.48 billion contract to build the THAAD missile defense system for Saudi Arabia, bringing the total value of the deal to $5.36 billion, Reuters reported citing the Pentagon.
(Writing by Seban Scaria; editing by Mily Chakrabarty)
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