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War in Ukraine revives global arms industry

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Russia-Ukraine war continues to make global arms industry giants earn money, especially the U.S. and Europe. Strong arms companies, particularly in Europe, aim to increase their production capacity to be able to keep up with the orders.

The famous British company BAE Systems, for example, decided to restart the discontinued production of M777 howitzer, which had succeeded in the war. According to the BAE, Central European countries are interested in M777. The company’s vice president, Mark Signorelli, added that they need order of at least 150 new M777 to start production again.

U.S. military approval is expected to start reproduction. New orders are also coming in for American HIMARS and Anglo-Swedish co-made NLAW portable anti-tank missiles.

U.S. based usual suspects Raytheon Technologies, Lockheed Martin and L3Harris Technologies are also winners of the war. L3Harris received an order worth $200 million to be sent to Ukraine. Raytheon has started using obsolete parts from the old Stingers and has called his retired staff back into office to increase production. Lockheed Martin doubled the production of Javelin anti-tank missiles and increased the production of HIMARS rocket launchers and GMLRS missiles by 60 per cent.

The war ‘relieves’ German Industry

Struggling German industry due to the cutting of cheap Russian gas, has been given a consolation called war. Germany’s automotive and defence company and one of Europe’s leading arms manufacturers Rheinmetall AG, acquired the Spanish explosive manufacturing company Expal for 1.2 billion euros. Armin Papperger, CEO of the company, said the customers will sign contracts with companies who have the capacity. According to Rheinmetall, Expal expected sales of around 400 million euros in 2023.

Rheinmetall shares have gained 115 per cent since January 1st. The company announced that it has increased tank ammunition manufacturing from 70,000 to 140,000 in one year. Rheinmetall, which also increased its cannon production from 70,000 to 110,000, also doubled its mortar production capacity. Papperger noted that they increased their potential medium-calibre ball production capacity from 1.2 million to 2.2 million annually and increased their capacity to produce military trucks from 2,500 to 4,000.

Rohde & Schwarz, who developed German military communication equipment other than Rheinmetall, Traton of Volkswagen, who developed military vehicles together with Rheinmetall, and Krauss-Maffei Wegmann (KMW), the manufacturer of Leopard 2 tanks, are also struggling to fulfil orders.

The German government had recently ordered 100 Panzerhaubitze 2000 self-propelled howitzer to be sent to Ukraine. KMW will be responsible for their production. The contract is said to be worth 1.7 billion euros. These howitzers have recently become a hot topic in the German media, claiming that they are the subject of a complaint in Ukraine because of their maintenance.

KNDS, the joint venture between KMW and France’s Nexter says governments should shape new arms contracts. KNDS CEO Frank Haun underlines that they cannot risk increasing capacity with just speeches and announcements.

The German government’s rearmament programme is also an incentive for its struggling economy. Carl Jonasson, CEO of Snigel Design, a Swedish maker of military gear, did not hide the fact that he was surprised by the size of the order they received from Germany in May.

Eastern and Central Europe find new export markets

In addition to German armament manufacturers, the war industry of the former Warsaw Pact countries has also achieved a significant market with the Ukrainian war.

Sebastian Chwalek, CEO of PGZ, the state-owned weapons and ammo consortium in Poland, said they have an important opportunity to enter new markets and increase export revenues in the coming years. The PGZ consortium controls over 50 companies, from weapons to shipping.

PGZ plans to invest 1.75 billion euros in the next decade, Chwalek told Reuters. That’s more than double its pre-war investment plan. The new production facilities will be built away from the border with Russia’s ally Belarus for security reasons, he said.

In 2023, Chwalek announced that they had reached the capacity to produce 1000 pieces of Piorun MANPAD systems. This figure was 600 in 2022 and 300 to 350 in previous years. The company’s pre-war 2022 revenue target was 1.43 billion euros. With the new situation, it is thought that this income will be much higher at the end of the year.

Czechia is also one of the countries that put the arms industry at the service of war in Ukraine. Prague has sold 2 billion euros of weapons and equipment to Kyiv, Czech Deputy Defence Minister Tomas Kopecny told Reuters. Czechia (then Czechoslovakia), the largest weapons producer after the USSR during the socialist bloc period, has realized its highest arms export since 1989.

