Order Code IB93113
Issue Brief for Congress
Received through the CRS Web
Saudi Arabia: Current
Issues and U.S. Relations
Updated August 21, 2002
Alfred B. Prados
Foreign Affairs, Defense, and Trade Division
Congressional Research Service ˜ The Library of Congress

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CONTENTS
SUMMARY
MOST RECENT DEVELOPMENTS
BACKGROUND AND ANALYSIS
Current Issues
Reaction to September 11 Terrorist Attacks
Lawsuits and Investments
The July 2002 Briefing
Security in the Gulf Region
Containment Policies toward Iraq
U.S. Troop Presence
Bombings of U.S. Military Facilities
Arab-Israeli Conflict
Crown Prince Abdullah’s Peace Initiative
Arms Transfers to Saudi Arabia
U.S. Arms Sales
Trade Relationships
Problems in Commercial Transactions
Oil Production
Foreign Investment
Human Rights, Democracy, and Other Issues
Background to U.S.-Saudi Relations
Political Development
Saudi Leadership
Royal Succession
Economy and Aid
Economic Conditions
Aid Relationships
Defense and Security
Congressional Interest in Saudi Arabia
Arms Sales
Arab Boycott
Trade Practices

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Saudi Arabia:
Current Issues and U.S. Relations
SUMMARY
Saudi Arabia, a monarchy ruled by the
southern Iraq; however, Saudi Arabia has not
Saudi dynasty, enjoys special importance in
offered the use of its territory for major air
the international community because of its
strikes against Iraq in response to Iraqi
unique association with the Islamic religion
obstruction of U.N. weapons inspections in
and its oil wealth. Since the establishment of
recent years. Bombing attacks against a U.S.
the modern Saudi kingdom in 1932, it has
operated training facility and a U.S. military
benefitted from a stable political system based
apartment in 1995 and 1996, respectively,
on a smooth process of succession to the
have raised some concerns about security of
throne and an increasingly prosperous
U.S. personnel and further security measures
economy dominated by the oil sector.
have been implemented. Saudi Arabia
D
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e
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b
y
convicted and executed four Saudi nationals
King Fahd in March 1992 establishing an
f
o
r
appointive consultative council and provincial
carrying out the 1995 bombing. After
councils and promulgating a basic law
extended investigations, on June 21, 2001, a
providing for certain citizens’ rights could
U.S. federal grand jury indicted 14 members
s
i
g
n
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l

a
of Middle East terrorist organizations for the
gradual trend toward a more open political
1996 bombing. None is believed to be in U.S.
system.
custody. U.S. officials have cited Saudi
support in the aftermath of the September 11,
Since late 1995, King Fahd has suffered
2001 attacks, including intelligence sharing,
increasingly from ill health, and Crown Prince
law enforcement activities, and tracking of
Abdullah has assumed many routine govern-
terrorist financing. Some commentators
mental functions. The upsurge in oil prices
maintain that Saudi domestic and foreign
that began in 1999 has relieved pressure on
policies have created a climate that may have
Saudi budgets but created concern in the U.S.
contributed to terrorist acts by Islamic
Administration and Congress. In March 2000,
radicals. Saudi officials reject this viewpoint
Members of Congress introduced legislation
a
n
d
to reduce or end U.S. assistance or arms sales
maintain that they are working with the
to countries engaged in oil price fixing.
United States to combat terrorism.
The United States and Saudi Arabia have
Other principal issues of bilateral interest
long-standing economic and defense ties. A
include the Saudi position on the Arab-Israeli
series of informal agreements, statements by
conflict, security in the post-war Gulf region,
successive U.S. administrations, and military
arms transfers to Saudi Arabia, Saudi external
deployments have demonstrated a strong U.S.
aid programs, bilateral trade relationships, and
security commitment to Saudi Arabia. Saudi
Saudi policies involving human rights and
Arabia was a key member of the allied coali-
democracy. In early 2002, Crown Prince
tion that expelled Iraqi forces from Kuwait in
Abdullah proposed a peace initiative based on
1991, and over 5,000 U.S. troops remain in
Israeli withdrawal from occupied territories in
the country. Saudi Arabia continues to host
return for normal relations between Arab
U.S. aircraft enforcing the no-fly zone over
states and Israel.
Congressional Research Service ˜ The Library of Congress

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MOST RECENT DEVELOPMENTS
On August 6, 2002, an article in The Washington Post described a briefing given by an
analyst from the Rand Corporation on June 10, 2002, to the Defense Policy Board, a high-
level advisory group that advises the U.S. Defense Department on defense policy. According
to the article and to other media, the briefer asserted among other things that “Saudi Arabia
supports our enemies and attacks our allies” and that “the Saudis are active at every level
of the terror chain, from planners to financiers.” Secretary of Defense Donald Rumsfeld
told reporters on August 6 that the briefing represented the analyst’s own opinion and not
the views of the U.S. government or of the Defense Policy Board. State Department
spokesman Phil Reeker told reporters that these views “do not reflect the views of the
President of the United States or of the U.S. Government.” He added that Secretary of State
Colin Powell made that clear in a telephone call to Saudi Foreign Minister Saud al-Faysal.
According to press reports in mid-August 2002, families of more than 600 victims of
the September 11 attacks have filed a suit in the U.S. District Court of Alexandria, Virginia
against three members of the Saudi royal family, seven Saudi banks, and Saudi eight
charitable organizations. The lawsuit seeks approximately $1 trillion in damages from these
individuals or organizations for allegedly helping finance the Al Qaeda network. Saudi
media and business spokesmen have described the suit as an attempt to extort Saudi money
deposited in the United States and exert political pressures on Saudi Arabia. According to
an article on August 21 in the (London) Financial Times, some sources have alleged that
Saudi investors have withdrawn between $100 billion and $200 billion from their holdings
in the United States in recent months, but other sources have expressed skepticism that a
mass exodus of Saudi funds is under way.
