BUILDING FUTURE READINESS

This policy emphasis changed following the collapse of Communism in the early 1990s. Capitalism had won the ideological battle, ushering in an epoch of liberalisation, open markets and free trade. At the same time, the 1990-91 Gulf war erupted, marking the beginning of what came to be known as the ‘revolution in military affairs’. This reflected Western dominance, but also a new network-centric capability and related advanced technologies.

The conduct of war had changed irrevocably and the arrival of high-cost R&D-intensive military technologies in an era of globalisation proved the death-knell of defence industrial sovereignty. Cost reduction became the principal driver of defence acquisition policy, accelerating the internationalisation of supply chains and the privatisation of defence contractors for whom profit maximisation became the chief goal.

The mix of globalisation and liberalisation impacted both the civil and military arenas, intensifying competition and stimulating innovation. This synergistic relation was expressed via dual-use technologies. These have always been around in the form of machine tools and radar, but entering the new millennium, their role and influence became pervasive. As Elon Musk observed in 2020, the world was witnessing “the end of the military industrial era”, which was being replaced by a continuous process of civil-military innovation known as the Fourth Industrial Revolution (4IR).

The conventional defence industrial base that was focused solely on ‘platform’ manufacture had now become a defence industrial ‘ecosystem’, symbolic of disruptive innovational change spawned by R&D-intensive investment.

The 21st century defence industrial ecosystem encompasses a wide array of civil-military capabilities; these include specialised, innovative supply chains, university engineering centres of excellence, science, technology, engineering and mathematics (STEM) skills and R&D institutes.

Significantly, the dual-use character of the defence ecosystem means that it no longer ‘crowds out’ but ‘crowds in’ scarce economic resources. In this sense, defence has become a force of economic good, simultaneously strengthening defence resilience and economic security – the principal components of comprehensive national security.

Importantly, the recognition that defence and economic prosperity are intertwined is not solely the preserve of the advanced nations; in 2026, all states understand the significance of this connection.

The recent emergence of so-called middle powers is instructive in their ability to leverage the fusion of defence and economic forces to accelerate their transition from dependent power to independent power status. It is also likely that the present Gulf crisis will act as a further inflexion point that will see the Arab middle powers aggressively push for strategic autonomy after becoming entangled in a conflict threatening their territorial sovereignty and economic security.

The UAE is one such middle power that is on the frontline of the crisis. Its security has been threatened on several different levels, and especially by the inability of Washington’s Foreign Military Sales (FMS) programme to keep to its delivery schedules.

This vulnerability is, of course, of immediate concern, but the proactive UAE leadership has long been taking steps to reduce its dependency through the development of an alternative sovereign defence-economic security architecture.

The UAE interprets national resilience through the lens of what it terms ‘readiness’, based on a system-of-systems model. Readiness is grounded in partnership, which identifies the central thrust of industrial policy as innovation, along with the talent required to sustain high-technology transformation.

‘Innovation with discipline’ is the core policy theme, far removed from the Western market-led model. Rather, the UAE adopts a state-backed, interventionist, outcome-driven approach, where, for instance, the UAE Ministry of Industry and Advanced Technology offers incentives and regulatory support to sponsor artificial intelligence (AI), space (the Emirates Mars Mission) and the energy transition.

To support the internalisation of knowledge, the UAE promotes the transfer of operational know-how through defence offset programmes, led by Tawazun Council for Defence Enablement. The revised 2019 Tawazun Economic Programme switched from an earlier offset policy focus on compliance and transactional investment obligations to original equipment manufacturer (OEM) partnerships, designed to promote strategic dual-use 4IR industrial and technological security architectures. A policy that has become known as dual-use by design.

Sovereign capability and technological depth are to be achieved through investment into designated strategic industries – a policy successfully pursued by post-war Japan and post-independence Singapore.

The 2019 framework’s objectives align with the UAE’s national economic diversification priorities, including the development of localised industries for aerospace, defence manufacturing, advanced technology, cybersecurity and AI, and digital industries, and the promotion of innovation and technology transfer through incentivisation of projects that infuse intellectual property, advanced know-how and R&D capabilities into the local economy.

Smart governance and leadership lie at the heart of this virtuous cycle. Strategic foresight in the UAE is articulated through planning ‘visions’, which are then implemented by centralised direction and decentralised execution. These visions translate into coordinated sector-specific roadmaps with measurable milestones such as UAE Vision 2021 – promoting prosperity through the notion of a knowledge economy; ‘We the UAE 2031’ – building the UAE as a global economic hub and influential international partner, through expansion of technological innovation, economic diversification, global influence and defence cooperation; and UAE Centennial 2071, which celebrates 100 years of development since the UAE’s founding by aiming to become one of the best countries globally across education, economy and government. A common theme of these visions is to diversify the economy away from dependence on hydrocarbons. To supplement this process of industrial deepening, Tawazun’s foresight programmes emphasise aligning civilian industry and military needs into one ecosystem.

