The General Authority for Military Industries (GAMI) will license companies to manufacture firearms, ammunition, military explosives, military equipment, individual military equipment, and military electronics, state news agency SPA reported. The move comes as part of a wider plan to drive the kingdom's economy away from a dependence on oil exports.
GAMI Governor Ahmed al-Ohali said the move would open the door for foreign and local investment in the sector. Investment is needed to meet reforms announced by Crown Prince Mohammed bin Salman who wants Riyadh to produce or assemble half its defence equipment locally in order to create 40,000 jobs for Saudis by 2030.
Saudi Arabia is among the top five defence spenders in the world. A report by the Stockholm International Peace Research Institute (SIPRI) on global military expenditures for 2018 stated that Saudi Arabia has the highest military spending as a percentage of GDP and is third in overall military expenditures at $68 billion, far behind the US ($649 billion) and China ($250 billion)