BACKGROUND AND ANALYSIS
Current Issues
Oil and national security concerns have combined to produce a close and cooperative
relationship between the United States and Saudi Arabia for much of the past century. Since
the award of the first Saudi oil concession to a U.S. company in 1933, both states have had
an increasing interest, respectively, in the marketing and acquisition of Saudi petroleum
supplies. As regional threats multiplied in the latter half of the century, mutual concerns
over the stability of Saudi Arabia and other moderate regimes in the Arabian Peninsula
engendered a significant degree of defense cooperation. Saudi Arabia was a key member
of the allied coalition that expelled Iraqi forces from Kuwait in 1991 and continues to host
more than 5,000 U.S. military personnel, most of them from U.S. Air Force units that
enforce the no-fly zone over southern Iraq (Operation Southern Watch). A range of issues,
however, sometimes complicate U.S.-Saudi relations, as discussed below. Also, some
commentators cite additional strains in bilateral relations since the September 11, 2001
attacks, but U.S. and Saudi officials continue to characterize ties between the two countries
as excellent.
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Reaction to September 11 Terrorist Attacks
Top Saudi leaders expressed
condolences to the United States
Saudi Arabia in Brief
after the terrorist attacks of
September 11, 2001, and offered
Population (July 2001): 22,757,092*
assistance in tracking down the
(includes 5,360,526 foreign residents)
Growth rate: 3.27%
perpetrators. Crown Prince
Area: 1,945,000 sq. km. (750,965 sq.mi.)
Abdullah, who is effectively
(almost 3 times that of Texas)
running the country (see below),
Ethnic Groups: (native Saudis only)
told President Bush that “[w]e in the
Arab 90% Afro-Asian 10%
kingdom of Saudi Arabia are fully
Religion: (native Saudis only)
prepared to cooperate with you in
Muslim 100% (Sunni 85-95%; Shi’ite 5-15%)
every way that may help identify
Literacy (1995):
and pursue the perpetrators of this
63% (male 72%, female 50%)
criminal incident.” On September
GDP: $168.8 billion (2000);
25, Saudi Arabia severed relations
$170.5 billion (2001)
with the Taliban leadership in
External Public Debt: $28.9 billion (2000)
Inflation: -1.2%, 1999; -1.0%, 2000; 0%, 2001
Afghanistan. Earlier, in 1994, the
Saudi government had revoked the
*Some estimates are 15-30% lower
citizenship of prime suspect Osama
bin Laden. On November 27,
Sources: IMF; U.S. Dept. of Commerce; CIA World Fact
presidential spokesman Ari
Book
Fleischer mentioned several
examples of Saudi support to the
campaign against terrorism, including Saudi help in extending economic assistance to
Pakistan, humanitarian relief to the people of Afghanistan, and intelligence sharing with the
United States. At a donors’ conference in Tokyo on January 21, 2002, Saudi Arabia pledged
$220 million over a 3-year period to help rebuild Afghanistan after 23 years of war. Many
commentators in the United States have emphasized that 15 of the 19 hijackers were Saudi
nationals, and some maintain that Saudi domestic and foreign policies have created a climate
that may have contributed to terrorist acts by Islamic radicals. Saudi officials reject this
viewpoint and maintain that they are working with the United States to combat terrorism.
Saudi officials were non-committal about their willingness to allow allied use of bases
in Saudi Arabia to launch strikes against targets in Afghanistan. At a press conference on
September 26, Saudi Foreign Minister Prince Faysal told reporters that “Saudi Arabia will
do what is within its capability” to support the coalition against terrorism but did not provide
specifics. On October 3, Secretary of Defense Donald Rumsfeld told reporters that “[w]e
are not going to be making requests of the Saudi Arabian government. We have a long-
standing relationship with them.” Some speculate that Saudi leaders may have allowed the
use of bases for logistical support of allied operations targeting Afghanistan but not as points
of departure for combat missions. (See below regarding Saudi positions on strikes against
Iraq.)
On June 18, 2002, Saudi officials announced that Saudi Arabia had arrested 13
suspected Al Qaeda members on charges of plotting attacks against “vital sites” in the
kingdom. An unnamed “security source” said the 13 belonged to two Al Qaeda cells that
were ordered by Al Qaeda officials to hit targets in Saudi Arabia including U.S. military
facilities. On August 10, the Saudi Foreign Minister revealed that Iran had expelled 16 Al
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Qaeda refugees who had earlier sought political asylum in Iran and transferred them to Saudi
Arabia at the latter’s request. According to the Saudi Foreign Minister, the 16 are being
interrogated and, if charged with crimes, will be brought to trial.
Various observers have periodically expressed the view that Saudi Arabia could do
more to curtail terrorist financing. President Bush’s Executive Order 13224, which has
blocked assets of over 200 individuals or organizations with ties to exiled terrorist leader
Osama bin Laden or other terrorist groups, reportedly includes a Saudi businessman and a
Saudi-based charitable organization. On December 11, 2001, the Saudi Embassy in
Washington released a progress report enumerating steps taken by Saudi Arabia to combat
money laundering and terrorist financing. Among these steps is a requirement for all Saudi
banks to have anti-money laundering units to work with the Saudi Arabian Monetary Agency
(SAMA) and with law enforcement agencies. On February 5, 2002, a Saudi official was
quoted as saying that every charity in Saudi Arabia (reportedly 230) will be monitored. On
the following day, news agencies reported that SAMA is monitoring 150 bank accounts
associated with prominent Saudi businessmen to prevent the possible diversion of funds in
these accounts to terrorist organizations.
During a visit to Saudi Arabia, U.S. Secretary of the Treasury Paul O’Neill told
reporters on March 6 that “the government of Saudi Arabia has been very good in its
cooperation with us” in seeking to uncover money laundering activities. On March 12,
Secretary O’Neill announced a joint operation with Saudi authorities to cut off funding to
several overseas subsidiaries of a large Muslim foundation known as al-Haramain. The
subsidiaries, though not the parent organization itself, have allegedly been involved in
terrorist activities in Bosnia, Somalia, and other locations. The parent organization
reportedly has ties to senior levels of the Saudi government. U.S. State Department
spokesman Philip Reeker told reporters on August 6, 2002, that the United States and Saudi
Arabia have worked together on financial aspects of the war against terrorism and mentioned
that there are mechanisms (presumably classified) through which the flow of funds to
terrorists can be monitored. In an interview with ABC-TV on August 11, the Saudi Foreign
Minister mentioned a joint U.S.-Saudi committee that deals with freezing assets of anyone
who finances terror.
Lawsuits and Investments. According to press reports in mid-August 2002,
families of more than 600 victims of the September 11 attacks have filed a suit in the U.S.
