Saudi Arabia Pushes to Become Global Defense Hub

Saudi Arabia's objective to localize over 50% of its military spending by 2030 is backed by a formidable budget; the Kingdom is the fifth-largest defense spender globally. As of the end of 2024, the country had reached nearly 25% localization, a significant increase from just 4% in 2018. This initiative is a core component of its strategy to diversify the economy away from oil and to enhance its strategic autonomy. The Kingdom remains heavily reliant on foreign suppliers, with an estimated 74% of its arms coming from the United States. To shift this dynamic, Saudi Arabian Military Industries (SAMI) is actively forming joint ventures. Recent agreements include partnerships with Turkish firms like Nurol Makina, FNSS, and ASELSAN to co-produce armored vehicles and turret systems. Another collaboration with U.S.-based Amentum focuses on maintenance and upgrades for the Saudi Armed Forces' land combat vehicles. The World Defense Show is a key venue for these ambitions. The 2024 event in Riyadh attracted 773 exhibitors and resulted in 61 orders valued at $6.9 billion (SAR 26 billion). During the show, Lockheed Martin announced it would begin manufacturing parts for its THAAD missile defense system within Saudi Arabia. A major hurdle for the Kingdom is the development of a skilled local workforce for the highly specialized defense sector. To address this, the country has established institutions like the National Academy of Military Industries and is focusing on training programs to cultivate local talent in fields such as engineering and cybersecurity. SAMI reported that by 2024, 85% of its nearly 3,600 employees were Saudi nationals. Significant investment in research and development is another critical challenge. In 2022, Saudi Arabia allocated just 1% of its defense procurement budget to R&D, compared to a global average of over 4%. The government has stated its goal is to increase R&D spending to around 4% of its total armaments expenditure by 2030 to foster genuine domestic innovation rather than just assembly of foreign technologies.