BMI View: Kuwait continues to have a close defence relationship with the US, although Kuwait's role in facilitating terrorism in the region is creating tensions within the relationship. BMI does not believe that Kuwait faces any immediate serious threats to its security. H owever, rapidly changing regional dynamics, and particularly the instability in Iraq, could potentially pose a threat to Kuwait in the long term .
Kuwait is one of the more stable countries in the Middle East, and integrated under the US defence security umbrella, it is generally perceived as a Western ally. However, we believe that its failure to stamp out financing activities on its territory in support of terrorism is creating tensions in its relations with the US. In this sense, the ongoing civil war in Syria and the instability in Iraq throw a shadow over the emirate.
We believe that Kuwait remains an essential base for the US in order to project power into the Gulf, and that the ongoing strength of the defence partnership can be determined from the recent deployment of an additional 2100 marine task force to Kuwait. In our view, Kuwait's continuing contracts for PAC-3 missiles, for example, to boost its air defence capabilities with US defence manufacturers, such as Raytheon and Boeing demonstrate the strength of the alliance.
BMI believe that it is important for Kuwait not to divert from the democratic path particularly in relation to its treatment of the opposition in the domestic arena. We believe that to support long-term internal stability, it is important to include all strands of society in the political process. We believe that political inclusion for the purpose of stability is currently all the more important in view of declining oil prices, which could also affect stability if public spending was ever to be reduced.
On October 15, a top Kuwaiti defence official announced that the state of the Gulf Cooperation Council planned to launch a joint naval force in a bid to protect waters with neighbouring Iran.
In response to criticism from international suppliers, in September 2014, Kuwait suspended its national offset programme in relation to military and non-military contracts with a view to drafting an amended programme by the second quarter of 2015.
The first of two Boeing C-17 Globemaster-III strategic freighters was delivered to the Kuwait Air Force on February 13 2014.
On February 28 2014, the US Department of Defence announced that Kuwait would receive two more Patriot air defence fire units under a USD655.4mn contract awarded to Raytheon.
BMI has awared Kuwait an overall security risk rating of 80 for Q115, which is a slight decrease from the 81 we have been awarding its since 2010.
For 2015, we are forecasting Kuwaits defence spending to reach USD6.7bn, which would represent a 4.8% increase on the USD6.4bn forecast for 2014.
We forecast Juwauts arms and ammunition trade balance to remain in the negative and climbing in absolute terms to USD20mn.
The Kuwait Defence & Security Report features BMI Research's independent forecasts for national and international security, the defence industry, military expenditure, employment in arms production, and arms imports and exports, as well as examining industry trends and prospects, national and multinational arms producers and the regulatory environment.
BMI's Kuwait Defence & Security Report provides professionals, consultancies, government departments, regulatory bodies and researchers with independent forecasts and regional competitive intelligence on the Kuwaiti defence and security industry.
- Benchmark BMI's independent defence and security industry forecasts on Kuwait to test other views - a key input for successful budgetary and strategic business planning in the Kuwaiti defence and security market.
- Target business opportunities and risks in the Asia defence and security sector through reviews of latest industry trends, regulatory changes and major deals, projects and investments in Asia.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. KPIs and latest activity).
Global and Regional Political Outlooks
A strategic overview of the world’s major political risks, identifying countries facing leadership successions and nations at risk of upheaval, inter-state conflict, or separatism and insurgencies, plus a summary of the world’s ‘wild card’ low-probability high-impact risks.
Snapshot evaluation of the major issues affecting the defence and security sectors, economy and politics, with issues subdivided into strengths, weaknesses, opportunities and threats.
BMI Industry Forecast Scenario
Historic data series and forecasts to end-2019 for key industry indicators supported by explicit assumptions, plus analysis of key downside risks to the main forecast.
- Defence Expenditure: Defence expenditure (local currency and USDbn); defence expenditure (% of total budget); defence expenditure per capita (USD); defence budget (local currency and USDbn).
- Armed Forces (to 2012): Manpower available for military service, manpower fit for militaryservice, army personnel, navy personnel,air force personnel, total armed forces, (‘000) (% population).
- Arms Trade: Arms and ammunition exports and imports (USDmn); bombs, grenades and missiles exports and imports (USDmn); revolver and pistol exports and imports (USDmn); weapons excluding guns and swords exports and imports (USDmn).
Political Risk Assessment
Drawing on BMI’s heritage of more than 25 years of Country Risk analysis, this comprehensively evaluates the key risks to domestic politics and foreign relations, focusing on issues most likely to affect either domestic security or the defence sector.
Security Risk Analysis
BMI’s proprietary Security Risk Indices provide investors with a reliable and country-comparable guide to conflict, terrorism and criminal risk, backed up by our analyst’s latest assessment of each component. Furthermore, drawing on our Country Risk expertise, we assess the state’s vulnerability to a serious, or prolonged, terrorist campaign.
Armed Forces Spending/ Expenditure
The reports contain a detailed breakdown of areas of expenditure by the armed forces, these include spending on international deployments, WMDs and missile defence systems as well as individual breakdowns of the cost-per-soldier.
The domestic security overview lists the various potential internal security threats facing a country, ranging from internal security issues such as terrorism, cyber terrorism, crime and drugs, to external security issues including general defence procedures and potential threats from specific countries. The reports also provide a regional overview which details specific issues and flashpoints affecting the Americas, along with potential risks in the coming year.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
The Defence & Security Market reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.