Among developing countries, only the People’s Republic of China and India are ahead of Israel in the field of defense production. A table in the “Strategic Survey 1976” published by the International Institute for Strategic Studies puts Israel third in a list of 31 developing countries which produce at least some of their own military equipment. Egypt and Saudi Arabia are also listed.
According to the table, the Israeli defense industries produce aircraft, missiles, armored fighting vehicles, warships, small arms, electronics and aircraft engines. Besides China and India, only South Africa and Brazil joined Israel in this category.
Israel and China are also singled out as important arms suppliers to other Third World states. In 1977, Israel’s arms exports are expected to be worth $500 million, or double last year’s estimated figure, according to the survey.
Israel’s indigenous capabilities, however, are not considered adequate in number or skills to fulfill her defense requirements. The survey comments that Israel’s arms export trade has become an important means for expanding her own arms purchases. Moreover, “the dependence normally associated with arms transfers does not disappear with the establishment of domestic defense industries.”
SITUATION IN EGYPT
Egypt comes ninth in the table, with plans to produce aircraft and missiles for the Arab military industries organization, launched two years ago with $1 billion by four Arab states. At present, Egypt and Saudi Arabia only produce small arms.
In Egypt, technological developments have decreased rather than increased her freedom of choice as an arms recipient. The survey noted: “The size and cost of Egypt’s Soviet-supplied inventory rules out any strategy for replacing these systems with Western equipment in the near future. For this reason, rather than purchase replacement systems, the Egyptian government turned increasingly to the West and China during 1976 for components that could be used to refurbish its existing Soviet equipment.”
ISRAEL’S POSITION IMPROVED SINCE 1973
Looking at the Middle East military balance, the survey writes that Israel’s position was improved steadily by arms deliveries from the United States worth approximately $2.2 billion. These supplies “undoubtedly put Israel in a stronger position militarily than in October, 1973, despite chronic manpower problems. But it was at the cost of considerable financial strain.”
Saudi Arabia had also developed a growing inter-dependence with the West, especially the United States. American commercial sales to Saudi Arabia were estimated to exceed $2.2 billion in 1976 and American private construction companies reportedly received more than $5 billion in contracts during the year.
The U.S. Army’s Corps of Engineers stated in June that it was managing projects worth in excess of $16 billion. Saudi Arabia had also bought an estimated $1 billion from France since 1974 and was negotiating a similar amount with Britain, the report showed.
But it was with the U.S. that she did most of her business, having concluded $4.4 billion of long-term purchases in 1976 alone. Saudi orders from the U.S. included tanks, artillery, the Hawk air defense system, Dragon and TOW anti-tank missiles, Sidewinder missiles, Maverick missiles, F-5 fighters and light naval craft.
On the prospects for a Middle East settlement, the institute warns that appalling difficulties lie ahead–“not least for Israel, since a settlement can only be built on Israeli territorial concessions.” It warns that if the momentum for negotiations should be lost, the search for a settlement by peaceful means could be overtaken by yet another war.
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