District Court of Alexandria, Virginia against three members of the Saudi royal family,
seven banks, and eight charitable organizations. The lawsuit, which also names Osama bin
Laden, members of his family, and the government of the Sudan, seeks approximately $1
trillion in damages from these individuals or organizations for allegedly helping finance the
Al Qaeda network. According to excerpts reported in the press, the lawsuit states that “the
financial resources and support network of these defendants – charities, banks and individual
financiers – are what allowed the attacks of September 11, 2001 to occur.” Saudi media and
business spokesmen have described the suit as an attempt to extort Saudi money deposited
in the United States and exert political pressures on Saudi Arabia; some have called for
withdrawing Saudi investments in the United States, estimated by one media source at $750
billion and another at between $400 and $600 billion. A London Financial Times article on
August 21, 2002, quoted estimates that Saudi investors have withdrawn between $100 billion
and $200 billion from the United States in recent months, but other sources quoted in the
article expressed skepticism that a mass exodus of Saudi money is under way.
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The July 2002 Briefing. On August 6, 2002, an article in The Washington Post
described a briefing given by an analyst from the Rand Corporation on June 10, 2002, to the
Defense Policy Board, a high-level advisory group that advises the U.S. Defense Department
on defense policy. According to the article and to other media, the briefer asserted among
other things that “Saudi Arabia supports our enemies and attacks our allies” and that “the
Saudis are active at every level of the terror chain, from planners to financiers.” Secretary
of Defense Donald Rumsfeld told reporters on August 6 that the briefing represented the
analyst’s own opinion and went on to say: “It did not represent the views of the government,
it didn’t represent the views of the Defense Policy Board.” State Department spokesman
Phil Reeker told reporters that these views “do not reflect the views of the President of the
United States or of the U.S. Government.” He added that Secretary of State Powell made
that clear in a telephone call to Saudi Foreign Minister Saud al-Faysal. Saudi Crown Prince
Abdullah’s foreign policy adviser described views expressed in the briefing as “pure
fiction.” According to media reports, however, these views have gained some currency
among various commentators with ties to Administration policy makers.
Security in the Gulf Region
Containment Policies toward Iraq. As noted above, Saudi Arabia hosts U.S. Air
Force units that conduct overflights to enforce a no-fly zone over southern Iraq. Although
they do not usually object to small scale U.S. responses to Iraqi aircraft or air defense units
challenging allied aircraft conducting these overflights, Saudi authorities are opposed to
large-scale allied military action against Iraqi targets. On several occasions, Saudi Minister
of Defense Prince Sultan has said his country would not permit allied aircraft to launch
preemptive or major retaliatory campaigns against Iraq from bases in Saudi Arabia. In the
aftermath of the September 2001 terrorist attacks, Saudi authorities have expressed concern
over any expansion of the U.S. campaign against terrorism to Iraq or Iran. In comments
published on August 7, 2002, Saudi Foreign Minister Prince Saud bin Faysal reiterated this
position, and said the Saudi government does not want allied forces “to use Saudi grounds”
for any attack on Iraq.
U.S. Troop Presence. Some commentators suggest that the U.S. troop presence,
which is unpopular among some Islamic fundamentalists both in the kingdom and elsewhere
in the region, could undermine the stability of the Saudi regime. Others believe the U.S.
presence is crucial to U.S. efforts to maintain security in the Gulf region. Both for reasons
of security and host country sensitivities, U.S. military personnel are housed in remote
compounds away from major population centers or Islamic holy places. Saudi Defense
Minister Prince Sultan stated on April 10, 2000, that U.S. troops in Saudi Arabia “are within
the frame of United Nations assignments and directions to continue the surveillance of
southern Iraq, and also the border of Kuwait and Saudi Arabia, as well as the other GCC
[Gulf Cooperation Council] countries.”
A Washington Post article on January 18, 2002, described Saudi leaders as increasingly
uncomfortable with the U.S. military presence in their country and indicated that senior
Saudis would like to devise “other forms of less conspicuous military cooperation” once the
Afghan campaign is over. Earlier, on January 15, a Member of the U.S. Senate had
reportedly expressed “unease about our presence in Saudi Arabia.” Officials of the Bush
Administration and Saudi officials have denied that there has been any change in long-
standing U.S.-Saudi defense relationships. In an interview carried by media on February 26,
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when asked if “the U.S. military has worn out its welcome in Saudi Arabia”, Prince
Abdullah replied that “[w]e don’t think about raising this issue at all. If and when the time
comes, it will be discussed by both governments.” According to a senior Administration
official, the subject of bases did not arise during the visit of Crown Prince Abdullah to
President Bush on April 25, 2002.
A subsequent Washington Post article, on April 6, 2002, reported that the U.S. Defense
Department has prepared plans to move a sophisticated military command center known as
the “Coalition Air Operations Center” (CAOC) from Saudi Arabia to the neighboring state
of Qatar, in an effort to reduce U.S. dependence on Saudi Arabia in supporting military
operations in the region. Secretary of Defense Donald Rumsfeld did not confirm this report,
telling reporters that “we’re constantly moving people from one place to another place.”
Earlier, on March 26, the unified theater commander General Tommy Franks told reporters
that “I have no plans to move the CAOC from its current location.” But he added that this
would not preclude plans “to replicate it some place.”
Bombings of U.S. Military Facilities. Two attacks on U.S. military facilities in
Saudi Arabia in the mid-1990s created concern in the United States over the security of U.S.
military personnel stationed in Saudi Arabia and other U.S. service members stationed
elsewhere in the Gulf. The first, which occurred on November 13, 1995, at the headquarters
of a U.S. training program for the Saudi National Guard in the capital of Riyadh, killed seven
persons (including five U.S. citizens). Several months later, Saudi authorities charged four
Saudis with the crime. The four, who confessed to being influenced by Islamic
fundamentalist exiles, were convicted and executed.
The second and more lethal explosion, which occurred at Khobar Towers (a housing
facility for U.S. Air Force personnel near Dhahran Air Base) in June 1996, killed 19 U.S. Air
Force personnel, wounded many others, and prompted the relocation of most U.S. military
personnel to more remote sites in Saudi Arabia to improve security. Press reports allegedly
based on Saudi investigations and reported statements by other suspects have suggested
involvement by Iran, but Saudi officials have called these reports inaccurate. Earlier reports
had suggested involvement by exiled Saudi terrorist Osama bin Ladin, who has praised the
bombings in Saudi Arabia but has not claimed responsibility for them. On May 22, 1998,
Saudi Minister of Interior Prince Nayif told reporters from Kuwait that the Riyadh and
Khobar bombings “were carried out by Saudis with the support of others” (whom he did not
identify). The Minister further stated in November that bin Ladin was not responsible for
either the Riyadh or the Khobar bombings but acknowledged that individuals influenced by
bin Ladin might have conducted the attacks.
