GAMI Governor Eng. Ahmad Abdulaziz Al-Ohali Highlights Military Spending Growth At Global Defence Conference

Saudi Arabia's military spending has grown by 4.5% annually since 1960, reaching $75.8 billion in 2024. This makes it the fifth largest globally and the top spender in the Arab world. Eng. Ahmad Abdulaziz Al-Ohali, Governor of the General Authority for Military Industries (GAMI), shared these insights at the 25th Global Defense and Aerospace Industry Strategies Conference in Antalya, Turkiye.

The Kingdom's military budget for 2025 is set at $78 billion, accounting for 21% of total government expenditure and 7.1% of GDP. This substantial allocation underscores Saudi Arabia's commitment to enhancing its defense capabilities. The conference was organized by the Defence and Aerospace Industry Exporters' Association (SSI) and the Turkish Presidency of Defence Industries (SSB), with notable attendees including Professor Haluk Gorgun, President of the Defence Industry Agency.

Al-Ohali highlighted that Saudi Arabia's localization rate in military industries reached 19.35% by late 2023, aligning with Saudi Vision 2030 goals. This vision aims to diversify the economy away from oil dependence, boosting private sector contributions from 40% to 65% and non-oil GDP from 16% to 50%. The Kingdom offers a sustainable investment environment in its military sector, providing numerous opportunities and incentives for investors.

GAMI has established policies to support military industry growth, including governance frameworks, export-import regulations, quality standards, intellectual property policies, data security measures, occupational safety guidelines, human capital development strategies, and industrial participation initiatives. These efforts aim to create a conducive environment for both local and international enterprises.

The financial incentives extend beyond major companies to small and medium-sized enterprises specializing in military industries worldwide. Al-Ohali emphasized GAMI's collaboration with sector partners to empower government entities and companies within the military industries sector. This initiative supports localization efforts crucial for Saudi Arabia's economic growth.

A comprehensive study identified 74 supply chain opportunities within Saudi Arabia's military industries. Of these, 30 are prioritized investments representing about 80% of future supply chain spending. GAMI collaborates with public and private sectors to develop these opportunities further.

Incentives for Investors

GAMI works closely with relevant government agencies to offer incentive packages for investors in the military sector. These include framework agreements and financial support such as zero value-added tax incentives. Such measures aim to facilitate localization processes within the industry.

The Governor concluded by urging stakeholders in the military industries sector to capitalize on available opportunities in Saudi Arabia. He stressed that GAMI's developed incentives create a fertile ground for investment in Saudi military industries.

With inputs from SPA