It is no secret that the region of the Middle East and North Africa is one of the most attractive areas in the world for armament manufacturers and exporters.
According to the Stockholm International Peace Research Institute (SIPRI), five of the 10 largest armament importers in 2014–2018 were located in this region (Saudi Arabia, Egypt, Algeria, the UAE and Iraq). In three cases, Russia was one of the three largest armament suppliers for these countries[i].
As of August 2018, North Africa and the Asia-Pacific Region including India and China accounted for 60% of the portfolio. The Middle East and the Arab Peninsula combined accounted for about 20%, Africa south of Sahara for about 10%, and the CIS countries for 5%[ii]. At that time, the portfolio reached USD 45bn, i.e. the values were USD 27bn, 9bn, 4.5bn and 2.25bn, respectively. It is interesting to point out that, at the end of September, the portfolio of orders from “African countries”, without any specific names mentioned, was described as amounting to USD 3bn. [iii]
A distinguishing feature of this region, from the point of view of the Russian defense industry, is that the clients from that area establish high standards for the armaments they would like to purchase. This often results in a situation when the local clients become pilot customers of many Russian-made armament systems. This happened, for example, in the UAE’s case: the Air Forces and Air Defense Forces of this country became the pilot customer of the Pantsir-S1 air defense missile/gun system, purchasing 50 units based on the MAN SX45 (8x8) chassis in 2010–2013 according to a 2000 contract with the Russian JSC Instrument Design Bureau. Previously, in 1992, the UAE purchased the largest, even by today’s standards, lot of the BMP-3 infantry fighting vehicles, effectively presenting this vehicle to the world market.
Another example is the purchase of the Yak-130 training aircraft by Algeria. This country also became the first full-scale exporter of the Iskander-E missile systems and Mi-28NE attack helicopters. Algeria could reportedly become the first customer of the Su-32 frontline bombers, however this information was not confirmed as of today. It is interesting to note that the second (and so far the last) contract for the Mi-28NE was signed with Iraq, also a country in this region. Egypt also purchased new products, becoming the pilot customer of the Ka-52 attack helicopter and MiG-29М/М2 fighters. Jordan became the first and only buyer of the Il-76MF, the longer version of the Il-76 military transport aircraft. Even Gaddafi Libya had been the first to purchase Khrizantema-S self-propelled ATGM systems, and even receive the first of them before military development commenced.
The mass production factor should also be pointed out. Virtually all contracts with the countries in this region are large-scale ones. Thus, the UAE purchased a total of 815 BMP-3 vehicles and 50 Pantsir-S1 missile systems, Egypt 46 Ka-52 helicopters and 46 MiG-29М/М2 aircraft, Algeria 38 Pantsir-S1 missile systems and 42 Mi-28NE helicopters, Iraq about 300–500 BMP-3 vehicles, 200 Т-90SA tanks, 28 Mi-35М and 15 Mi-28NE attack helicopters. Evidently, this list can go on and on. Such large delivery volumes not only bring revenue to the Russian defense industry and are highly profitable, but also allow to place orders at production facilities and make long-term planning possible.
Finally, this region has recently gained new significance for Russia. An important factor was the commencement of warfare involving Russia in Syria (September 30, 2015). Syria has become a showroom for Russian armaments, many of which got the “combat proved” sticker on them. The military and political success in Syria caused some regional countries previously oriented at Western vendors (primarily Qatar and Saudi Arabia) to show interest in Russian armaments, and sometimes even purchase them, although so far in small lots.
On the other hand, Middle Eastern armament exhibitions have recently become the main sites (along with trade shows in China and India) for Russian armament demonstration after the Russian and CIS exhibitions and shows due to the fact that the largest Western sites had been closed.
Regarding risks in this market, the following ones should be noted. First, the global threat in the form of American sanctions. Regional countries have already met this factor: for example, Egypt, due to a contract for the purchase of the Su-35 fighters. Another risk is the beginning of the Arabic Spring 2.0, since the region’s internal instability can result in reduced armament purchase volumes. A serious challenge has also been ever-increasing competition with the main Western armament manufacturers and China, as well as new players, such as Turkey (that has become very active in the region recently) or South Korea.
Finally, the risk of Russian technological inferiority should be noted, concerning the products offered at the local market, as they have to compete with competitors’ most advanced offers.
Infographics © “New Defense Order. Strategy”
[i] Trends in international arms transfers, 2018. SIPRI Fact Sheet, March 2019.
[ii] Дмитрий Шугаев: Россия нашла способы привлечения новых партнеров по ВТС // РИА «Новости», 20.08.2018.
[iii] Директор ФСВТС: Российское оружие возвращается в Африку // Интерфакс-АВН, 20.09.2018.
Author: Andrey Frolov
© “New Defense Order. Strategy”
Issue 4 (57) 2019, St. Petersburg