David Hac, chief executive of Czech STV Group, the largest ammunition producer in Czechia, said that they would create new production lines for small-calibre ammunition and that they were considering expanding its large-calibre capability. Considering the tight labour market, Hajj added, they are trying to get new workers from a slowing automotive industry.

Another Czech war giant, the Czechoslovak Group, nearly doubled its revenues in the first half of 2022 compared to the same period of the previous year. The Group’s spokesman, Andrej Cirtek, said their sales to the Ukrainian army multiplied after the war in Ukraine started.

Surprise attack from South Korea

South Korea, which has become the world’s fourth largest arms exporter, is also one of the winners of the Ukrainian war. The K2 tanks developed by ROTEM, an affiliate of the Hyundai-Kia Automotive Group, are already targeted by many countries from Mexico to Qatar.

Although Seoul has declared that it will not provide lethal aid to Ukraine directly, it is reported that the United States wants to buy ammunition from Korea to send to Ukraine. When details of the deal surfaced in the Wall Street Journal, the South Korean Defence Ministry insisted that they believed the U.S. was the ammunition’s end user.

Despite all these statements, South Korea’s relation with the Ukrainian war is not new. Last September, South Korea inked the largest arms agreement with Poland in its history to supply 1,000 K2 tanks, more than 600 Hanwha K9 self-propelled howitzers and dozens of combat aircraft to Warsaw. This deal will help Poland to send more weapons to Ukraine.

Customers of Hanwha K9 howitzers include Finland, India, Norway, Estonia, Australia, Egypt, and Turkey.

Limits of the arms industry

Under threat of deindustrialisation, the consolation that Europe found in war has its limits. The defence industry’s renaissance may begin to descend again due to the rising cost of materials and energy and dependence on imports from third countries.

Most of the raw materials needed to produce military products are not mined or are mined in limited amounts in EU countries, Jiří Hynek, head of the Association for Weapons and Defence Industry of the Czech Republic, told EURACTIV. Hynek underlined that most of the crucial materials are imported from Asian and African countries.

The materials that are in short supply on the market today are: all packaging materials, many chemicals but also the cellulose required for manufacturing gunpowder, and synthetic rubber, whose prices are astronomical, Hynek said. The latest material is used for ballistic resistant vests, and the EU is dependent on Asia, especially China, for this substance.

The price of steel has gone from 700 euros per tonne to 3500 euros, while aluminium has risen from 5 euros per kilo to 15 euros, according to Paolo Può, president of the Italian military shipbuilder Cantiere Navale Vittoria. Noting that most of their contracts are signed with the state, Può added that they are asking the government for intervention in the sector.

Rheinmetall also announced that they are stockpiling raw materials. The German arms manufacturer said that they purchased aluminium and important plastics in the first place, adding that they also obtained semiconductors to avoid supply problems in the medium term. The company also mentioned they have significantly increased working capital this year.

In France, on the other hand, the war industry has been experiencing production difficulties since before the Ukrainian war due to the semiconductor and chip problems.

Diplomacy

Türkiye, Pakistan, Saudi Arabia defense agreement: An attack on one will be considered an attack on all

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Türkiye, Pakistan and Saudi Arabia signed a joint defense agreement that deepens security cooperation at a time of rising military tensions and conflicts in the Middle East. The agreement stipulates that an armed attack against any one of the three states will be considered an attack against all of them.

Türkiye, Saudi Arabia and Pakistan signed a joint defense agreement at a trilateral summit held in Mecca on Friday, pledging to strengthen collective security, deepen defense cooperation and support peace and stability in the region and beyond.

The “Mecca Joint Defense Agreement” was signed at a summit held at Al-Safa Palace by Turkish President Recep Tayyip Erdoğan, Saudi Crown Prince Mohammed bin Salman and Pakistani Prime Minister Shehbaz Sharif.

According to a statement issued by Türkiye’s Directorate of Communications, the agreement reflects the three countries’ shared determination to strengthen their collective security on the basis of their longstanding historical ties, Islamic solidarity, common strategic interests and close defense cooperation.

