Defense Industry Europe & Eurasia Middle East Politics & Diplomacy Security & Defense The Gulf Turkey


August 4, 2023

Turkey’s defense industry is on the rise. The GCC is one of its top buyers.

By Ali Bakir

On July 18, Saudi Arabia and Turkey signed agreements encompassing investment, the defense industry, energy, and communications. Two memorandums of understanding in defense, in particular, grabbed the attention of observers and experts, including one with Turkey’s Baykar defense industry corporation, which will sell Riyadh an undisclosed number of state-of-the-art AKINCI Unmanned Combat Aerial Vehicles (UCAVs).

AKINCI is Turkey’s cutting-edge UCAVs capable of executing air-to-ground and air-to-air attack missions. AKINCI entered the inventory in 2021 and only six have been introduced into service since, with a handful of countries close to Ankara successfully acquiring it, including Pakistan. Turkish officials believe that, with AKINCI, Turkey has become one of the top three countries in the world with this technology.

According to Baykar CEO Haluk Bayraktar, the deal signed by Saudi Arabia to acquire Ankara’s modern assault UCAVs is “the biggest defense and aviation export contract in the history of the Republic of Turkey.” Commenting on the size of the deal, the executive of the Defense Industry Agency of Turkey, Haluk Gorgun, highlighted that the Saudi deal to acquire Turkey’s UCAVs is more than $3 billion.

The package is said to include not only UCAVs but also training, technical support, and logistic services. Moreover, the deal will comprise joint production and technology transfer, which Baykar noted “will not only strengthen the bond between the two countries but also contribute to regional and global peace.”

Saudi Defense Minister Khalid bin Salman al-Saud affirmed that the deal comes in accordance with the executive defense plan with his Turkish counterpart and aims to “enhance the readiness of the kingdom’s armed forces and bolstering its defense and manufacturing capabilities.”

During a video message to the sixteenth International Defense Industry Fair (IDEF) held in Istanbul on July 25, Turkish President Recep Tayyip Erdogan confirmed that his country signed the biggest defense export contract in its history with Riyadh, adding that new ones would be added to the agreements.

Turkey’s rising indigenous defense industry

Since the Justice and Development Party (AKP) came to power in 2002, Turkey’s indigenous defense industry witnessed a revolution, which enabled the country to move from being the world’s third-biggest receiver of weapons to the twelfth-biggest arms exporter, according to Stockholm International Peace Research Institute (SIPRI) figures. In less than two decades, Ankara significantly decreased its dependence on foreign military imports from around 80 percent in 2004 to about 20 percent in 2022. Its imports from the US dropped sharply by 81 percent between 2016 and 2020, primarily due to not receiving F-35s and not acquiring Patriot missiles.

During this time, the indigenous defense industry sector kept growing despite obstacles, challenges, and embargoes, thus enabling Ankara to be categorized as an “emerging producer” that aims to amplify production capabilities in aerial, naval, land, electronics, and ammunition domains.

In its March report, SIPRI noted that Turkey’s arms exports increased by 69 percent from 2018 to 2022 compared to 2013-2017, with a significant increase in its share of the global arms trade. According to SIPRI, Turkey’s share of the global arms market doubled during the same period to reach 1.1 percent of global arms exports.

The June report for Turkey’s Defense and Aerospace Industry Manufacturers Association (SASAD) indicated an increase of over 20 percent in the revenue of the defense and aerospace industry sector in 2022 compared to the previous year, reaching $12.2 billion. Spearheaded by the mushrooming sales of its UCAVs—especially the Baykar TB2 drones—Turkey’s defense industry exports hit a record of more than $4.4 billion in 2022, increasing by more than 36 percent compared to 2021.

Turkey’s exports of land and naval platforms are gaining popularity, too. Last year, the land and naval military platform’s exports outperformed their aerial ones. Turkey’s military export target for 2023 is $6 billion, and Turkish officials seem optimistic about not only reaching that number but also exceeding it by the end of this year.

Gulf interest in Turkey’s defense industry

In the last few years, Turkey’s burgeoning defense industry has captured the attention of the Gulf Cooperation Council (GCC) states. Following the 2021 al-Ula agreement, which ended the 2017 GCC crisis and blockade against Qatar, relations between Ankara, Abu Dhabi, and Riyadh improved significantly. Erdogan’s July tour inaugurated a new level of post-normalization period and strengthened ties between Turkey and the Arab Gulf states, especially on economic and security levels.

The GCC countries—particularly Saudi Arabia, Qatar, and the United Arab Emirates (UAE)—are among the top military equipment importers in the world. Western military equipment, especially American and European hardware, dominates the Gulf defense market. During the last few years, more Russian and Chinese weapons have found their way to this market, albeit in a very small percentage. The six GCC countries’ military expenditure exceeds $100 billion. Given Turkey’s rising military profile and growing indigenous defense sector, Ankara eyes a bigger share of the GCC’s defense procurements in the future. 

All GCC states, with the exception of Oman, have defense industry cooperation agreements with Ankara. The interest in establishing cooperation with Turkey on this level is rising. Several reasons might justify this preference from the Gulf perspective. Chief among them are the Gulf monarchies’ desire to diversify their security and defense ties following an era of heavy dependence on the West, as well as their aspiration to build an indigenous defense industry.

