Qatar, Oman set for missile deals in 2013

Gulf states bulking up defences due to a perceived threat from Iran
(Image for illustrative purposes)
By Shane McGinley
Sun 03 Feb 2013 12:25 PM

Qatar, Turkey and Oman are expected to order billions of dollars worth of new missile defense systems this year, according to the CEO of Raytheon, the world’s largest missile maker.

Bill Swanson made the comments during a call with analysts at the weekend, Bloomberg reported.

In November last year, the US Defence Security Cooperation Agency said Oman was interested in buying guided missiles worth US$96m from the US, while Pentagon officials said Qatar is looking to buy US$9.9bn worth of missiles and defence equipment.

Raytheon is looking to international markets to offset White House plans to reduce US defence spending.

The Massachusetts-based defence contractor reported its fourth quarter profit from continuing operations fell 13.5 percent year-on-year to US$466m.

Overall sales grew one percent to US$6.44bn. Raytheon has a record backlog of orders “that bodes well for the next two to three years,” Dave Wajsgras, Raytheon’s Chief Financial Officer, told Bloomberg. International sales may grow 3 percent to 5 percent in 2013, he added.

The growing threat from Iran is the main motivation behind this growth in defence spending in the region, Charles W Moore, Jr, CEO of Lockheed Martin’s UAE operations and commander of the US Navy’s forces in the Gulf between 1998 and 2002.

“From where we stand, it makes sense… These countries are serious about their security and are seeking to defend themselves. Integrated air and missile defence [sales] are growing and it is growing in response to the threat that is emerging. That threat is coming principally from Iran.

“I have been here and operated here for many years. In the last few years, the worry about that threat has increased significantly. As you have read in the newspapers, this region right now is very tense and the guys who are running the countries are paying attention to that and they are making investments to protect themselves.

“So a company like ours has the capability, if you look at our portfolio, it is perfectly aligned to their requirements. So that doesn’t surprise us that they are investing to meet these threats.”

The US and the EU have imposed several rounds of sanctions on Iran to pressure it to give up its uranium enrichment programme. America and its allies believe Iran is looking to build nuclear weapons, despite claims from Iran the programme is for civilian purposes.

According to the latest Global Militarisation Index by the Bonn International Centre for Conversion (BICC), the Middle East is the most militarised region in the world, with all of its countries ranked among the top 40 and three of the six Gulf states in the top ten. Kuwait is considered the most militarised in the GCC, in seventh position globally, followed by Bahrain (9th) and Saudi Arabia (10th).

The high rankings were as a result of a dramatic increase in foreign weapon sales by the US to Gulf states, which tripled in 2011 to US$66.3bn, as regional governments sought to build up their military supplies amid growing tensions with Iran.

Subscribe to our Newsletter

Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.