The UAE’s model works because it recognises that human capital, just as much as physical capital, is a key element in the country’s resilience infrastructure. The aim is to exploit the short-term expediency of expatriate expertise to accelerate growth, while at the same time promoting local talent pipelines to build sovereignty and resilience over time. This talent-layering strategy seeks to both train local Emirati graduates and forge partnerships with OEMs to provide in-country apprenticeships at their factories.

Many of the UAE’s best universities, such as Khalifa University, Abu Dhabi, are closely aligned with national civil-military priorities, producing STEM graduates, including AI and cyber specialists.

The result of all these efforts is that in partnership with foreign OEMs, the UAE is actively transitioning into a global defence manufacturing and export hub. It is at once ensuring sovereign defence capabilities and expanding and diversifying its economy. For example, Raytheon, a division of US defence contractor RTX, now operates an assembly plant for its Coyote counter-unmanned aerial system interceptor at Tawazun Industrial Park (TIP) in Abu Dhabi. TIP is an industrial zone set up specifically to incentivise investment in defence manufacturing.

National firms such as Mubadala Investment Company and EDGE Group are some of the most important civil-military policy vehicles in this regard, working with international partners to build end-to-end value chains that incorporate through-life capabilities in design, production and maintenance. EDGE, in particular, is considered a local champion that supports military readiness and export-oriented economic growth, turning defence spending into a driver of GDP.

Among EDGE’s many partnerships, it has established joint ventures with Italy’s Leonardo to co-develop advanced systems across air, land as well as sea domains, and France’s Thales in the local production of radar and electronic warfare capabilities.

EDGE is already recognised as one of the world’s top defence companies, with revenues in 2025 amounting to over $5 billion and with a global footprint in more than 100 countries.

The UAE’s civil-military paradigm offers a way forward for other nations. Firstly, it holds relevance for similar oil-rich states, also able to use their energy resources to fund profound industrial transformation.

Secondly, the UAE’s policy framework is relevant to African nations possessing rich repositories of critical minerals. Africa currently produces about three quarters of the world’s platinum, cobalt and diamonds, 44% of chromium and 65% of manganese. These critical minerals are attracting the attention of major powers intent on transitioning to green energy and next-generation weapons systems. African states recognise that the present neo-colonial exploitation of these resources must cease and be replaced by an ‘Africanisation’ model promoting local high-value, high-skill activities as the motive force for economic take-off.

Finally, the UAE’s civil-military model ironically reinforces the operational template belatedly employed by Western industrialised nations seeking non-dependent defence industrialisation combined with economic development. The mechanism for this process has been a series of Defence Industrial Strategies (DIS): in January 2024, the US introduced its first DIS; it was followed the next month by Australia; then, in March 2024, the EU published its DIS; and the UK followed suit in September 2025. Canada’s DIS is imminent, scheduled for launch in 2026. Each of these strategies has a different geographical context, but the overarching theme is constant, namely strategic autonomy.

The enabling initiatives for securing strategic autonomy embrace the common goals of supply chain resilience, promotion of STEM skills, defence procurement reform to ensure faster, cheaper and better access to advanced weapons systems and platforms, and, finally, a sharper focus on the economy, especially civil-military integration, to exploit opportunities for cultivating dual-use technologies, such as AI, cyber, bioengineering and advanced big data analytics.

The global security environment is currently experiencing convulsive change, and dependency on overseas arms supply is increasingly viewed as dangerous. The dramatic crumbling of the international order, along with a growing questioning of alliances and military dependence, is pressuring nations to push for strategic autonomy and national resilience.

The reset towards self-reliance and sovereign capability is an opportunity to sponsor both indigenous defence industrial capacity and economic growth. One of the best examples of this happening can be found in the UAE.

It adopts a whole-of-state approach to ensure that defence is interwoven into the process of economic diversification and technological development. It reflects a ‘military-industrial-civil fusion’ model, which encourages the development of 4IR technologies infusing into both the civilian and military sectors. Indeed, the UAE’s dual-use innovation ecosystems are built intentionally to be porous to facilitate civil-military integration and technology spillovers. It is a model that is now capturing the attention of Western nations.