The agreement aims to strengthen collective deterrence against any act of aggression and provides that an armed attack against any one of the three countries will be considered an attack against all of them.

The agreement also provides for the development of defense cooperation among the three countries in all fields.

Saudi King Salman bin Abdulaziz Al Saud hosted Erdoğan and Sharif in Saudi Arabia for the summit.

President Recep Tayyip Erdoğan traveled to Saudi Arabia on Friday and met with Saudi Crown Prince Mohammed bin Salman. Pakistani Prime Minister Shehbaz Sharif, meanwhile, arrived in Saudi Arabia a day earlier together with the country’s Chief of Army Staff Asim Munir and performed Umrah in Mecca.

Iran and its allies have been targeting Saudi Arabia and other Gulf countries and obstructing their energy shipments since the United States and Israel launched a war against Iran on February 28, escalating tensions in the region.

According to a joint statement by the three countries, the agreement aims to strengthen collective deterrence against any act of aggression and provides that an armed attack against any one of the three countries will be considered an attack against all of them.

The joint statement did not specify the details of the obligations undertaken by the parties under the “Mecca Joint Defense Agreement.” It noted, however, that the agreement aims to strengthen collective security and promote peace, security and stability in the region and beyond.

A Turkish official told Reuters, “The pact includes a collective defense clause. It is entirely defensive and commits the parties to mutual support solely for defensive purposes.”

The official also said the agreement was not directed against any specific actor, was open to the participation of other countries in the region, and did not invalidate or replace any existing bilateral or multilateral arrangement.

At the same time, the three countries are concerned both about Israel’s increasing aggression and Iran’s expanding influence at a time when their longstanding ally, the United States, is struggling to contain regional turmoil.

Strong political symbolism

Abdulaziz Sager, chairman of the Saudi-based Gulf Research Center, said, “The political symbolism of the summit is significant. Three of the most influential countries in the Muslim world are coming together at a time of growing uncertainty. This shows the increasing willingness of regional and middle powers to coordinate more closely on security issues.”

Sager added, “If the trilateral mechanism is institutionalized and translated into concrete cooperation, it could strengthen the combined diplomatic and defense weight of the three countries while also contributing to the emergence of a security architecture that is more strongly shaped by regional dynamics.”

Türkiye has NATO’s second-largest army. Saudi Arabia, the Gulf’s most powerful country, is one of the world’s largest oil exporters. Pakistan, meanwhile, is the only Muslim country with nuclear weapons.

The Iran factor

Since the war began on February 28, Saudi Arabia has been targeted by Iran as well as its Houthi allies in Yemen and Shiite militias in Iraq because it hosts U.S. military bases.

The conflict has also brought most shipping traffic through the Strait of Hormuz, which carried around one-fifth of global energy supplies before the war, to a halt.

For Saudi Arabia, the consequences of the conflicts in the Middle East over the past three years have been more severe. While the conflicts have endangered the country’s oil exports and ambitious development plans, they have also raised serious questions about the reliability of the U.S. security umbrella on which Riyadh has relied for many years.

A senior Saudi official told Reuters on Thursday that the country expects coordinated attacks in the near future from both Iraqi militias and the Houthis under Iranian direction. This raises questions about how the new alliance would respond to such attacks.

Iran-aligned Welayat News described the agreement as a Saudi request for assistance. The report included the following assessment: “Ansarullah’s Yemen-based equation of ‘blockade for blockade, escalation for escalation’ has put the Saudis under pressure. At Saudi Arabia’s initiative, a defense alliance between Türkiye, Saudi Arabia and Pakistan is expected to be signed today.”

Although Türkiye and Pakistan have avoided major direct attacks, both countries want the conflicts that threaten their own security and economic conditions to be de-escalated.

According to a Reuters report in May, Pakistan deployed around 8,000 troops, fighter aircraft, drones and an air defense system to Saudi Arabia and moved toward developing broader security ties across the Gulf.

Reuters reported in July that Pakistan had also begun negotiations with Kuwait on an expanded security agreement in exchange for energy cooperation and investment.

