Tuesday, 27 October 2020
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Guy Anderson, editor and lead analyst, Jane's Defence Industry

The United Arab Emirates is one of the world's true "frontier" defence markets. It is courted by Western firms seeking to offset slumping spending at home; emerging exporters like South Korea seeking to establish a foothold beyond their own borders; and Russia and China under their arms-for-energy-access strategies.

A precarious geographical position, buoyant oil revenues and strong defence expenditure growth (military funding leapt 276 per cent between 2001 and 2010)[1] make the UAE an attractive prospect. There is both the means and the rationale to continue spending on national defence.

The UAE, meanwhile, knows its value to the world market and is looking for a healthy return on its investments. It is looking to defence expenditure to help overcome two pressing problems: firstly, the twin demographic challenges of a young population in need of meaningful employment and a strong reliance on foreign labour (20.9 per cent of UAE nationals were under the age of 15 in 2008 and 73.9 per cent of those of working age were non-nationals)[2] and, secondly, continued high reliance on oil revenues (oil exports accounted for 40 per cent of GDP in 2008).[3]

It is unsurprising that the UAE overhauled its offset regime this year [2010] in order to maximise the social and economic returns on its investment in military materiel.

The reforms have created numerous challenges for foreign industry, however, and may yet backfire by alienating the very firms which the UAE is seeking to work with. Indeed, there have been reports that international defence trade associations are considering sending a jointly-signed letter to the UAE's offset bureau to vent their frustrations (there is a precedent - a similar letter on a similar subject was recently despatched to India)[4].

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By Stephen D King

Published by Yale (ISBN: 978 0 300 15432 0)

Reviewed by Roger Green, Principal Reviewer, UK Defence Forum

Stephen King is the global chief economist for HSBC and is a member of the European Central Bank Shadow Council.  This is his first book and it is unusual of its genre in that it looks at the Western developed markets from the perspective of the emerging markets, particularly that of China.  It is written in a forthright almost textbook style that is detailed and tightly argued with the benefit of 'trivial' examples.  The reader does not have to be an economist to understand the central message but it would help with some of the more complex ideas that King advances.

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By Scott Stewart

The Oct. 29 discovery of improvised explosive devices (IEDs) inside two packages shipped from Yemen launched a widespread search for other devices, and more than two dozen suspect packages have been tracked down so far. Some have been trailed in dramatic fashion, as when two U.S. F-15 fighter aircraft escorted an Emirates Air passenger jet Oct. 29 as it approached and landed at John F. Kennedy International Airport in New York. To date, however, no other parcels have been found to contain explosive devices.

The two parcels that did contain IEDs were found in East Midlands, England, and Dubai, United Arab Emirates, and both appear to have been sent by al Qaeda in the Arabian Peninsula (AQAP), al Qaeda's jihadist franchise in Yemen. As we've long discussed, AQAP has demonstrated a degree of creativity in planning its attacks and an intent to attack the United States. It has also demonstrated the intent to attack aircraft, as evidenced by the failed Christmas Day bombing in 2009 involving Umar Farouk Abdulmutallab, who tried to detonate an explosive device concealed in his underwear on a flight from Amsterdam to Detroit.

A tactical analysis of the latest attempt suggests that the operation was not quite as creative as past attempts, though it did come very close to achieving its primary objective, which in this case (apparently) was to destroy aircraft. It does not appear that the devices ultimately were intended to be part of an attack against the Jewish institutions in the United States to which the parcels were addressed. Although the operation failed in its primary mission (taking down aircraft) it was successful in its secondary mission, which was to generate worldwide media coverage and sow fear and disruption in the West.

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By Scott Stewart

The recent case involving the arrest and deportation of the Russian intelligence network in the United States has once again raised the subject of document fraud in general and passport fraud in particular. The FBI's investigation into the group of Russian operatives discovered that several of the suspects had assumed fraudulent identities and had obtained genuine passports (and other identity documents) in their assumed names. One of the suspects assumed the identity of a Canadian by the name of Christopher Robert Mestos, who died in childhood. The suspect was arrested in Cyprus but fled after posting bail; his true identity remains unknown. Three other members of the group also assumed Canadian identities, with Andrey Bezrukov posing as Donald Heathfield, Elena Vavilova as Tracey Foley and Natalia Pereverzeva as Patricia Mills.

