Cuts to spending in the region fell just shy of forecasts, with spending expected to remain flat at USD160 billion in 2022, according to the trusted global agency for open-source defence intelligence

The latest analysis from Janes shows that despite global spending growing 8%, defence spending in the Middle East and North Africa region saw cuts of 5% during 2021.

“The outlook for 2022 remains relatively flat at this point in time at USD159.4 billion, but may return to growth in the coming months as budgets are released and approved,” said Charles Forrester, Lead Analyst for Industry and Budgets (MENA) at Janes. “This is an improvement on the outlook at the end of 2020, when further cuts of 3.42% in 2022 were anticipated.

“A flat-lining of defence expenditure growth in 2022 for the MENA region would allow countries breathing space for their investments – indeed, Janes interconnected intelligence highlights investment currently takes up 17.7% of regional budgets. With some major procurement programmes coming to an end in Kuwait, Saudi Arabia, and Qatar, this may then mean that the expenditure outlays for the completed programmes can be maintained and passed to other projects.”

“Over the past few years there has been some slowing in procurement by some key spenders in the region, with the Covid-19 pandemic and the oil price crash delaying some significant multi-year procurement programmes. Some key spenders in the region have also faced political stumbling blocks in 2020 and 2021 to formally passing a budget, making major equipment spending difficult.”

Oil Prices shore up procurement funds – up a fifth year on year

Janes forecasts highlights that between 2021 and 2026 there is an anticipated 6.33% growth in defence spending in the region, with defence procurement expected to increase by 19.58%, up from the 2.41% growth experienced between 2016 and 2021.

“The challenge of Covid-19 and depressed oil prices hampered planning and contract signatures for some countries, particularly those that rely on off-budget funding for procurement. Now that oil prices are back above USD80 a barrel and traded in excess of USD60 a barrel for most of the year, forward planning on USD-45-50 per barrel oil prices can help a variety of the petro-economies with their wider plans for 2030 and beyond as financial reserves are replenished,” Forrester said.

“Efforts at localising equipment manufacture and diversifying economies away from oil revenues is seeing some countries expand their domestic defence industrial bases, particularly in areas of high-end defence technology where export controls may hamper the ready acquisition of advanced systems.”

“Unmanned systems, combat drones, and loitering munitions have all showed their utility on the battlefield over the past two years, and a race to develop and deploy sovereign technology is now clearly underway. Some countries are collaborating with peers to create new technologies and avoid regulatory stovepipes from foreign suppliers. However, a decentralisation in the development of unmanned technologies away from historical key technology developers means that operators in the MENA region are expected to increase their own expertise in the coming years,” Forrester said.

Fly, fly, fly away – Air power is a key force enabler

Air power – through manned and unmanned assets – is continuing to be a key force enabler for MENA countries to secure their boundaries as well as ensure their territorial integrity is enforced. Such capabilities will range from advanced aircraft, such as the Boeing F-15 Eagle and F/A-18E/F Super Hornet, Eurofighter Typhoon, Dassault Rafale, and Lockheed Martin F-35 Lightning II Joint Strike Fighter, to attack helicopters and light strike aircraft. Similarly, advancements in intelligence, surveillance, target acquisition, and reconnaissance (ISTAR) will drive capability enhancements and acquisitions in the near-term, as regional air forces work to enhance situational awareness and improve responsiveness to major threats such as ballistic missiles.