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There is a growing need for the Kingdom of Saudi Arabia (KSA) to shift from a consumer propelled economy to an industrial economy. This will help KSA in multiple ways. Primarily it would reduce the spending on imports. It would also increase local employment and generate income through exports. Traditional resource sources have been declining with the price of oil falling from $115 a barrel to a current $44 per barrel. Diversification, therefore, needs to be instituted soon. ("Saudi Arabia Emphasises Development Of Local Defence Firms" 1) Of all the avenues that Saudi has to exploit, military development has the widest potential for results. KSA is already globally the third-largest spender in defense after the US and China. Despite the enormous expenditure, the country produces only 7% of its spending. (Pike 1) Since the spending is predicted to expand exponentially, this department will be crucial in driving the economy forward. Key research questions Examine the drawbacks towards industrializing the internal defense system. Determine the potential benefits that can be exploited towards the fulfillment of this development. Evaluate the potential of a KSA defense industry and its significance locally and globally. Relevant literature KSA is the third biggest spender on defense. The current budget is $87.2 billion dollars. This is approximately 30% of the entire budget. Only a negligible of these needs is made locally, and thus the department costs KSA heavily. ("Military Analysis: Saudi Arabia's Armed Forces" 1) Localizing the defense industry has been known to be an efficient tool towards economic development. In the 1960’s, amidst a crisis, Korea’s administration
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