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Arab states defense spending to hit $80 bln in 2015

With a compound annual rate of 5 percent

The combined defense budget of the GCC states and Jordan is on the increase, with an expected $68 billion rise in defense spending in 2011, a UAE-based newspaper reported on Sunday.

"This is expected to grow to about $80 billion by 2015. It is expected that the overall defense spending in the Middle East will cross $100 billion by 2015... led by Saudi Arabia," John Siddharth, Industry Analyst, Aerospace and Defense Practice, South Asia and Middle East, Frost and Sullivan told Gulf News.

According to Frost and Sullivan’s report, the increased spending is aimed to upgrade existing equipments and augmenting defense capabilities.

“The Middle East alone is expected to surpass about $100 billion in defense expenditure by 2020," Siddharth added.

The Middle East defense market constitutes 3 percent of the total global defense budget, and it is growing at a compound annual growth rate of 5 percent, according to the report.

Saudi Arabia accounts for nearly 60 percent of the total defense spending in the region, and is in the top 10 list in defense spending globally.

Regionally, the UAE comes second in the GCC, and Jordan third.

On October the United States announced one of its biggest arm deals ever to sell up to $60 billion worth of warplanes, helicopters and other weapons to Saudi Arabia.

"The deal would allow Saudi Arabia to procure 84 F-15 fighter jets, upgrades for 70 F-15s, and approximately 150 helicopters including Black Hawks and Apaches," the report says.

Saudi’s homeland security to be second after US

Experts also explain that the Gulf states increased spending is not only to counter Iran as a regional power, but domestic security concerns are also driving defense and homeland security spending, another report revealed.

Criminals and extremists have posed as challenges to local authorities, said a release by Epoc Messe Frankfurt, organizers of the Intersec trade fair and conference.

"This is reflected in the continued growth of the homeland security sector in the region, with Saudi Arabia leading the way," it said, adding that “the cumulated Saudi market for homeland security will become the largest in the world after the United States, and it is expected to be worth around $97 billion in the 2010-2018 period.”

The kingdom boasts 24 separate agencies and organizations, arranged in a three-tier structure, employing more than 250,000 personnel (a number that is expected to grow by an additional 35,000 over the forecast period).