The AP news agency also noted that the agreement was announced at a time when Türkiye’s relations with Israel have become strained over the conflicts in Iran, Lebanon and Gaza.

Former Israeli official: Türkiye will not fight the Houthis simply because Saudi Arabia asks

Commenting on the defense agreement between Saudi Arabia, Türkiye and Pakistan, former head of Israel’s National Security Council Prof. Jacob Nagel said Saudi Arabia is not as powerful as it appears and described the country as a “paper tiger.”

Speaking to The Jerusalem Post, Nagel said, “You have to understand this: despite all its wealth and weapons, Saudi Arabia is to a large extent a paper tiger. It has a great deal of weaponry and a great deal of money, but militarily it cannot even manage to get through the day.”

On whether Türkiye would defend Saudi Arabia under the agreement, Nagel said, “I do not think the Turks will send their navy and attack the Houthis simply because the Houthis attacked the Saudis. That certainly does not align with my realistic view of the region.”

According to Nagel, Saudi Arabia is therefore looking for alternatives.

“Saudi Arabia understands that it is in serious trouble, both financially and in terms of security. Even before the recent wars, we saw them take the surprising step of signing an agreement with Iran. They did this because they were afraid and felt exposed to the concrete Iranian threat, as well as to Iran’s militias across the Middle East.”

Nagel continued:

“The Saudis’ problem is that despite having the most advanced equipment, aircraft and intelligence capabilities, they do not know how to use this power effectively on the ground. For that reason, all this talk of new alliances with Pakistan or Türkiye should be approached with considerable caution.”

Nagel also said, “This is more of a diplomatic maneuver aimed at putting pressure on the U.S. administration.”

“The Saudis are disappointed with the U.S. position. Particularly in light of the shortcomings they have identified in missile and interceptor ammunition stockpiles in the West, they are trying to send the message that they will not be left alone in the struggle against the Shiite axis.”

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US lawmakers seek terrorist designation for Polisario Front

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US Representatives Josh Gottheimer and Ronny Jackson introduced the “Polisario Front Terrorist Designation Act” to Congress on July 30, calling on the State Department to designate the Polisario Front as a foreign terrorist organization.

The bill, drafted by Gottheimer of New Jersey and Jackson of Texas, alleges that the Polisario Front receives support from Iran and poses a threat to US national security.

Gottheimer said groups linked to the Iranian government were seeking to open a new front against the US and its allies and argued that the Polisario Front had become one of the instruments used for that purpose.

However, Gottheimer also acknowledged that such cooperation between Iran and the Polisario Front has not yet been verified.

“This bipartisan bill will ensure that, once such cooperation is confirmed, US counterterrorism sanctions are fully applied against the Polisario Front,” Gottheimer said.

The proposal follows similar legislation introduced in Congress in 2025, including an initiative by Republican Senator Ted Cruz.

Polisario Front backs Western Sahara independence

The Polisario Front advocates the creation of an independent state in Western Sahara, which is largely under Moroccan control. The movement was founded in May 1973 to fight Spanish colonial rule in the territory.

After Spain withdrew from the territory in 1976, the Polisario Front proclaimed the Sahrawi Arab Democratic Republic, whose government-in-exile is based in Algeria. Morocco soon took control of most of Western Sahara and maintains that the territory is part of its sovereign land.

The name Polisario is derived from the Spanish title “Popular Front for the Liberation of Saguia el-Hamra and Rio de Oro.”

US President Donald Trump recognized Morocco’s sovereignty claim over Western Sahara in 2020 in exchange for Rabat normalizing relations with Israel under the Abraham Accords.

France, the United Kingdom, Germany, the Netherlands and Spain later backed Morocco’s position on the territory.

Morocco, one of Washington’s major non-NATO allies, has continued expanding its military and political ties with both Washington and Tel Aviv. According to the Hudson Institute, designating the Polisario Front as a foreign terrorist organization could further strengthen the US-Morocco alliance.

Morocco sent troops to the Gaza international force

In July, Morocco became the first Arab and African country to commit troops to the International Stabilization Force that is expected to operate in Gaza under Trump’s “Peace Board” administration.

