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Saudi Arabia Defence and Security Report Q1 2013
Business Monitor International, October 2012, Pages: 72
BMI’s Saudi Arabia Defence and Security Report for Q1 2013 examines the country’s strategic position in the Middle East and the wider world. It provides an overview of the contemporary geopolitical challenges facing the country, and the challenges it may face in the future, especially in the context of the ongoing Arab Spring.
In addition, the report examines the trends witnessed in the country’s current and future defence procurement, and the order of battle across its armed forces. The report’s general conclusion is that Saudi Arabia will continue to invest heavily in defence procurement, giving it military superiority over most of its neighbours in what will remain a volatile region. However, the country’s long-term security outlook is less certain. The authoritarian royal family is ageing. Unrest in the country’s Shi’a-dominated Eastern Province remains serious. And regional crises could affect Saudi Arabia in unknown ways.
These foreign crises are numerous from Riyadh’s perspective. Sectarian violence and al-Qaeda continue to plague Yemen to the south. War between Israel and Iran – Saudi Arabia’s regional foe – could have grave repercussions for Riyadh if Iran successfully foments rebellion among Shi’a Muslims in Eastern Province and also Bahrain. Security crises in Iraq and Syria also threaten to upset the regional balance.
However, Saudi Arabia is attempting to engage with other countries in the region, including Iran, in order to reduce the risk of serious instability. In particular, Riyadh has reached out to Tehran by inviting President Mahmoud Ahmadinejad to visit Mecca; the two countries are also members of a new Syria Contact Group set up by the Egyptian government.
However, despite these and other worthy initiatives, there is relatively little that Riyadh can do to address many of the most pressing security challenges that it has to deal with.
Over the last quarter BMI has revised the following forecasts/views:
- Procurement activity dropped off in Q3 following a string of huge defence acquisitions earlier in the year. The one major procurement came in the form of a U$257mn request for ISR suites for use with the Kingdom’s surveillance aircraft; the procurement of more King Air 350ERs could also follow.
- The uncovering of a terrorist plot to set off bombs in Riyadh and Jeddah in September 2012 is discussed. The most serious al-Qaeda operation in the Kingdom in some time, the plot involved two Saudis and six Yemenis – evidence both of homegrown terrorists and also the threat of al-
Qaeda cells based in Yemen.
- The latest unrest in Eastern Province is discussed. Two Shi’a were killed in September during an arrest operation by the security forces, following protests.
- The security situation in Yemen is also discussed. While the new administration of President Abdrabbuh Mansour Hadi has made advances against al-Qaeda, sectarian violence between Sunni and Shi’a flared up dangerously in September, with over 20 people reported to have been killed in gun battles.
Executive Summary 5
SWOT Analysis 7
Saudi Arabia Security SWOT 7
Saudi Arabia Defence Industry SWOT 9
Saudi Arabia Political SWOT 10
Saudi Arabia Economic SWOT 11
Saudi Arabia Business Environment SWOT 11
Global Political Outlook 12
Middle East Security Overview 17
The Strategic Outlook For The 2010s 17
The Middle East In A Global Context 17
Challenges And Threats To Stability And Security 18
Regional Power Dynamics 28
Nuclear Proliferation 30
External Powers 31
Scenarios For The Middle East 33
Scenario Three: Political Liberalisation Takes Hold 34
Security Risk Ratings 35
Table: Middle East And Africa Defence & Security Ratings 35
Table: Middle East And Africa State Vulnerability To Terrorism Index 36
Political Overview 37
Political Risk Analysis 37
Long-Term Political Outlook 38
Saudi Arabia Security Overview 42
Internal Security Situation 42
Table: Insurgent Groups 43
External Security Situation 45
Latest Developments 50
Armed Forces And Government Spending 52
Armed Forces 52
International Deployments 52
Weapons Of Mass Destruction 53
Market Structure 54
Arms Trade Overview 55
Industry Trends And Developments 56
Industry Forecast Scenario 60
Armed Forces 60
Table: Saudi Arabia’s Armed Forces, 2002-2008 (’000 personnel, unless otherwise stated) 60
Table: Saudi Arabia’s Available Manpower For Military Services, 2010-2017 (aged 16-49, unless otherwise stated) 60
Defence Expenditure 61
Table: Saudi Arabia’s Government Defence Expenditure, 2010-2017 61
Table: Saudi Arabia’s Defence Expenditure Scenario – Changing % Of GDP, 2010-2017 (US$mn) 62
Defence Trade 62
Table: Saudi Arabia’s Arms & Ammunition Exports, 2010-2017 (US$mn) 62
Table: Saudi Arabia’s Defence Imports, 2010-2017 (US$mn) 63
Table: Saudi Arabia’s Defence Trade Balance, 2010-2017 (US$mn) 63
Key Risks To our Forecast Scenario 64
Macroeconomic Outlook 64
Company Profiles 68
BAE Systems 68
Thales International 69
BMI Methodology 70
How We Generate Our Industry Forecasts 70
Defence Industry 70