In this sense, Emirati, Saudi, and Qatari efforts accelerated following the establishment of EDGE, SAMI, and BARZAN defense entities, respectively, which aim to develop an indigenous defense industry in these countries. Given Turkey’s successful experience in building one, Turkey’s rise as a defense manufacturer aligns perfectly with the GCC’s strategic objectives. Moreover, Turkish defense products are not only highly efficient but also competitively priced, making them an attractive option for GCC countries looking to optimize their defense spending.

Before Saudi Arabia became the biggest procurer of Turkish military equipment—more precisely, UCAVs—several other GCC countries played an increasing role in Turkey’s defense industry by buying more Turkish military equipment or opting for partnerships in projects or production. Between 2018 and 2022, Qatar, Oman, and the UAE were the top three clients of Ankara’s defense industry products, accounting for 20 percent, 17 percent, and 13 percent of Turkey’s total arms exports, respectively, during this period.

In 2022, the UAE reportedly offered the biggest contract to buy 120 Turkish Bayraktar TB2 at around $2 billion. The procurement contract included a request to purchase 120 TB2 drones, as well as ammunition, command and control units, and training services. Despite the strained relationship between the two states in the past, the UAE has consistently been one of Turkey’s major purchasers of military equipment.

Qatar, Turkey’s primary ally in the Gulf since 2014, was the first Gulf nation to acquire TB2 UCAVs. In 2018, Doha signed a contract with Turkey that requested the delivery of six TB2s, three ground control station systems, and a training simulator within a year. At the beginning of 2023, another GCC country, Kuwait, signed a $370 million procurement agreement with Turkey’s Baykar to acquire TB2s.

The Gulf’s interest in Turkey’s military equipment is not limited to Turkish UCAVs. In 2015, Oman signed a mega contract to acquire 172 armored vehicles, including one hundred Pars III 8×8 armored vehicles and seventy-two Pars III 6×6 armored vehicles that were delivered in 2017 and 2018. The contract, the biggest of its kind at the time, elevated Oman to the top of the list of Turkey’s defense equipment customers for a couple of years, strengthened Turkey-Oman defense ties, and boosted Turkey’s defense industry and export strategy.

For its part, Qatar has opted for a major partnership in defense industry products with Turkey. In 2014, Qatar acquired a 49 percent stake in BMC, a Turkish firm known for manufacturing armored vehicles. This collaboration reached new heights in 2018 when a massive contract was inked between BMC and the Defense Industry Agency of Turkey (SSB) to initiate the serial production of Altay, Turkey’s new-generation main battle tank. The deal marked the commitment to manufacture an initial 250 tanks, with plans for an advanced version in the pipeline.

In 2019, BMC was granted the right to operate one of the Turkish military’s premier tank and pallet factories for the next quarter of a century. April was a milestone for the Turkish Armed Forces (TSK), as they received the first two domestically built Altay tanks, celebrated with a grand ceremony led by President Erdogan. Different types of similar partnerships in mega projects are being discussed with other regional actors in the Gulf and beyond, such as Azerbaijan’s participation in Turkey’s fifth-generation fighter jet, KAAN, which is scheduled to make its first flight at the end of this year.

On July 29, the head of SSB uncovered that one of the Arab Gulf countries is in talks with Ankara to acquire a Light Aircraft/UCAVs Carrier (LAC), similar to Turkey’s new flagship TCG Anadolu (L-400), and that talks have currently reached the final stage (the minimum cost of this warship is estimated to be $1 billion in 2015). The undisclosed Arab Gulf country is likely the UAE or Saudi Arabia.

Strategic and economic growth potential

The rising defense industry cooperation between Turkey and the GCC states shows immense strategic and economic growth potential. A focus on “mega agreements” will serve both Turkey’s and the GCC’s interests, fostering long-term plans over immediate tactical considerations. The benefits for the GCC states are substantial, particularly in technology transfer, enhancing their immediate defense capabilities, and nurturing their nascent indigenous defense industries.

To ensure sustainability, this cooperation must remain resilient amidst political fluctuations. As Turkey is introducing its largest warship (the world’s first drone carrier), TCG Anadolu (L-400), its first national main battle tank, (MBT) ALTYA, and its fifth generation fighter jet, KAAN, new avenues for defense collaboration will open between Turkey and the Arab Gulf countries. Furthermore, Turkey’s growing prowess in naval and robotic warfare systems offers efficient, cost-effective solutions to the GCC’s challenges, given its multifaceted vulnerabilities and limited human resources.

Defense cooperation between Turkey and the GCC countries is vital in strengthening regional security and promoting economic development. The growing emphasis on indigenous defense industries, the deployment of advanced UCAVs, and the pursuit of joint defense projects underscore the commitment of these nations to self-reliance and strategic collaboration. As geopolitical transformations continue to shape the region, a coordinated and forward-thinking approach to defense cooperation will enhance Turkey’s security role in the Gulf, benefit the GCC countries, and pave the way for a more stable and secure region.

Ali Bakir is a nonresident senior fellow with the Scowcroft Middle East Security Initiative at the Atlantic Council’s Middle East programs. 

Further reading

Image: Selcuk Bayraktar, chairman of Turkish defence firm Baykar, poses in front of a Kizilelma, company's newest 15 meter jet powered ground attack drone, after an interview with Reuters at Teknofest airshow in Istanbul, Turkey, April 28, 2023. REUTERS/Umit Bektas