Rabat formally signed the agreement governing its participation in the force on July 15. The International Stabilization Force is expected to operate in coordination with the Israeli military.

A pro-Palestinian Moroccan activist criticized the country’s role in the force, saying: “I do not know what role Morocco will play other than disarming Hamas and perhaps even overseeing the recolonization of Gaza under the US-Israel axis.”

Morocco has continued strengthening military and security ties with Israel since signing the Abraham Accords.

Israeli troops openly participated in Morocco’s annual African Lion exercise in May 2025. The Israeli flag was displayed for the first time during the opening ceremony of the exercise, jointly organized by the Rabat government and US Africa Command and involving about 10,000 troops from more than 40 countries.

Ceuta and Melilla dispute also in focus

The Moroccan government was reported last week to have organized the movement of tens of thousands of Moroccan male migrants toward Ceuta, the Spanish territory on the North African coast.

A US congressional budget report adopted in July also described Ceuta and Melilla for the first time as Spanish-administered cities “located on Moroccan territory” and “long claimed by Morocco.”

Israeli Prime Minister Benjamin Netanyahu had called for Spain to be punished for attempting to block the delivery of US weapons to the Israeli military for use in operations in Gaza. The migrant influx toward Ceuta was welcomed by a significant portion of Israeli social media users.

Responsible Statecraft wrote that the Moroccan government may have resorted to “migration blackmail” to pressure European countries. The publication added: “This time, however, the primary beneficiaries appear to be Israel and the US.”

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Türkiye, Saudi Arabia and Pakistan set to sign defence pact

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Türkiye, Saudi Arabia and Pakistan are expected to sign a joint defence agreement in Saudi Arabia on Friday.

Two regional sources with direct knowledge of the matter told Reuters that Türkiye, Saudi Arabia and Pakistan would sign a joint defence agreement in Saudi Arabia on Friday.

Saudi Crown Prince Mohammed bin Salman, President Recep Tayyip Erdogan and Pakistani Prime Minister Shehbaz Sharif will meet in the Saudi port city as regional powers seek to strengthen security ties during the war with Iran.

Regional powers are seeking to bolster security ties amid conditions created by the US-Israeli war against Iran, which has also drawn in Gulf states and disrupted maritime shipping through the Strait of Hormuz and the Red Sea.

Saudi Crown Prince Mohammed bin Salman is expected to meet President Recep Tayyip Erdogan and Pakistani Prime Minister Shehbaz Sharif in Jeddah on the Red Sea coast.

Pakistani Prime Minister Sharif and Pakistan’s Chief of Army Staff Asim Munir arrived in the country for a visit running from Thursday to Saturday, while Erdogan is expected to travel to Saudi Arabia on Friday, according to the Turkish presidency.

A senior Turkish intelligence source told CNN-News18 that all the core terms of the alliance had been fully prepared, communicated to the parties and accepted by the leaders of Pakistan, Saudi Arabia and Türkiye.

Since Pakistan and Saudi Arabia signed a mutual defence agreement last year, there has been discussion that the two countries wanted to bring other states in West Asia and South Asia into the defence bloc.

Alliance to draw on Saudi finance, Turkish tech, Pakistani nukes

According to CNN-News18, the Pakistan-Saudi Arabia-Türkiye agreement is a natural extension of the Saudi Arabia-Pakistan mutual defence agreement announced last year.

As with the Saudi Arabia-Pakistan agreement, the trilateral alliance will draw on the different strengths of each member state to create an integrated security network.

CNN-News18 said Saudi Arabia would contribute its financial power and regional influence; Türkiye would provide advanced military technology, particularly drones, along with a NATO-standard defence industry infrastructure; and Pakistan would contribute its nuclear capability and battle-experienced military.

The alliance will include joint military exercises, technology transfers, defence industry production and intelligence-sharing.

Under the Saudi Arabia-Pakistan mutual defence agreement, Pakistan had agreed to deploy about 25,000 troops to Saudi Arabia, backed by armoured units, artillery, infantry and rocket forces, as well as two air force squadrons and two naval squadrons. The deployment was said to be intended to contribute to the kingdom’s security, conduct joint operations and train Saudi forces in return for $10 billion in Saudi investment.

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