Passport fraud is a topic that surfaces with some frequency in relation to espionage cases. (The Israelis used passport fraud during the January 2010 operation to assassinate Mahmoud al-Mabhouh, a senior Hamas militant commander.) Passport fraud is also frequently committed by individuals involved in crimes such as narcotics smuggling and arms trafficking, as well as by militants involved in terrorist plots. Because of the frequency with which passport fraud is used in these types of activities and due to the importance that curtailing passport fraud can have in combating espionage, terrorism and crime we thought it a topic worth discussing this week in greater detail.

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Germany vs. Argentina, Quarter Finals, Saturday 16:00 [SAST]

Germany's resounding 4-1 victory over England on Sunday has given other nations competing at the World Cup notice that Die Mannschaft ("The Team") is back in the elite of world football. This comes after most commentators -- including German -- wrote off the team as too young and inexperienced to compete with the football heavyweights in 2010.

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By Scott Stewart

STRATFOR is currently putting the finishing touches on a detailed assessment of the Islamic State of Iraq (ISI), the al Qaeda-inspired jihadist franchise in that country. As we got deeper into that project, one of the things we noticed was the group's increasing reliance on criminal activity to fund its operations. In recent months, in addition to kidnappings for ransom and extortion of businessmen which have been endemic in Iraq for many years the ISI appears to have become increasingly involved in armed robbery directed against banks, currency exchanges, gold markets and jewelry shops.

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While the world's best football (soccer) players kick around the ball for a month, the citizens of their respective countries may be distracted from their geopolitical concerns. It should be noted, however, that the highs and lows of football passions have sent countries into fits of bliss as well as occasionally exacerbating geopolitical conflicts from the dissolution of Yugoslavia and ethnic tensions in Spain to a war between Honduras and El Salvador. STRATFOR isn't predicting that the World Cup will cause any conflicts this year. But we'll be watching geopolitics play out at the same time that we're keeping an eye on the football matches.

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By Scott Stewart

Looking at the world from a protective-intelligence perspective, the theme for the past week has not been improvised explosive devices or potential mass-casualty attacks. While there have been suicide bombings in Afghanistan, alleged threats to the World Cup and seemingly endless post-mortem discussions of the failed May 1 Times Square attack, one recurring and under-reported theme in a number of regions around the world has been kidnapping.

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By Scott Stewart

In the wake of the botched May 1 Times Square attack, some observers have begun to characterize Faisal Shahzad and the threat he posed as some sort of new or different approach to terrorism in the United States. Indeed, one media story on Sunday quoted terrorism experts who claimed that recent cases such as those involving Shahzad and Najibullah Zazi indicate that jihadists in the United States are "moving toward the "British model." This model was described in the story as that of a Muslim who immigrates to the United Kingdom for an education, builds a life there and, after being radicalized, travels to a terrorist training camp in Pakistan and then returns to the United Kingdom to launch an attack.

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By Juan Camilo Castillo

A new type of insurgency

Since the end of the Cold War, the notions of low intensity conflicts, armed non-state actors and unconventional warfare have gained a significant attention from the media, policy-makers and the academic world alike. In the post 9/11 strategic environment, these concepts have gained an overarching significance when thinking about international security and stability, especially, when placed in the context of ongoing operations in Iraq and Afghanistan. Certainly, when we revise the idea of an insurgency carrying out an active campaign where guerrilla tactics and terrorism are the tools of choice, it is difficult to separate the notion of violence as a core vehicle for political outcomes. As noted by journalist Robert Taber (in reference to Clausewitz's famous line) "guerrilla warfare" becomes politics through other means. Therefore, normally speaking an insurgency has always been associated with a political cause. For example, the Taliban and Al-Qaida in Iraq want to set up Islamist emirates in their areas of operations, the Tamil Tigers seek the creation of a Tamil Homeland, Shining Path in Peru and FARC in Colombia seek to establish a Maoist and Communist regimes respectively, and so the list goes on.

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