In September 1999, media cited purported U.S. intelligence information that three Saudi
men linked to the bombing had taken refuge in Iran. On October 2, 1999, Iran’s foreign
minister rebuffed an alleged request from President Clinton to Iranian President Khatemi for
Iranian assistance in resolving the case. Asked on March 12, 2000, if any suspects in the
Khobar case were currently in Iran, Prince Nayif told reporters that “we cannot hold anyone
responsible until the facts become clear to us.” Later, on October 30, 2000, he commented
that “[t]he main suspects are not in Saudi Arabia” and added that “[w]e are making efforts
for their return to the kingdom.” There have been numerous reports, denied by both the U.S.
and Saudi governments, that both governments fear that a finding of Iranian involvement
could complicate relations with Iran or force U.S. retaliation against Iran.
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On June 21, 2001, U.S. Attorney General John Ashcroft announced that a federal grand
jury had indicted 14 individuals in connection with the Khobar Towers bombing. According
to the Justice Department, 13 of those indicted belong to the pro-Iranian Saudi Hizballah
organization and the 14th is linked to the Lebanese Hizballah organization. (Saudi Hizballah
appears to be a chapter of the parent Hizballah organization in Lebanon.) According to the
press, none of the persons indicted is in U.S. custody at this time; 11 of them are in Saudi
jails. Although no Iranian is named or charged in the indictment, Ashcroft said “[t]he
indictment explains that elements of the Iranian government inspired, supported and
supervised members of Saudi Hizbollah [variant spelling]. In particular, the indictment
alleges that the charged defendants reported their surveillance activities to Iranian officials
and were supported and directed in those activities by Iranian officials.” Ashcroft said the
investigation is continuing and additional charges will be brought, as appropriate.
During the investigation, U.S. law enforcement officials criticized Saudi counterparts
for not providing U.S. investigators with access to suspects in the Khobar bombing.
According to a May 14, 2001 article in The New Yorker and other media reports, starting in
late 1998, Saudi officials began allowing FBI agents to watch behind a one-way mirror as
Saudi interrogators posed questions provided by the FBI to suspects and witnesses. In a
phone call on June 21, 2001–the day the indictments were announced–President Bush
thanked Saudi Crown Prince Abdullah for Saudi cooperation in the investigation. The FBI
Director also expressed his appreciation, along with his hopes that the suspects would be
brought to justice in the United States. In an interview published on June 23, however,
Saudi Interior Minister Prince Nayif appeared to rule out extradition of the suspects to the
United States, stating that “[t]he trials must take place before Saudi judicial authorities....”
He added that “[n]o other entity has the right to try or investigate any crimes occurring on
Saudi lands.”
On June 1, 2002, Saudi Deputy Minister of the Interior Prince Ahmad said an
unspecified number of people previously arrested by Saudi Arabia in connection with the
Khobar bombing had been sentenced by an Islamic court. In a follow-up announcement on
June 13, the Prince said those convicted “do not include any non-Saudi nationals” and added
that the verdicts would be reviewed by higher courts and announced “at the appropriate
time.”
Arab-Israeli Conflict
Saudi Arabia supports Palestinian aspirations and strongly endorses Muslim claims in
the old city of Jerusalem. It has supported Israeli-Palestinian peace agreements, and joined
with neighboring Gulf states in 1994 in terminating enforcement of the so-called secondary
and tertiary (indirect) boycotts of Israel while retaining the primary (direct) boycott. Saudi
leaders have been increasingly critical of Israel since the Palestinian uprising began in
September 2000. According to a New York Times article of May 17, 2001, Crown Prince
Abdullah declined an invitation to visit the United States in June 2001, to indicate
displeasure over what Saudis regard as insufficient U.S. efforts to restrain Israeli military
actions against Palestinians. However, the Crown Prince did accept a subsequent invitation
to visit President Bush in Texas in April 2002 (see below).
Saudi Arabia, like other Arab states, recognizes the Palestine Liberation Organization
(PLO) as the legitimate representative of the Palestinian people and provides some financial
support to Palestinian institutions. At an Arab League meeting on October 22, 2000, Crown
Prince Abdullah took the lead in creating a $1 billion fund: $800 million to help preserve
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the “Arab and Islamic identity of Jerusalem” and $200 million to help families of
Palestinians killed in the current unrest. Saudi Arabia reportedly pledged a total of $250
million to these two funds, and provided an additional $30 million to the Palestinian
Authority (PA) on November 5 as a separate donation. At an informal international donors’
conference at Stockholm on April 11, 2001, Saudi Arabia pledged $225 million in direct
monetary support to the PA over a 6-month period to cover emergency expenses. PLO/PA
Chairman Yasir Arafat received a $45 million grant during a visit to Saudi Arabia on July
23, 2001, but it is not clear whether this represented part of the $225 million grant pledged
by Saudi Arabia in April.
There have been unsubstantiated reports of Saudi assistance to the PLO’s rival
organization, the fundamentalist Hamas, particularly after the Saudi-PLO rift that occurred
after the PLO supported Iraq in 1990. In its report entitled Patters of Global Terrorism,
2001, the State Department noted that Hamas receives funding from “private benefactors in
Saudi Arabia” and some other countries but does not estimate amounts involved. Saudi
Arabia has provided aid (variously estimated at $33 million and $59 million) to families of
Palestinians killed or injured in the 17-month-old Palestinian uprising; in addition, Saudis
raised additional funds (over $100 million according to one report) for this purpose at a
telethon sponsored by King Fahd on April 11, 2002. Saudi officials told U.S. counterparts
in late April that proceeds of the telethon are funneled through non-governmental
organizations to provide some humanitarian support to needy Palestinian families; the Saudis
drew a distinction between their fund raising activities and those of Iraq, which pays families
who will sacrifice their children as suicide bombers. In early May, Israel officials, citing
captured Palestinian documents, said the Saudi Government has given money to 13 charities,
seven of which provide support to Hamas. The Saudi Ambassador denied this report.
