DESPITE progress toward Mideast peace, the region has become embattled by fierce competition among the world's leading arms suppliers -- the US, Germany, Russia, France, Britain, and China.
The launch last week of a sophisticated spy satellite was the latest effort in Israel's quest to retain a strategic advantage over its heavily militarized Arab neighbors.
Ofek-3, part of an ongoing Israeli satellite program using components from the United States, will soon beam back photographs of neighboring Arab countries that will make it possible to read automobile license plates in Baghdad.
War for weapons
The headlong contest to acquire more modern and effective weapons systems -- once driven mainly by the prospect of war with Israel -- is being fueled now by tensions among Muslim-run states, security concerns triggered by the Gulf war and, ironically, by the side effects of rewarding Arab states that sign peace accords with Israel with arms.
Last year, some 26 percent of the world's arms sales were concluded with Middle Eastern countries, particularly Saudi Arabia and the other Gulf States -- United Arab Emirates, Oman, Qatar, Bahrain, and Kuwait. The US was by far the largest arms supplier to the region.
In 1993, the US sealed 72.6 percent of all new arms transfers of weapons to poorer countries. The bulk of these transfers were to the Middle East, which bucked the global trend of falling arms sales since the end of the cold war.
''There are such huge forces driving the arms race that it is difficult to pass moral judgment on the countries in the Middle East that are buying the weapons,'' says Zeev Eytan, co-author of the Middle East Military Balance, published by Tel Aviv University's Jaffee Center for Strategic Studies.
''I have become accustomed to it. It is like a bad way of life,'' Mr. Eytan says, pointing out that the arms race is being driven by major suppliers that are trying to catch up with the US.
The US emerged as the world's greatest arms supplier after the collapse of the Soviet Union and a global shift away from ideology as a determinant of international relations. In February, the US adopted an arms--sales policy that puts commercial considerations first and is free of the ideological restraint associated with the cold war period.
So, when the US appeals to Russia to halt its sale of sophisticated weapons and a military reactor to Iran, it cuts little ice with Moscow.
''We have no moral standing to tell the Russians and the Chinese not to sell arms to rogue states because we out-competed them in sales to the nonrogue states of the Middle East,'' says Lawrence Korb, a defense specialist at the Brookings Institution in Washington, and a former assistant secretary of defense in the Reagan administration.
The seemingly insatiable Middle Eastern appetite for sophisticated weaponry and defense systems was highlighted at an arms bazaar extravaganza held in mid-March in the United Arab Emirates capital of Abu Dhabi, fast becoming a compulsory venue for international arms manufacturers.
''The Abu Dhabi arms bazaar has assumed tremendous importance among arms suppliers,'' says Joanna Spear, research fellow at Harvard's Center for Science and International Affairs. ''It seems to be the place to take your best and latest weaponry.''
Attended by some 600 companies from nearly 50 nations, the bazaar exhibited a dazzling array of military technology including a wide selection of naval gunships, attack helicopters, ground-to-air and sea-to-air missiles, and weapons systems.
Arab officials from more than a dozen countries sat transfixed in a large auditorium as demonstrations of ground-to-air missiles and other weaponry flashed by on triple audio-visual units accompanied by racy sales commentaries.
The organizer of the conference, the UAE's Brig. Gen. Sultan Suwaidi, predicted that Arab states would purchase more than $60 billion of arms and hi-tech military equipment over the next five years.
In the three-year period between 1991 and 1993, four of the world's top arms-importing nations were from the Middle East -- Saudi Arabia ($18.6 billion), Iran ($3.6 billion), Egypt ($2.7 billion), and Israel ($2.2 billion), according to a report by the US Arms Control and Disarmament Agency.
''There is a growing desire by all states in the Middle East to increase the sophistication of their weaponry, and the only restraint on acquisition will be their ability to pay,'' says Steven Goose, director of the Washington-based Human Rights Watch Arms Project.
The US dual containment policy against both Iran and Iraq has limited sales to those two countries, but has sparked fierce competition between countries like France, Germany, Russia, and China to be in line for major contracts when the US embargoes are lifted.
Russia is already involved in a diplomatic row over arms sales to Iran and its recent sale of a nuclear reactor to that country.
''The UN sanctions against Iraq will not continue forever,'' Eytan says. ''Once they are gone, Iraq will assert its ambition to play a major role in the Arab world, and it will turn to Russia and France to acquire modern weapons.''
In 1994, US arms exports accounted for about 40 percent of global sales of conventional weapons, according to a report released earlier this month by the Monterey Institute of International Studies in California.
Turkey and Greece topped the list of arms importers in 1994 with Saudi Arabia in third place. The sales to Turkey and Greece were accounted for by the US and Germany dumping large quantities of used weapons and hardware on these countries.
The row between Israel and Egypt over Israel's refusal to sign the Nuclear Non-Proliferation Treaty is another factor fueling the arms race. So is the future prospect of Iran and Iraq acquiring nuclear weapons despite the fact that they are NPT signatories.
The 1979 peace accord between Egypt and Israel was secured with an indefinite annual injection of US military aid to both countries valued at almost $3 billion annually.
Jordan, too, is in line to receive US weapons as part of its reward for concluding a peace accord with Israel in October last year.
Now diplomats and analysts predict that a peace accord between Israel and Syria, with its quantitatively superior military might, would further escalate the Middle East arms race.
One of the demands Israel is making for withdrawing from the Golan Heights is a reduction in Syria's military arsenal.
''If Israel gives up the Golan in exchange for more arms, then Syria will want more arms as well,'' says Mr. Korb, the former US assistant defense secretary.
The scrapping last year of the European Union's arms embargo against Syria has opened the way for the French and other EU countries to reenter the Syrian market.
Moscow's drive for sales
Another factor is Russia, which is eager to resume arms sales to Iran and Iraq, the former Soviet Union's main Middle Eastern allies.
Strapped for cash, Moscow has been at the forefront of countries lobbying for an end to UN sanctions imposed on Iraq at the time of the Gulf war.
Efforts by the major arms supplying nations to restrict the sale of arms to the Middle East following the Gulf war collapsed when the Chinese withdrew from an arrangement whereby all sales to the Middle East had to be screened by the UN Security Council.
Now the US is seeking to regulate the global sales of conventional weapons by creating a successor to the Coordinating Committee for Multilateral Export Controls, which limited the flow of hi-tech weapons to the Warsaw Pact countries during the cold war.
But the creation of the new body, which would regulate the flow of weapons to unstable areas, is being hampered by a row over Russia's sale of weapons and nuclear technology to Iran.