IDEX 2019 demonstrated that both the Emiratis and Saudis are serious about developing domestic defense industries and enlisting global defense firms as partners in this effort.
Arms shows – more formally known as international defense exhibitions – are interesting events, a combination of impressive technology displays, government buyers capable of awarding huge contracts, and jaded journalists trying to get a scoop. But an arms show is often more than it appears on the surface: How a country frames the show, the amount of effort it puts into hosting it, and the announcements that are made there often are the best clues to how the sponsoring country views its defense challenges, and what path it intends to follow in its defense policy.
For analysts of the United Arab Emirates, which is generally tight-lipped about its defense priorities, arms shows are usually the best way to determine how Emirati leaders plan to move forward in their defense acquisition and security self-sufficiency strategies. IDEX 2019 demonstrated that both the Emiratis and Saudis are serious about developing domestic defense industries and enlisting global defense firms as partners in this effort.
Abu Dhabi’s IDEX is one of the best-attended defense shows in the world. In an era of declining global weapons spending, the Emiratis remain one of the largest cash buyers. The Emiratis have a deserved reputation for buying first-rate equipment and for spending quite a lot of money – around $1 billion per year on weapons imports – and patient development of their armed forces has earned them the moniker “Little Sparta.” IDEX is always a popular arms show – the UAE is perfectly located in the big weapons market of the Middle East, halfway between suppliers and buyers in Europe and Asia. It is the opportunity for most of the world’s defense industry to focus on the Gulf Arab states’ interest in acquiring sophisticated weapons systems.
Laying the Groundwork
The Emiratis sent a serious message to global weapons suppliers just before the IDEX opening by announcing new “offset” rules. Offsets require weapons suppliers to invest some portion of the proceeds from weapons sales – usually expressed as a percentage in dollars – in the purchasing country to “offset” the expense of buying imported weapons. Countries may also insist on domestic production of certain weapons and technology transfers from the vendor to the purchaser. This is a long-standing practice in many countries. One aspect of the new offset program is to allow companies to spend in a wider range of sectors in the UAE, not just in the defense sector. While the details of the new policy are still unclear, the general principles announced are viewed as an improvement by most analysts and weapons vendors.
The week before the show, the Emiratis announced the formation of a Defense and Security Development Fund, which aims to incubate and stimulate local defense industries. Initially capitalized at about $680 million, the fund announced a number of awards to and investments in local defense firms during the show. These included high-tech applications such as improving the accuracy of precision guided munitions and were clearly made with an eye not just toward self-sufficiency but also toward weapons exports.
The Emiratis also attempted to spur technological development by announcing a government-funded prize for academics who produce developments in military pyrotechnics (such as signal flares or illumination rounds) in the UAE. The prize, similar to U.S.-government prizes for self-driving cars, offers up to $1 million for the best new proposal.
The Show Must Go On
With a Cast of Thousands …
IDEX generally draws more countries as exhibitors and purchasers than do most weapons shows. This year there were over 1,300 exhibitors (an increase of 6 percent over 2017). About 15 percent of the exhibitors were from the UAE. In addition, Western weapons suppliers, and Chinese and Russian defense firms, also traditionally are present. China had one of the largest areas in the show, with an entire corner of the mammoth exhibition center. Other exhibitors included Ukraine, Sudan, South Africa, and Jordan.
While there were no major Russian or Chinese buys announced at IDEX, just being present seems to send a strong message to Western companies that the Emiratis, Saudis, and others in the region have options. Additionally, an announced sale of $8.2 million worth of Chinese 155 mm artillery rounds had the indirect effect of confirming that the Emiratis had purchased Chinese howitzers. The Chinese, in particular, have seemed to profit in recent years from the United States’ principled refusal – based on considerations such as a reluctance to start regional arms races or compliance with the Missile Technology Control Regime – to sell certain types of weapons to the Gulf Arab states, such as armed drones. As a result, both the Emiratis and Saudis have in the past few years purchased and deployed the Chinese Wing Loong armed drone.
And Billions Spent …
This year some trends stood out. There is always a “push” by the host country at these shows to announce a big purchase – something to get vendors to return the next time. This time was no exception: There were $5.4 billion worth of UAE purchases announced during the show. However, there wasn’t really a big procurement purchase made: Most of the sales were for sustainment of existing equipment rather than purchases of new equipment. One of the biggest sales of the show was an award of over $1.5 billion to Raytheon and Lockheed for upgraded Patriot missiles and launchers, though part of this sale was initially approved in 2017.
At Home and Abroad …
One trend in Middle East arms shows is the rise of domestic companies as part of a general regional desire for greater autonomy. IDEX continued this trend. The Emirati company Tawazun (in partnership with the Turkish company Otokar) displayed the co-produced Rabdan armored vehicle, which is currently in service with the Emirati armed forces. Additionally, the Emirati firm Calidus announced a partnership with a Saudi firm to jointly manufacture and market a light attack aircraft, the B-250, across the Middle East and North Africa. This would represent a relatively advanced Gulf Arab weapon system produced for export, and at the same time would fill a number of smaller countries’ requirements for low-cost persistent aerial strike and ground support capability.
The Emiratis were not the only group busy at IDEX. The Saudis, who are seeking to develop a significant domestic military industry as part of Vision 2030, signed a number of agreements with foreign companies. For example, the U.S. defense company L3 signed an agreement with Saudi Arabia’s new national defense entity, the Saudi Arabian Military Industries company, to jointly develop electro-optical technology. The Saudis also signed agreements to jointly develop capabilities with European firms.
Regardless of Politics …
Both the UAE and Saudi Arabia are making a well-funded and supported effort to develop indigenous arms industries, which may one day not only meet domestic requirements but export as well.
While many observers were focusing on the displays, both the Emiratis and Saudis were using IDEX as a venue to promote vital but less photogenic defense reform measures. The Emiratis adroitly used the opportunity to stimulate development of their domestic weapons industry in high-payout areas. The Saudis took advantage of IDEX’s role as the premier regional arms show to sign a number of cooperative deals with defense companies.
IDEX has evolved from a marketplace for equipment to a forum for comprehensive defense cooperation – including research and co-production.
These remarks do not reflect the view of any university or U.S. government agency. The author was assisted in research for this article by Drew Abbott of Roger Williams University and Victoria Ramirez of Texas Tech University.
The views represented herein are the author's or speaker's own and do not necessarily reflect the views of AGSI, its staff, or its board of directors.
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