Crown Prince Abdullah’s Peace Initiative. On February 17, 2002, New York
Times columnist Thomas Friedman reported an off-the-record conversation with Crown
Prince Abdullah. According to Friedman, the Crown Prince said he had prepared a draft
speech calling for full Israeli withdrawal from Israeli occupied territories in return for full
normalization of relations between Arab states and Israel. The Crown Prince added that he
had planned to give the speech before an Arab summit conference at the end of March but
had delayed doing so after what he regarded as Israeli Prime Minister Ariel Sharon’s
resorting to increased oppression in the Palestinian territories. However, Prince Abdullah’s
office did authorize Friedman to put the prince’s comments on the record. Abdullah did not
provide details of his proposal, and some commentators believe the prince’s comments
represent nothing new over and above long-standing Arab land-for-peace proposals. Other
commentators believe that such comments from an Arab leader of Abdullah’s stature carry
special weight and could portend a breakthrough in Arab-Israeli peace negotiations.
Crown Prince Abdullah’s proposal was the centerpiece of the Arab League summit
conference held on March 27-28, 2002, and an expanded version of his proposal was
included in a resolution adopted at the conference. The proposal, as agreed upon by the
attendees, called among other things for Israeli withdrawal from territories it had occupied
since 1967, a “just solution to the problem of Palestinian refugees,” and establishment of
normal relations between Arab states and Israel. The Saudi-initiated peace proposal was
also a major topic of discussion during Crown Prince Abdullah’s visit to President Bush at
the latter’s ranch in Texas on April 25. A senior Administration official told reporters that
“[t]he President congratulated him [Abdullah} again on his statesmanship in putting the
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[initiative] forward.” According to White House spokesman Ari Fleischer, there are areas
of disagreement between U.S. and Saudi peace plans but significant areas of overlap as well.
Saudi officials found “positive factors” in President Bush’s speech of June 24 but
expressed concern over his statements conditioning a Palestinian state on the installation of
a new Palestinian leadership. A statement by the Saudi cabinet on July 1 alluded to “the
positive elements of the Bush initiative,” but on the same day Crown Prince Abdullah was
quoted as telling the visiting Spanish Defense Minister that the Palestinian people “alone
have the right to choose their leadership.”
Arms Transfers to Saudi Arabia
U.S. Arms Sales. The United States is currently Saudi Arabia’s leading arms
supplier. Total value of arms agreements with Saudi Arabia from 1950 through March 31,
1997, was $93.8 billion, while arms agreements with Saudi Arabia from 1991 through 1998
amounted to $22.8 billion. The upsurge in Saudi arms purchases from the United States after
1990 was due in large measure to the Persian Gulf crisis and its aftermath. The largest
recent sale was a $9 billion contract for 72 F-15S advanced fighter aircraft, signed in May
1993. As Table 1 shows, approximately 21% of the value of U.S.-Saudi arms contracts from
1950 to 1997 were for lethal equipment (i.e., weapons, ammunition, and combat vehicles,
aircraft, and ships); the largest portion (32%) went for support services (repair,
rehabilitation, supply operations, and training). Another major component of the Saudi
program has been construction of military bases and facilities, accounting for 19%, although
most military infrastructure projects were completed by 1990.
A downward trend has marked Saudi arms procurement since the mid-1990s as Saudi
Arabia completed many of its post-Gulf War purchases and the country faced straitened
finances. Since the late 1990s there have been occasional reports of Saudi interest in
renovating further their model combat aircraft fleet, but no significant deals have emerged.
On May 7, 2001, the Saudi Assistant Minister of Defense described his country’s priority
as sustaining existing weapon systems rather than large-scale procurement of new weaponry,
despite mounting oil revenues. He ruled out additional F-15 fighters aircraft to replace aging
F-5s this year as well as tank modernization. Reports in April 2001, however, indicated
continued Saudi interest in more and newer F-15s or possibly F-16 or F-22 fighter aircraft
(both made by Lockheed Martin Corporation in Bethesda, Maryland.)
On September 8, 2000, the U.S. Defense Department announced that Saudi Arabia has
asked to buy three arms packages from the United States: (1) $416 million in light armored
vehicles, anti-tank missiles, and advanced communications equipment for the paramilitary
Saudi National Guard; (2) $690 million in contractor training and maintenance support for
Saudi Arabia’s fleet of F-15 fighter aircraft; and (3) $1.6 billion in flight simulators, repair
parts, and other technical services for the F-15 aircraft. The prime contractors for the first
package would be the Diesel Division of General Motors of London, Ontario, and Raytheon
Corporation of Tuscon, Arizona. The prime contractor for the second package would be al-
Salam Aircraft Company of Saudi Arabia, which is 50% owned by Boeing Co. The prime
contractor for the third package has not yet been determined.
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Table 1. U.S. Arms Transfers to Saudi Arabia, 1950-1997
Orders
Deliveries
Category
$ in
% of Total
% of Total
$ in Billions
Billions
Orders
Deliveries
Weapons & Ammunition
19.893
21.2
9.092
15.6
Support Equipment
16.614
17.7
9.815
16.8
Spare Parts & Modifications
9.778
10.4
5.259
9.0
Supply, Repair, Training
29.615
31.6
17.804
30.6
Construction
17.924
19.1
16.197
27.8
TOTALS
93.824
–
58.167
–
Note: All figures are current through March 31, 1997.
Successive U.S. Administrations have entered into military sales agreements with Saudi
Arabia because of its prestige in the Arab world, its importance as a major source of oil, and
its vulnerability to threats from neighboring states supported in the past by the Soviet Union.
Heightened threats from Iran in the late 1980s and subsequently from Iraq provided rationale
for an expansion of the arms supply relationship, and some observers believe further sales
are needed to redress a continuing gap between Saudi weapons inventories and those of
potential adversaries. Also, the Saudi arms market has helped maintain the U.S. industrial
base and create jobs.
Some critics doubt that Saudi forces can absorb large quantities of advanced military
hardware and voice concerns that such equipment could fall into the wrong hands in the
event of external invasion or a radical change in the Saudi regime. Many are concerned that
arms being sold to Saudi Arabia might be used one day against Israel. Others doubt that
Israel is seriously threatened by Saudi Arabia, but oppose sales to Arab countries technically
at war with Israel and fear that enhancement of Saudi air and missile capabilities could
increase the costs to Israel of a future conflict. Another concern is that continuing arms sales
to Saudi Arabia undermine efforts to restrain the flow of advanced weaponry to an already
heavily armed Middle East.
