Saudi defence budget hits $60bn

In 2013, Saudi Arabia spent twice as much on defence as the rest of the GCC put together, as fears of regional tensions and fading western support continued to motivate Riyadh. Despite US attempts to reassure the kingdom – including President Barack Obama’s imminent visit – the Saudi defence spend is likely to continue rising. Published in Gulf States News, 20 February 2014

Saudi Arabia has overtaken the UK to have the fourth largest defence budget in the world, with an annual outlay of $59.6bn in 2013, according to newly published estimates from the International Institute for Strategic Studies (IISS), a London-based think tank. Riyadh’s defence spending has been ramped up massively over recent years. From just over SR69bn ($18.4bn) in 2002, the budget for defence and security had climbed to SR251bn by 2013, according to the Saudi Arabian Monetary Agency (Sama – the central bank), whose figures differ slightly from the IISS estimates, and show a defence budget that is even higher.

In part, this is a consequence of a sharp uptick in the nation’s oil revenues through most of those years. Defence and security spending has been held in a range of 30%-35% of the overall budget for more than a decade. But the continued huge outlay on military equipment also looks like a clear statement of intent at a time of tensions with Iran, concerns about a deepening sectarian rift in the region and worries about the US losing interest in the Middle East and turning towards Asia.

No other Middle Eastern country has come close to Riyadh’s investment in its military machine. The next largest spender in the region is Israel, which, including US foreign military assistance, spent $18.2bn in 2013, making it the 14th largest spender in the world. Just behind that came Iran, with an outlay of $17.7bn.

What all this has given the kingdom is one of the largest and certainly the best equipped military forces in the Gulf. It has some 233,500 active personnel, spread across the navy, air force, air defence force, industrial security force and the National Guard. Within its arsenal are many thousand missiles, 600 main battle tanks and 305 combat aircraft, as well as three naval destroyers, four frigates and 69 smaller patrol vessels.

Of course, simply spending a lot of money does not give you a world-class fighting force. Co-ordination between different parts of the Saudi armed forces is poor and decision-making at the highest level is hampered by the age and infirmity of senior ministers. Defence minister Crown Prince Salman Bin Abdelaziz Al-Saud is 78 years old, has had health issues including spinal surgery in 2010, and is thought by some observers to have dementia.

US support?

Such difficulties are not likely to dampen Riyadh’s enthusiasm for defence spending any time soon, however. All the Gulf Cooperation Council (GCC) states rely for their security on the defensive cover provided by the US and European countries, but doubts about the commitment of the US to the region are likely to provide a rationale to spend more rather than less on equipment and training in the years to come.

In October, Riyadh expressed its pique at US policy towards Syria and Iran by refusing to take up a seat at the UN Security Council, despite having lobbied for it. In general, the relationship between Riyadh and Washington appears to be deteriorating, although concerns about the US pivot to Asia may well be overblown. “The GCC states have the overwhelming advantage of having very powerful allies who are not leaving. Not just the US, but British and French forces in the Gulf as well,” said Mark Fitzpatrick, a director at the IISS.

Certainly, the US has been trying to reassure its GCC allies. Defence secretary Chuck Hagel was in the Gulf in December to reiterate Washington’s support, and the White House upped the ante on 3 February when it announced that President Barack Obama would visit Saudi Arabia in March. A statement from the White House described the meeting as “part of regular consultations between our two countries” but it seemed to be rather hastily arranged. Obama, who first visited the kingdom in June 2009, five months after taking office, plans to discuss the strategic ties between the two countries as well as issues of Gulf and regional security. He can expect King Abdullah to look for reassurance about US commitment, to urge him not to trust Iran, and to clamp down harder on the Assad regime in Syria.

In the longer term, it is difficult to gauge the practical consequences of Gulf fears that the US will scale back its presence. In December, the GCC states announced a unified military command and the US has been encouraging them to look at buying weapons collectively, but rhetoric does not always match reality, and there has been no rush for the bloc to act in a more unified way. Over the past few months, the US’ Defense Security Co-operation Agency has announced a string of large arms deals with individual Gulf states, including several with Saudi Arabia.

Among the contracts with Riyadh are a $1.2bn aircraft deal announced on 23 August, a $6.8bn contract for missiles and other munitions on 15 October, a $1.1bn deal for military communications equipment unveiled on 18 November and a further $900m on missiles and associated equipment on 5 December. Kuwait and the UAE have also signed deals with the US during this period, although not on the same scale or with such frequency.

On the other hand, both Saudi Arabia and the UAE are trying to develop domestic defence industries. This is often done through ‘offset’ agreements, which form part of major defence contracts and typically include setting up manufacturing bases in the Gulf along with technology transfer and training. That will continue, but it will take a long time for them to build up the skills required to design and build their own sophisticated weaponry.

For now, the most likely scenario is that Riyadh and other Gulf states will continue to spend heavily on defence while still relying on the US security umbrella. It would not be too much of a stretch to think that Saudi Arabia could even overtake Russia to have the third largest defence budget in a few years’ time. Moscow spent around $68.2bn in 2013, according to the IISS – in other words, just a few large defence contracts ahead of Saudi Arabia.