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Thursday, December 23, 2010     INTELLIGENCE BRIEFING

Morocco doubles defense spending in arms race with Algeria

WASHINGTON — Morocco, signing major deals with Europe and the United States, has doubled its defense budget.

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A U.S. consultant said the North African kingdom has entered an arms race with neighboring Algeria. The consultant, Forecast International, said Morocco and South Africa have become the leading spenders on defense over the last five years.

"Morocco's defense budget doubled in size between 2005 and 2009," Forecast said. "This development comes as the government supports a series of new arms acquisitions that will allow the country to maintain a balance of power with neighboring Algeria."


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Forecast, in a Dec. 20 report, did not specify Morocco's defense budget. The Newtown, Conn.-based firm said Morocco represented a 13 percent increase in African defense spending from 2005 to 2009.

"Algeria and Morocco have leveraged economic gains to acquire new aircraft and warships, while procurement trends in South Africa are shifting toward ground force modernization," the report said.

Over the last three years, Morocco has ordered the F-16 multi-role fighter and T-6A air trainer from the United States as well frigates from the Netherlands. Rabat was also said to have procured advanced communications and security systems from Western defense majors.

In 2006, Algeria launched an $8 billion military modernization project headed by Russia. The Algerian project has included the procurement of the Su-30 fighter, Yak-130 air trainer and T-90 main battle tank.

Forecast said Algeria's defense projects were financed from energy revenues. The report said Libya and Sudan were also using energy revenue for major military deals.

"This surge in revenue has provided an opportunity for African governments to support much-needed military acquisition and improvement programs, resulting in defense spending growth that has significantly outpaced that of non-petrostates," Forecast said.

Forecast said African defense spending would slow down over the next few years. The report envisioned an increase in African defense spending by more than three percent annually through 2014.

"This cooling trend can be explained by the fact that Africa's overall market growth over the past five years has been driven primarily by a small number of key players," Forecast report author Shaun McDougall, said. "Though less affluent nations have come to rely a great deal on security assistance, the top tier spenders in the region will continue to drive the market as a whole."



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