Trade Relationships
Saudi Arabia was the largest U.S. trading partner in the Middle East in 2000. For that
year, Saudi exports to the United States were estimated at $14.3 billion and imports from the
United States at $5.9 billion. Comparable figures for Israel, the second largest U.S. trading
partner in the Middle East, were $12.9 billion in exports and $6.2 billion in imports. To a
considerable extent, this high volume of trade is a result of U.S. oil imports from Saudi
Arabia and U.S. arms exports to that country. The Saudis buy significant amounts of U.S.
commercial equipment as well. Also, a Washington Post article of February 11, 2002,
estimates that Saudi nationals have invested between $500 and $700 billion in the U.S.
economy.
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Saudi Arabia has applied to join the 128-member World Trade Organization (WTO)
as a developing country, an arrangement that would give it a special transition period to
bring its commercial procedures in line with WTO rules. The U.S. State Department notes
that accession will require the Saudi government to initiate substantial reforms, including
tariff reduction, opening up financial services (insurance and banking), allowing competition
in telecommunications and other services, and better protection of intellectual property
rights. In recognition of its progress in protection of intellectual property rights, Saudi
Arabia was removed from the U.S. Trade Representative’s Priority Watch List in 1996, but
remains on the basic Watch List pending further progress. The U.S. Trade Representative
reportedly has also cited Saudi observance of the secondary boycott against Israel as an
obstacle to admission to the WTO. In March 2001, WTO officials reportedly expressed
disappointment over a recent list issued by the Saudi government of activities off limits to
foreign investment (see below) and predicted that these restrictions could delay Saudi
accession to the WTO. During Crown Prince Abdullah’s April 2002 visit, however,
President Bush expressed support for Saudi accession and said the United States is making
technical assistance available to Saudi Arabia to support the Saudi application.
Problems in Commercial Transactions. Complaints have arisen within the U.S.
business community over commercial disputes that have resulted in hardships for U.S.
companies doing business in Saudi Arabia and for their employees. These disputes center
on allegations by U.S. firms that Saudi clients have not paid for services rendered or have
sought to expand terms of a contract without further reimbursement, and in some cases have
taken reprisals against U.S. employees of the firms involved. (For further information, see
CRS Report 95-666, Saudi Arabia: Commercial Disputes With U.S. Firms.).
Oil Production. With the world’s largest proven oil reserves (estimated at 261.7
billion barrels in January 2001), Saudi Arabia produced an average of 9.145 million barrels
per day (bpd) of crude oil during 2000. Approximately 14% of U.S. oil imports and 8.46%
of total U.S. oil consumption came from Saudi Arabia during 2001. Formerly the largest
foreign supplier of oil to the United States, Saudi Arabia has been exceeded in this role by
Venezuela and/or Canada during recent years (see Table 2). In recent years, Saudi Arabia
has alternately supported cuts and increases in production as oil prices on the international
market have fluctuated. Under a “gentlemen’s agreement” reached in June 2000, members
of the Organization of Petroleum Exporting Countries (OPEC) established a mechanism to
adjust the supply of oil by 500,000 bpd if the 20-day average price of oil moved outside a
$22 to $28 price band. Members disagree, however, as to whether this mechanism is
automatic or requires separate action by OPEC to implement, and Saudi Arabia has spoken
of a target price of $25 rather than a price band. Congress has enacted legislation to
discourage price fixing by oil producing countries (see below). With regard to Iraq’s call
in April 2002 for a halt in oil production to protest Israeli actions toward Palestinians, a
senior Administration official told reporters after the visit of Saudi Crown Prince Abdullah
that Saudi officials assured their U.S. hosts that oil would not be used as a weapon. In May,
the Saudi Oil Minister added that “Saudi Arabia is keen to maintain stability in the
international oil market ...”
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Table 2. Oil Consumption and Imports
(in millions of barrels per day)
Category
1998
1999
2000
2001
Total U.S. Consumption
18.917
19.519
19.701
19.649
Total U.S. Imports
10.708
10.852
11.459
11.871
Imports from Saudi Arabia
1.491
1.478
1.572
1.662
Imports from Venezuela
1.719
1.493
1.546
1.553
Imports from Canada
1.598
1.539
1.807
1.828
Source: DOE.
Foreign Investment. Saudi leaders have shown increasing interest in attracting
foreign investment in their energy sector, although projects in upstream oil apparently
remain off limits. On April 10, 2000, King Fahd approved a new foreign investment law
which allows international investors to have full ownership of projects and related property
in Saudi Arabia, reduces taxes from 45% to 30% on corporate profits, and restructures (but
apparently does not abolish) requirements for foreign businessmen to have a Saudi sponsor.
On February 11, 2001, the Saudi Supreme Economic Council issued a so-called “negative
list” of those investment activities that remain off limits to foreign investment. In general,
the list covers oil exploration and production, some manufacturing activities, radio and
telecommunications, transport, electricity transmission and distribution, and a range of
services including tourism, publishing, real estate brokerage, and insurance. According to
news reports in March 2001, international trade officials expressed disappointment over the
length and scope of the list. The list will be reviewed annually, however, and some
observers have speculated that it will be shortened as the country adjusts to an expansion in
foreign investment. In a later development, according to a news report in April 2002, Saudi
officials are considering a draft law that would tax the earnings of expatriate employees in
Saudi Arabia for the first time since the 1970s, in addition to the annual corporate taxes
already levied on foreign firms operating in Saudi Arabia.
On June 3, 2001, Saudi Arabia signed preliminary agreements worth approximately $25
billion with eight international oil companies to develop three natural gas fields, together
with related power plants, transmission pipelines, and water desalinization projects. Five
of these companies are U.S.-based, including Exxon Mobil Corporation, Conoco, Phillips
Petroleum Company, Occidental Petroleum Corporation, and Marathon. Exxon Mobil is the
lead manager for two of the three gas field projects. Conclusion of final agreements,
originally set for mid-December, has been delayed, as Saudi and company negotiators
continue trying to resolve several issues including taxes, rate of return on investments, and
size of the gas reserves being offered. On May 17, 2002, according to a press report, “a
source close to the talks” predicted that the Saudis would re-open the projects for new bids
if final agreements are not reached with the above-mentioned companies “within the next
couple of months or so.” The source emphasized, however, that the Saudi Government
wants the current negotiations to succeed and denied that political considerations (such as
Israeli-Palestinian fighting) play any role in Saudi decisions on this matter.
