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World View : Arms Race, Round 2 : The region that brought you the Gulf War is fast becoming the world's hottest arms bazaar. Exhibit A: Abu Dhabi.


NICOSIA, Cyprus — A "New World Order" is being built. "Peace dividends" are being declared.

In fact, confirms Ian Anthony, an arms expert at the Stockholm International Peace Research Institute, "the single most crucial development in the global arms trade was the end of the Cold War. You no longer have the two superpowers willing to subsidize arms purchases for strategic or ideological reasons. . . . There's no question the market has shrunk."

Still, global spending on weapons of destruction is awesome. The developing world continues to shell out, on average,nearly $70 million daily for arms, ammunition and military hardware, according to the latest figures available. And with the collapse of the Soviet Union, the United States is the world's biggest arms seller.

Moreover, while global arms spending is on the wane, two regions are running counter to the trend. One seems perpetually among the world's most unstable areas. But the other is arming even as it enjoys a period of relative peace and prosperity.

Here are two reports on the world's booming regional arms bazaars, the different forces that are fueling them and their prospects for the future.


For five days last month, dozens of pavilions at Abu Dhabi's International Defense Exhibition were overflowing with arms merchants and weapons buyers from Johannesburg to Moscow, London to Los Angeles and Tehran to Taiwan.

Attending what was billed as the largest and most sophisticated arms bazaar in history--in a land where Bedouins once traded camels for flintlock rifles--manufacturers from 350 companies in 34 different countries vied with defense ministers for hotel rooms in the tiny Persian Gulf emirate. Abu Dhabi was so overbooked due to the show of the latest antimissile missile systems, anti-submarine helicopters and state-of-the-art battleships that many had to stay more than 100 miles away in Dubai or Sharjah, commuting to the fair by helicopter and private jet.

By all accounts, though, it was worth it. And, before the exhibition ended, it had become a dramatic symbol of one of the most frenzied shopping and selling sprees in the history of global arms sales. It was a show of market force that capped billions of dollars in recent weapons deals between the West and the Gulf states--all of them coming in the two years since President George Bush ended the U.S.-led war on Iraq by declaring the beginning of a new chapter of demilitarization in the region.

In Abu Dhabi, there were dazzling two-hour shows of Russia's once top-secret, computer-guided missile systems each day, along with the equally arcane antimissile technology Moscow had designed to destroy them. Abu Dhabi's Port Zayid harbor was tip-to-stern with the latest in anti-submarine warfare vessels--items of particular interest in a region where Iran recently bought three used Russian conventional submarines for nearly $1 billion. For the first time ever, even South Africa had its own pavilion, where it pushed its latest G-6 laser-guided artillery guns.

And, at the height of the weapons fair, the oil-rich United Arab Emirates made international news by announcing its purchase of more than $4 billion worth of French Leclerc main battle tanks--just one of more than half a dozen major regional arms purchases in recent months that, taken together, have made this the hottest market in the global arms bazaar.

The nations of the still-unstable Gulf region have announced deals representing tens of billions of dollars in the past six months alone. They include a huge Saudi order for American F-15 ground-attack fighter jets, Kuwait's orders for hundreds of America's latest M-1A2 Abrams battle tanks and contracts from other Gulf states for high-tech radar systems that have helped bolster U.S. and European arms manufacturers hard hit by the end of the Cold War and domestic military cutbacks.

Defense experts caution that, despite the dramatic numbers, the regional arms buildup remains in its infancy, and weapons purchases in the Gulf during the past two years actually total less than they did at the peak of the Iran-Iraq War, which ended in 1988, and of the global Cold War that ended soon after.

Also, official statisticians who are charting the arms race in the Persian Gulf say it has yet to reach the dollar levels of weapons buying in the Far East--although the Gulf is expected to eclipse the newly rich Asian nations by the end of this year.

But, the weapons-trade analysts added, the Middle East's arms bazaar is nonetheless a booming trade, particularly at a time when the dollar value of the global weapons market has shrunk because both the United States and the former Soviet Union stopped arming client states through heavily subsidized, ideologically motivated weapons programs. And, they stressed, it is the Gulf region and the Middle East as a whole that will remain the hottest and most durable consumer of the tools of destruction, perhaps through the end of the 20th Century.

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