World`s defense market climbs to $65 bln in 2015

Monday, June 13, 2016 - 08:30 (EEST) Section: Latest news

The world defense market climbed to $65 billion in 2015, up by $6.6 billion from 2014, the consulting company IHS Inc. said in its Global Defence Trade Report published on Sunday, according to Bloomberg.
”That`s the largest yearly increase in the past decade, according to the Englewood, Colorado-based company. While Saudi purchases jumped about 50 percent to $9.3 billion, growth was seen across much of the Middle East and Southeast Asia,” Nafeesa Syeed wrote in the article entitled ”Saudi Arabia`s Weapons Imports Lead Surge in Global Arms Sales,” posted by Bloomberg on June 13.
The boost in Saudi weapons imports came as the kingdom led a coalition targeting Shiite Houthi rebels in Yemen and as it works to counter its regional rival Iran. Saudi Arabia`s purchases in the past year include Eurofighter Typhoon jets, F-15 warplanes and Apache helicopters, as well as precision-guided weapons, drones and surveillance equipment, the report said.
While Russia has long been the world`s second-biggest arms exporter, France is poised to take that spot by 2018, building on a $39 billion submarine order it won from Australia earlier this year, according to IHS.
Egypt, whose economy has struggled since the 2011 ouster of former President Hosni Mubarak, became the world`s fourth-biggest weapons importer, spending almost $2.3 billion, according to the report. Before 2013, the country spent $1 billion or less annually.
IHS predicts faltering oil prices won`t recover beyond current levels for another three years, so oil exporters will ”have to cut back on procurements,” Ben Moores, a senior defense analyst at IHS Aerospace, Defence & Security who wrote the report, said. ”Countries will spend less on arms and more on operations, as they try to influence events in the region,” he said. Crude has fluctuated at about $50 per barrel in recent weeks, up from $30 to $35 in the first couple months of the year.
Russia, the world`s No. 2 exporter behind the U.S., is likely to increase its trade with Iran as the country begins to replace its aging air force equipment after the nuclear deal reached last year eased international sanctions, the report said. It`s a ”massive” undertaking that could cost $40 billion to $60 billion, Moores said.
The U.S. remained the top weapons exporter in 2015, supplying almost $23 billion in goods and equipment, of which $8.8 billion went to the Middle East, boosted by the sale of aircraft and associated mission systems.
”Going forward, the total may exceed $30 billion as deliveries of the F-35 begin to ramp up,” the report said, referring to the next-generation fighter aircraft built by Lockheed Martin Corp.