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Human Rights, Democracy, and Other Issues
Of particular concern to Westerners are pervasive restrictions on women’s activities and
an injunction against the practice of other religions throughout the Kingdom. This injunction
has been applied not only against non-Islamic faiths but also at times against the Shi’ite
Muslim community in Saudi Arabia, estimated at 500,000 or more persons mainly in the
Eastern Province. Since 1990, the Saudi government has moved quietly to ease some
restrictions on Shi’ites. Also, according to the State Department, high-level Saudi officials
have said that Saudi policy allows for private non-Muslim worship, for example, in private
homes or secluded compounds. On April 6, 2000, responding to criticisms by the London-
based Amnesty International, a Saudi Under Secretary in the Foreign Ministry maintained
that “non-Muslims enjoy full freedom to engage in their religious observances in private.”
Earlier, in April 1999, Crown Prince Abdullah told a local audience: “Taking into account
the teachings of Islam, we will do our best to enable Saudi women to continue to contribute.”
Political reforms promulgated by King Fahd appear to represent a limited move toward
democracy and protection of individual freedoms. The “main law” announced by the King
on March 1, 1992, bans arbitrary arrest, harassment, or entry of individual homes without
legal authority and specifies privacy in telephone calls and mail. On August 20, 1993, the
King appointed a 60-member consultative council (increased to 90 in 1997 and to 120 in
2001), with limited powers to question cabinet members and propose laws. On the other
hand, King Fahd has said that free elections are not suitable for his country; he stated on
March 30, 1992 that elections “do not fall within the sphere of the Muslim religion, which
believes in the al-shura (consultative) system and openness between ruler and his subjects
and which makes whoever is in charge fully answerable to his people.”
Background to U.S.-Saudi Relations
Political Development
Saudi Leadership. As the birthplace of the Islamic religion in 622 A.D. and as the
home of Islam’s two holiest shrines, the Arabian Peninsula has always occupied a position
of special prestige within the Middle East. With the establishment of Arab empires based
in Damascus and Baghdad, the peninsula gradually lost its political importance and sank into
disunity. In the 16th century, much of the Arabian Peninsula came under the nominal rule
of the Ottoman Empire; however, tribal leaders effectively controlled most of the region.
During this period, an alliance developed between an influential eastern tribe, the House of
Saud, and the leaders of a puritanical and reformist Islamic group known as the Wahhabi
movement. During the first quarter of the 20th century, a chieftain of the Saud family, Abd
al-Aziz ibn Abd al-Rahman (later known as Ibn Saud) overcame numerous rivals with the
support of his Wahhabi allies and succeeded in unifying most of the Arabian Peninsula under
his rule. Four sons have succeeded him.
Royal Succession. King Fahd, the current ruler and a dynamic leader for many
years, is approximately 80 years old and suffers from medical problems including diabetes
and arthritis. In early 1996, King Fahd temporarily turned over affairs of state to his half-
brother, Crown Prince Abdullah, for a six-week period while the King recuperated from a
stroke. More recently, amid conflicting reports about the King’s condition, Crown Prince
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Abdullah has increasingly carried out many governmental functions since 1996, together
with other senior princes of the royal family. Another key figure is Defense Minister Prince
Sultan, a full brother of King Fahd, who is generally considered next in line of succession
after Prince Abdullah. (King Fahd, Prince Abdullah, and Prince Sultan also hold the
positions of Prime Minister, First Deputy Prime Minister, and Second Deputy Prime
Minister, respectively.) A press report in August 2002 indicates that King Fahd’s health has
been deteriorating.
Most commentators believe the royal family would back Crown Prince Abdullah in a
smooth transfer of power if King Fahd should pass from the scene. Various sources describe
Prince Abdullah as more traditional and less western in outlook than King Fahd and more
oriented toward the Arab world. On balance, the Crown Prince seems likely to maintain
Saudi Arabia’s long-standing strategic and economic ties with the United States. U.S.
officials commented that President Bush and Crown Prince Abdullah established a very good
personal rapport during the latter’s visit in April 2002. Some speculate, however, that
succession could become more intricate after Abdullah (who is only two years younger than
Fahd but believed to be in better health) and fear that future intra-family rivalries could
weaken the Saud dynasty over the long term. Possible future candidates include some 25
brothers and half-brothers of King Fahd and a number of sons and nephews. In June 2000,
Saudi Arabia formed a council consisting of 18 senior princes representing leading branches
of the royal family, chaired by Crown Prince Abdullah with Prince Sultan as deputy
chairman. An observer speculated that its role seems to be to organize family matters,
provide a family forum, and deal with other family issues.
Economy and Aid
Economic Conditions. Oil is the dominant factor in the Saudi economy, accounting
for 35-40% of GDP, 75% of budget receipts, and 90-95% of export earnings as of April
2000; even more of the GDP is derived indirectly from the oil industry. Despite immense
oil revenue, a combination of fluctuating oil prices, domestic welfare spending, and military
spending have caused periodic budget deficits (see Table 3). For example, the 1990-1991
Gulf war cost Saudi Arabia approximately $55 billion (including $16.9 billion contributed
to the United States to help defray expenses). Although the government was able to retire
its external debt in May 1995, it had to borrow $4.3 billion again from external sources in
December 1997 to finance purchase of aircraft. Since 1994 the government has instituted
various austerity measures to deal with shrinking revenue.
Aid Relationships. As Saudi oil income expanded, U.S. economic aid ended in
1959. Small amounts of aid continued through 1975, limited to a small international military
education and training (IMET) program after 1968. Total U.S. aid to Saudi Arabia from
1946 through its termination in 1975 amounted to $328.4 million, of which $295.8 million
was military and $32.6 million was economic assistance. Approximately 20% of total aid
was in the form of grants and 80% in loans, all of which have been repaid. A small IMET
program of $25,000 per year to help defray some expenses of sending Saudi officers to U.S.
military service schools was resumed in FY2002, and the same amount was requested by the
Administration for Saudi Arabia in FY2003. Saudi officials also cite their country’s role as
a donor of aid to less affluent countries; according to a Saudi diplomat, the Saudi
government extended $820.3 million worth of aid to developing countries in 2001.
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Table 3. Saudi Budget Figures
(In billions of U.S. dollars, at exchange rate of $1.00=S.R. 3.75)
1999
2000
2001
2002
Category
Budget
Actual
Budget
Actual
Budget Est.
Budget
Expenditure
44.0
48.3
49.3
54.1
57.3
68.0
53.9
Revenue
32.3
39.2
41.9
66.1
57.3
61.3
41.9
Balance
-11.7
-9.1
-7.5
12.0
0
-6.7
-12.0
Source: Saudi Ministry of Finance; Saudi government announcements; press estimates.
