AIRSHOW - Arms race dominates Dubai air show

By John Irish and Tamara Walid

DUBAI (Reuters) - Middle East tension is driving demand for military hardware at the Dubai Air Show which opened on Sunday, but recession means fewer orders for civilian jets.

Ethiopian Airlines offered a glimmer of hope on the civil side, with a $2.9 billion order for 12 Airbus A350s.

The carrier had drafted a request for 12 A350-900s in July and made its expansion plans public at Sunday's announcement.

The confirmation of the deal is a boost for Airbus as it pushes orders for the future mid-sized jet above the 500 mark.

The European plane maker could bag up to $3.5 billion in airline orders early in the four-day show, including the first for an 840-seat version of its A380 superjumbo, the world's biggest passenger plane.

But it was the Gulf region's role as the world's busiest arms market that dominated day one of the largest Middle Eastern showcase for aviation.

"With more threats and continued tensions, you will have continued demand for new systems and new capabilities, and that is why we have seen ongoing interest in upgrading and renewing fighter fleets," Riad Kahwaji, chief executive of the Institute for Near East and Gulf Military Analysis, told Reuters.

"So long as tension is there, and the situation with Iran is not solved, and there is the threat of terrorism and so forth, I think there will be an ongoing arms race," he added.