Leonardo expands UAE naval role; Türkiye-Saudi-Pakistan pact advances; U.S. proposes UAE and Kuwait arms packages
Gulf defence demand is producing both near-term procurement and deeper industrial integration, from Leonardo’s UAE naval work and proposed national combat-management system to U.S. weapons proposals and the Türkiye-Saudi-Pakistan pact. The key test is execution—whether ratification, contracts and local design and sustainment roles turn announced cooperation into durable capability—while shareholder scrutiny and ACWA Power’s U.S. venture show the wider governance and capital stakes of Gulf expansion.
Defence and security
Leonardo expands its UAE naval integration role. Leonardo has signed an agreement with Abu Dhabi Ship Building (ADSB) to support combat-system integration for nearly 30 UAE Navy ships. The work builds on Leonardo’s decades-long supply relationship with the UAE, which includes naval guns, combat-management systems, radars, fire-control systems, missile electronics and radios for more than 40 vessels. Leonardo is also pursuing a separate partnership with Emirati industry to develop a national Combat Management System for new and legacy ships. The ADSB agreement creates an immediate integration opportunity; the proposed national system would determine whether UAE industry gains a deeper role in future design and sustainment.
SOFEX 2026 highlights Jordanian unmanned and rocket development. Jordan’s Design and Development Bureau displayed 10 drone and uncrewed platforms, including low-cost offensive drones made using 3D-printing technology. Students also presented “Just One,” described as the first rocket built in Jordan and designed to reach 1,550 metres. The exhibition points to a defence-development model combining institutional research, accessible manufacturing and education pipelines. For Gulf companies and investors, the commercial question is whether these systems advance from exhibition displays into testing, procurement, production or partnerships; the report provides no evidence yet of contracts, exports or operational deployment.
Türkiye-Saudi-Pakistan defence pact moves toward ratification. Türkiye’s parliament Foreign Affairs Committee approved the ratification bill for the Mecca Joint Defence Agreement on 27 October. The pact, signed by Türkiye, Saudi Arabia and Pakistan in August, provides for mutual-defence commitments, military coordination and defence-industrial cooperation, but committee approval is not final ratification or authority to deploy Turkish forces abroad. Its progress comes as the parties prepare capabilities for possible deployment in Saudi Arabia amid Yemen fighting. The next market and policy indicators are final ratification, the scope of deployment authority and whether the agreement produces concrete industrial programmes.
Washington advances UAE and Kuwait weapons packages. Reported proposals include up to $1.041 billion in APKWS II guidance sections and related equipment for the UAE, and a $400 million Patriot repair and support package for Kuwait. The packages remain subject to congressional review, negotiations and final contracts. Their composition highlights Gulf demand for air defence, precision weapons, counter-drone capabilities and sustainment—not only new headline platforms. If completed, the sales would also deepen recurring U.S. supplier relationships through logistics, maintenance and technical support.
Technology, infrastructure and capital
Microsoft’s Gulf data-centre expansion faces shareholder scrutiny. ADL and JLens are urging Microsoft shareholders to reject two resolutions ahead of the company’s 8 December 2026 annual meeting. Proposal 5 would seek a report on safeguards against human-rights or international humanitarian-law violations involving misuse of Microsoft’s AI and cloud services. Proposal 6 would address the implications and mitigation strategies for cloud data centres in countries the proponents identify as having significant human-rights concerns, specifically naming new capacity in Saudi Arabia and the UAE. The proposals do not establish any change to those projects, but a stronger vote could pressure Microsoft to expand its disclosures and due-diligence practices.
ECB succession puts European-Gulf investment conditions on watch. European authorities have begun the process of replacing the European Central Bank president, whose term ends on 7 February 2027. The European Council will appoint the successor after consulting the European Parliament and the ECB’s Governing Council. For GCC investors and companies with European exposure, the process is a macroeconomic watchpoint: confidence in the ECB’s independence would support continuity, while a contested transition could affect euro movements, capital flows and cross-border investment decisions. This is a financial-conditions development rather than evidence of a new Gulf defence or industrial programme.
ACWA Power enters the U.S. power market through a $4 billion joint venture. Saudi Arabia’s ACWA Power and Washington-based EIG are forming Plenum Power, with EIG holding 51% and ACWA contributing development expertise. The venture will target U.S. power-plant construction and acquisitions, supported by demand from data centres and electrification. It is ACWA’s first U.S. expansion after projects in 16 countries. The transaction shows a Saudi-backed company using a U.S. partnership to combine local development capabilities with capital and market access; the next indicators are specific acquisitions and project announcements.