Defense and Security
The United States and Saudi Arabia are not linked by a formal defense treaty; however,
a series of informal agreements, statements by successive U.S. Administrations, and military
deployments have demonstrated a strong U.S. security commitment to Saudi Arabia. (For
statements by previous administrations, see CRS Report 94-78, Saudi Arabia: U.S. Defense
and Security Commitments, February 3, 1994.) Saudi forces acquired experience during the
Gulf war and are undergoing further upgrading through a large-scale program of arms
procurement (see below), both Saudi Arabia and its five smaller Gulf neighbors remain
vulnerable to future external aggression. On one hand, both the Iranian and Iraqi armed
forces suffered major personnel and equipment losses during the 1980-1988 Iran-Iraq war
and Operation Desert Storm, respectively, and neither is in a position to offer an immediate
threat to the Gulf Cooperation Council (GCC). On the other hand, as shown in Table 4, the
combined forces of Saudi Arabia and its GCC allies are outnumbered in important categories
by those of Iraq and Iran, even after the losses sustained by both countries in recent wars.
Congressional Interest in Saudi Arabia
In early 2000, the precipitate rise in international oil prices prompted several legislative
initiatives designed to restrain oil price increases, as mentioned above. On March 22, 2000,
by a vote of 382 to 38 (with one present and 30 abstentions, Roll Call 65), the House passed
H.R. 3822, which requires the President, inter alia, to determine which oil producing nations
are engaged in oil price fixing to the detriment of the U.S. economy, submit reports to
Congress, and “take the necessary steps to begin negotiations to achieve multilateral action
to reduce, suspend, or terminate bilateral assistance and arms exports to major net oil
exporters engaged in oil price fixing as part of a concerted diplomatic campaign with other
major net oil importers...” In the 107th Congress, H.R. 334, the Persian Gulf Security Cost
Sharing Act, introduced on January 31, 2001, would direct the President to seek further
contributions from Saudi Arabia and other Persian Gulf states to defray the costs of U.S.
military deployments in the region.
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Arms Sales
Congress has been particularly sensitive to the argument that enhancing Saudi arms
inventories could result in an incremental increase in overall threats to Israel, although some
Members have supported such sales on the grounds that they help buttress Saudi defense
capabilities in the Gulf and enhance the U.S. job market. Since the mid-1970s, several major
arms sales to Saudi Arabia have been challenged in Congress: F-15 fighter aircraft in 1978;
Airborne Warning and Control System (AWACS) aircraft, advanced tanker aircraft, and
advanced Sidewinder air-to-air missiles in 1981; and a large package of air-to-air,
surface-to-air, and air-to-sea missiles in 1986. All of these sales ultimately were allowed to
proceed, and several larger sales followed before and during the Persian Gulf crisis, without
significant congressional opposition. The Bush Administration’s proposal in September
1992 to sell 72 improved F-15XP fighters to Saudi Arabia met some opposition, but
resolutions to block or postpone the sale never came to a vote.
Arab Boycott
Members of Congress frequently have decried Saudi participation in the Arab boycott
because of its impact on Israel and on U.S. businesses. Some have called for linkage
between U.S. arms sales to Saudi Arabia and Saudi renunciation of the boycott. Part C of
the Foreign Relations Authorization Act for FY1994-1995 (P.L. 103-236, April 30, 1994),
known as the Anti-Economic Discrimination Act, under a provision that took effect on April
30, 1995, bars the sale or lease of U.S. defense articles or services to any country that sends
letters to U.S. firms requesting compliance with, or soliciting information regarding
compliance with, the Arab League primary or secondary boycott of Israel. This provision
permits a presidential waiver on national security grounds; then President Clinton exercised
waiver authority for Saudi Arabia and several other Arab states in Presidential Determination
(PD) 95-20, May 1, 1995, and again in PD 96-23, April 30, 1996. On April 24, 1997, the
President delegated waiver authority under this act to the Secretary of State.
Trade Practices
In the 105th Congress, Section 2801 in Division G of the Consolidated and Emergency
Supplemental Appropriations Act, 1999 (P.L. 105-277, October 21, 1998, 112 Stat. 2681-
845) required reports every 120 days by the Secretary of State, in coordination with the
Secretaries of Defense and Commerce, on actions taken by the three departments to resolve
commercial disputes between U.S. firms and Saudi Arabia as listed in a June 1993 letter
from the Secretaries of Defense and Commerce. In the 106th Congress, this requirement was
retained in Section 209 of the Foreign Relations Authorization Act for FY2000-2001 (H.R.
3427, passed by reference in H.R. 3194, the Consolidated Appropriations Act for FY2000,
P.L. 106-113, November 29, 1999. Currently, this provision appears in Section 201 of H.R.
1646, the Foreign Relations Authorization bill for FY2002-2003, which was passed by the
House on May 16, 2001, by 352 to 73, Roll no. 121.
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Table 4. Selected Middle East Armed Forces
Chem
Main Battle
Combat
Surf. Surf.
Nucl.
Country
Force Size
Warf.
Tanks
Aircraft
Mslsa
Cap.b
Cap
Iran
513,000
1,565
283
S
X
D
Iraqc
424,000
2,200
316
S
X
D
Saudi Arabiad
201,500
910
348
I
–
–
Yemene
54,000
860
71
S
–
–
U. A. E.
65,000
411
101
–
–
–
Oman
43,400
117
40
–
–
–
Kuwait
15,500
293
82
–
–
–
Bahrain
11,000
106
34
–
–
–
Qatar
12,330
35
18
–
–
–
a S = short-range (70-1,000 km); M = medium-range (1,001-3,000 km); I = intermediate-range (3,001-5,000
km).
b D = reportedly under development (now or in the past).
c Figures represent estimates of Iraqi forces and equipment after Operation Desert Storm. Some older tanks are
believed unserviceable. The aircraft total does not include combat aircraft impounded in Iran.
d Force total includes active members of the Saudi Arabian National Guard (estimated at 57,000). Tank total
does not include an estimated 145 French-manufactured AMX-30 tanks in storage.
e Force total includes conscripts (estimated at 25,000). Tank total does not include 50 obsolescent Soviet-
manufactured T-34 tanks. Aircraft total does not include 40 in storage.
Source: The International Institute for Strategic Studies, The Military Balance, 2001-2002.
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