Saudi Arabia ups defence spending in face of Iranian threats

Unless relations with regional adversaries suddenly improve, it is unlikely that Saudi Arabia will quickly move to relinquish its newly acquired defence-related titles.
Sunday 09/06/2019
No. 1 arms importer. An unmanned aerial vehicle on display at the Saudi stand on the first day of Egypt Defense Expo in Cairo, last December. (Reuters)
No. 1 arms importer. An unmanned aerial vehicle on display at the Saudi stand on the first day of Egypt Defense Expo in Cairo, last December. (Reuters)

Saudi Arabia has earned a unique double distinction in respect to its defence spending, largely the result of the war against Iran-backed Houthi rebels in Yemen and bolstering security to thwart threats from Tehran.

Riyadh’s positions as a leading global arms spender and the No. 1 arms importer in the world ironically have come as the kingdom seemingly has begun cutting its military spending.

A report by the Stockholm International Peace Research Institute (SIPRI) on global military expenditures for 2018 stated that Saudi Arabia was No. 1 in highest military spending as a percentage of GDP.

There is no doubt that the kingdom’s prioritisation of military-related spending over other budget sectors has been greatly influenced by its 4-year campaign against the Houthis in Yemen, a war that is believed to be costing Riyadh $5 billion-$6 billion a month.

In terms of the overall funds dedicated to military expenditures in 2018, Saudi Arabia was eclipsed by the United States, which spent $649 billion on defence, and China, which spent an estimated $250 billion.

SIPRI said Saudi Arabia was a distant third in 2018 in overall military expenditures at $68 billion, just ahead of India ($67 billion) and France ($64 billion). Russia was sixth, having dropped out of the top five ranking for the first time since 2006, with military expenditures of $61.4 billion.

The top five spenders accounted for 60% of global military expenditures in 2018. Saudi Arabia bumped itself up from fifth place standing on the global military spenders list to third in 2017 — edging past Russia — when Riyadh upped its military spending 9.2% to $69.4 billion, SIPRI’s calculations indicate.

The most significant distinction for Riyadh in the SIPRI analysis is that its defence expenditures for 2018 place Saudi Arabia as the country with the highest military burden in the world — 8.8% of its GDP.

This is in sharp contrast to the two other top spenders: Washington’s hefty defence spending accounts for 3.2% of US GDP and China’s defence expenditures amount to 1.9% of its GDP. The Saudis are in good company, though, with five other regional players not far behind in defence spending as a percentage of GDP: Oman at 8.2%; Kuwait at 5.1%; Lebanon at 5%; Jordan at 4.7%; and Israel at 4.4%.

Estimates by the International Institute for Strategic Studies (IISS) of Saudi military and other security spending suggest an even higher military burden for the kingdom, with Riyadh’s defence-related expenditures accounting for 12.6% and 11.3% of Saudi GDP in 2016 and 2017, respectively.

SIPRI determined that Saudi Arabia is the No. 1 arms importer in the world, accounting for 12% of global arms imports over the last five years. The institute said Riyadh’s arms imports jumped 192% from 2009-13 to the 2014-18 period.

SIPRI attributed the dramatic leap in weaponry purchases to the war in Yemen, deteriorating relations with Tehran and the political fallout between Riyadh and Doha.

During the last five years, Saudi Arabia turned to the United States for 68% of its arms purchases, making Riyadh the top buyer of American weaponry. In turn, Riyadh accounted for 22% of American arms exports over the same period. SIPRI reported that, from 2014-18, the kingdom received 56 combat aircraft from the United States and 38 from the United Kingdom, with aircraft in both cases equipped with cruise missiles and other guided weapons.

Even as Saudi Arabia attained those top rankings in military spending and arms imports, Riyadh pledged to cut the defence portion of its current budget, at least on paper. In announcing the 2019 national budget last December, which included record spending of $295 billion, the Saudi government indicated that it would reduce defence spending 9.1% from $56 billion to $50.9 billion.

Riyadh justified the military-related cuts to freeing funding for other sectors that are the focus of economic development as part of the kingdom’s Vision 2030 fiscal overhaul programme, including infrastructure and transportation and health and social development. However, it is not unheard of that over the years some military-related expenditures have ended up being recorded as off-budget items.

Unless relations with regional adversaries suddenly improve to the degree that Riyadh doesn’t feel under threat, it is unlikely that Saudi Arabia will quickly move to relinquish its newly acquired defence-related titles.

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