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roachboy · 04-06-2011, 09:04 AM

i was looking around in janes defense weekly, which is always a creepy pass time unless you like the transnational weapons bazaar (one result of which is situations like the action in libya using weapon systems from one area of the bazaar to neutralize weapon systems for other areas of the bazaar). here's an analysis about longer-term implications of the ongoing turbulence in north africa/middle east.

Quote:

Turbulence in the Middle East and the implications for the defence trade

Guy Anderson Jane's Defence Industry Editor
London

Political unrest in the Middle East and North Africa threatens to hamper defence trade agreements in the short term and reshape the military procurement landscape in the longer term, writes Guy Anderson

That political turbulence in the Middle East and North Africa will have some consequences for defence trade is almost self-evident.

Ministries across the region have found their attention diverted from procurement programmes to pressing operational issues, while efforts to placate popular concerns through far-reaching spending programmes already appear to be channelling government funding away from military procurement programmes in some quarters.

As an example, the government of Iraq was reported in late February to be shifting a USD900 million fund allocated to underpin the country's F-16 Block 52 fighter aircraft programme: an accord valued at up to USD4.2 billion when it was last raised in September 2010.

Whether other governments follow suit remains to be seen, although the scale and abrupt nature of social programmes (such as Saudi Arabia's announcement of a USD36 billion package to address inflation, housing, social security, employment and education concerns) suggests that military procurement in general may suffer delays and cancellation in the short term.

This alone is cause for concern, given that the leading markets of the region - Algeria, Egypt, Kuwait, Morocco, Oman, Saudi Arabia and the United Arab Emirates (UAE) - dedicated a total of USD30 billion to procurement in 2010 (according to Jane's figures) and the Middle East is in the sights of the bulk of world materiel exporters as a means of offsetting decline elsewhere.
Lessons of the unrest

Potentially a bigger question is how the current upheaval will change the defence procurement landscape in the Middle East and North Africa, and whether lessons learnt today will change purchase patterns in the longer term.

Jane's argues that the existing trend among some markets (such as Saudi Arabia and the UAE) towards broader procurement relationships (with historical reliance on Western suppliers gradually being diluted by procurement accords with re-emerging powers such as Russia) may accelerate.

Efforts among Gulf states to broaden alliances to encompass Moscow and Beijing have been driven by the shifting balance of global influence and (certainly in the case of China) burgeoning bilateral trade over the last five years.

To these drivers we may add lessons learnt from the West's reaction to current events: specifically, the abrupt cancellation of military and security export permits (such as the UK's suspension of a series of export licences relating to Bahrain) and the spectre of military materiel embargoes in response to the threat of domestic oppression.

Egyptian President Hosni Mubarak's fall from office after a relatively brief (albeit intense) period of domestic upheaval may also carry unintended lessons for heads of state elsewhere in the region.

Mubarak's four-decade regime's acquiescence to US foreign policy (and willing receipt of US materiel as a result of the 1979 Camp David accords) did not translate into personal support. The unspoken "arms procurement for security" pact that apparently applied elsewhere in the region may not, therefore, be taken as a purchase of personal support for individuals.
Libya - arms embargo

Of the reactions to recent events in the Middle East and North Africa, it is perhaps the UN sanctions against Libya (resolution 1970 - agreed on 26 February) that carry the most intriguing lessons.

Arms embargoes typically shift relationships, as with the 2006 US embargo against Venezuela that led President Hugo Chavez to enter into multi-billion dollar materiel accords with Russia. However, the measures against Libya attracted unanimous UN Security Council backing, with Beijing and Moscow backing the resolution alongside fellow permanent members France, the UK and the US and current members Bosnia and Herzegovina, Brazil, Colombia, Gabon, Germany, India, Lebanon, Nigeria, Portugal and South Africa.

The backing of China and Russia may be viewed as pragmatic, given that Moammar Ghadaffi's regime appeared to be entering its final days at that stage and the need for alignment with successors, but it may also have marked a significant shift in China's approach to international affairs. Beijing may have been driven on this occasion to reassess its historic policy of non-interference in the internal affairs of other states. Given the potential for China's interests to be harmed by upheaval elsewhere in the region and beyond, it is plausible that Beijing's approach to international relations may have evolved.
Enter Turkey

Turkey's position as virtually the only significant voice of dissent against the UN sanctions may also prove significant. While not in a position to vote, Prime Minister Recep Tayyip Erdogan made his opposition to the measures very clear through public statements.

Turkey is a rapidly emerging defence exporter with global market ambitions. Opposition to the Libyan embargo - taken with Ankara's vote against the last round of UN sanctions against Iran in 2010 - may be viewed as a statement of independence in export markets. Turkey has already made some in-roads into the Middle East markets, and is therefore likely to be keen to promote its systems as a 'safe bet' without the threat of future impediments.
Moscow and Beijing - Middle East and North African relations

A greater shift towards alignment with Russia and China by Middle East and North African powers would not, of course, point to a new trend: substantial in-roads were made throughout the 2000s.

For example, warming relations between Moscow and Saudi Arabia over the last five years has led to defence trade that would have been inconcievable during the Soviet era, such as a materiel package valued at between USD2 billion and USD4 billion that has been under discussion for at least two years. China also penetrated the kingdom's market in 2007, albeit at a low level, with the sale of Norinco PLZ-45 155 mm self-propelled guns.

Russian and Chinese efforts have been mirrored to varying degrees elsewhere in the region.

The strength enjoyed by Moscow and Beijing has been their ease of aligning defence trade packages with wider issues ranging from strategic relations to energy supply, facilitated by vast state ownership of defence, financial and energy ventures. Military materiel accords offered by Moscow, for example, have often included elements of sovereign debt forgiveness, energy exploitation and industrial co-operation.

The fact that the two emerging powers have not, in general, shown themselves to be fickle friends is also notable. Procurement contracts involving Moscow and China have not faced the sort of publicity that was attached to past Saudi Arabian accords with Western suppliers. Likewise, there is less threat of future embargoes.

The depth of European and US penetration of markets such as Bahrain, Kuwait, Oman, Saudi Arabia and the UAE suggests that major change to the profile of suppliers in the near-term is not plausible. The risk of Western organisations being cut off from such markets is extremely limited. However, far greater competition in the future is highly likely.

nb: i can't post a link to this because the url runs through a proxy. you'd not be able to access it anyway. if you have access to janes, this was posted on 11 march of this year.