Is Saudi Arabia Rethinking Its Military Priorities?

Ryan Bohl, Middle East and North Africa Analyst, Stratfor: Covid-19 and the collapse of oil prices mean Saudi Arabia will have to rethink its military priorities

* Facing severe budgetary strain due to COVID-19 and low oil prices, Saudi Arabia will likely reduce its arms purchases, while avoiding spending cuts that could impede its internal security or the development of its defense sector.
* Riyadh will be careful not to trim spending that hampers the monarchy's internal security or goal of building its domestic defense production capacity.
* Saudi leadership will calibrate its decisions and seek to limit damage to its Vision 2030 goals, as it keeps an eye on the US presidential election and plans for increasing US scrutiny of its human rights and security policies.

Security vs. Austerity

As it grapples with declining revenue in the first and second quarter of 2020, Riyadh may be cutting or delaying big-ticket arms purchases, as well as altering timetables for payments and deliveries of existing arms deals in its military budget.

Saudi Arabia's GDP is now expected to decline as much as 3.2% in 2020. The kingdom has already enacted spending cuts of around $26.6 billion, tripled its value-added tax (VAT), and ended some mortgage and living allowance subsidies.

* Since King Salman took power in 2015, Saudi Arabia has steadily reduced its share of spending as a percentage of GDP, from 13.3% in 2015 to 8 percent in 2018.
* Saudi military spending has been further reduced by Riyadh's push to draw down its role in Yemen's civil war.

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WNU Editor: Maybe there should be a rethink. But currently Saudi Arabia is still plowing ahead with its defense purchases .... Saudi Arabia to keep buying arms despite austerity (Financial Times).