New Geometry of Defense Growth
Q1 – It is clained that global defense spending is entering a new phase. What are the structural shifts behind this rise?
Ali Bogac Cicioglu: Global defense spending has become truly multipolar. US and its allies once represented over half of global outlays, but that dominance is fading. In the last five-year period, Europe increased its military budgets by nearly 47%, East Asia by over 20%, and the Middle East has returned to high growth territory. What we’re witnessing is not a temporary spike but a structural realignment.
Europe is rearming on an industrial scale; East Asia is sustaining the world’s longest upward curve, and the Middle East is moving toward capability sovereignty. SIPRI’s annual data shows headlines, but when analyzed over five-year blocks, it reveals long-term intent — nations investing not just in defense, but in self-reliance and technological independence.
Q2 – How is this quantitative expansion translating into industrial change—or is it?
Ali Bogac Cicioglu: That’s the paradox. The numbers suggest expansion, but the structure suggests consolidation. Between 2019 and 2024, total revenues among the world’s 100 largest defense firms rose by more than 25%, yet the same incumbents captured most of it. The top ten companies still generate over half of all defense revenue.
Europe’s rebound is built on ammunition and refurbishment programs, not on design authority. In contrast, nations such as Turkey, India, Poland, Saudi Arabia, and the UAE are turning their budgets into national R&D ecosystems. They are building IP ownership, not just importing capability. This is where the real transformation lies — in the translation of budget into technology sovereignty.
Q3 – Just to connect these developments to macro-trends, do you think the economic theory of “creative destruction” can be applied to defense?
Ali Bogac Cicioglu: For decades, defense market seemed to be independent from macro-treds and more connected with strategic imperatives — stable programs, long contracts, predictable primes. But beneath that, a Schumpeterian rhythm of renewal was always active. Every major leap — radar, stealth, unmanned systems — replaced an older paradigm.
Today, that cycle is accelerating again. Philippe Aghion’s work on “managed creative destruction” explains why: innovation needs competition, but also stability. Defense ministries are now fostering contestable architectures where smaller firms can innovate within legacy platforms. The sector is becoming evolutionary — reconfiguring itself rather than waiting for revolutions.
Q4 – What new dynamics are redefining how innovation happens in the defense world?
Ali Bogac Cicioglu: Innovation is shifting from hardware accumulation to algorithmic agility. What used to be measured in tonnage is now measured in tempo. Technologies like EO/IR sensing, AI-assisted detection, and networked command systems are collapsing design, validation, and deployment cycles into one loop.
Capital flows are also changing the game. Sovereign funds and defense-focused ETFs are pouring money into dual-use innovation. Governments act less like buyers and more like strategic investors. The financial system has become an extension of defense strategy — industrial policy and deterrence are converging.
Q5 – You’ve mentioned the “fragmentation” of globalization. What does this look like for defense cooperation?
Ali Bogac Cicioglu: We’re seeing three distinct ecosystems emerge. The Atlantic Bloc — the U.S., UK, and Europe — is modernizing legacy strength through digitalization but remains governance-heavy. The Indo-Pacific Region — China, Japan, Korea, India — fuses industrial policy and strategy at scale. And then we have the Emerging Powerhouses: the UAE, Saudi Arabia, Turkey, Poland, and others building sovereign ecosystems with state-backed capital.
This fragmentation increases demand for trusted co-developers — companies that can transfer know-how without creating dependency. That’s exactly where SHOCK EOS operates: as a design house that enables partners to build, own, and industrialize their own electro-optic systems, within export-compliant frameworks.
Q6 – Given these shifts, where do you see the greatest opportunities for innovation?
Ali Bogac Cicioglu: The next wave lies in convergence: EO/IR sensing fused with AI and networked autonomy. As operations become data-centric, the competitive edge will depend on how fast a nation or OEM can close the loop between detection, decision, and action.
Dual-use fields such as robotics, photonics, and software-defined control will fuel this growth. Smaller firms are faster in iteration; large OEMs need them to stay agile. The opportunity is not just in invention but in integration — in how quickly a concept becomes a capability.
Q7 – From a business-development standpoint, how is SHOCK EOS positioning itself within this changing geometry?
Ali Bogac Cicioglu: SHOCK EOS was built for this new geometry. We operate as an independent electro-optic design house with R&D in South Africa and headquarters in Abu Dhabi. Our model is based on co-development — helping OEMs and end users develop capabilities they own.
We focus on modular architectures: gimbals, laser products and integrated electro-optical sensors that can be adapted across land, air, and maritime domains. Our value is agility — we bridge the gap between concept and production while protecting our partners’ intellectual property. In a world demanding sovereignty and speed, that’s what makes SHOCK distinct.
Q8 – Finally, what does the future of the defense industry look like beyond 2030?
Ali Bogac Cicioglu: Defense will be defined less by scale and more by speed. We’re moving from industrial defense to adaptive defense — where innovation velocity equals deterrence. Nations that innovate faster, integrate smarter, and manufacture flexibly will define the balance of power.
At SHOCK, we’re aligning our growth strategy to that reality: developing modular systems, accelerating technology transfer, and ensuring partners can sustain innovation without dependence. The future belongs to those who own their innovation cycles — and that’s the space we intend to lead.
About the Interviewee
Ali Bogaç Cicioğlu is the Business Development Director at SHOCK EOS, an Abu Dhabi–based electro-optic engineering company with a design house in South Africa. SHOCK specializes in modular, high-performance imaging and targeting systems developed through co-engineering with OEMs and defense agencies.
Ali Bogaç Cicioğlu is a business development professional with a proven track record in business strategy, market development, and capture management. His areas of interest include multinational projects, coopetition, strategic alliances, and joint ventures.
