Egypt’s annual military spending is anticipated to reach $5.6bn by 2022, witnessing a compound annual growth rate (CAGR) of 6.58%, according to a report by Strategic Defence Intelligence (SDI).
Titled ‘Future of the Egyptian Defense Industry-Market Attractiveness, Competitive Landscape and Forecasts to 2022’, the report offers insights of the Egyptian defence industry.
The allocation for capital expenditure was 16.3% of the total budget between 2013-17, while the nation received military aid of $7.1bn from the US during the same period.
The capital expenditure allocation is expected to grow to an average of 17.1% during 2018-22, and revenue expenditure is estimated to be 82.9% during the forecast period.
The conflict with Ethiopia over the construction of the Great Ethiopian Renaissance Dam (GERD) is expected to drive military expenditure.
Violent clashes and terror attacks after the deposition of President Hosni Mubarak prompted the military to play a more active role in state affairs.
Efforts to enhance maritime surveillance to counter piracy security threats, terrorism and illegal immigration will also affect spending.
Egypt is a key player in the international energy markets as it is the biggest non-OPEC oil producer in Africa. The country is anticipated to apportion 1.2% of its GDP to defence over the forecast period. However, the economic downturn from political unrest and dwindling oil prices is expected to result in a change in expenditure.
The nation is expected to acquire multirole aircraft, helicopters, submarines, radar and surveillance equipment, and cybersecurity systems.