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20 Feb, 2019 20:03

Think of the billions! UK’s Hunt urges Germany to drop Saudi arms sales ban

Think of the billions! UK’s Hunt urges Germany to drop Saudi arms sales ban

UK Foreign Secretary Jeremy Hunt has pleaded with his German counterpart to drop Berlin’s ban on weapons exports to Saudi Arabia, fearing it will damage the bottom line of UK and European arms manufacturers.

In a private letter to German Foreign Minister Heiko Maas ahead of a trip to Berlin Wednesday, Hunt said he was “very concerned about the impact” Germany’s decision to cancel arms sales to Saudi Arabia would have on both the defense industry as well as its ability to fulfill NATO commitments. The letter was seen by the German weekly Der Spiegel.

He added that the decision would cost German arms companies to the tune of €2.3 billion by 2026.

Berlin announced in November that it would hold off on providing further arms export licenses to the Gulf kingdom, following the killing of journalist Jamal Khashoggi in the Saudi Istanbul consulate the month before. Several other Western governments – including the US, Canada, and Spain – condemned the killing but said arms sales to Riyadh would continue.

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Amounting to 2 percent of Saudi Arabia’s defense imports, Germany’s slice of the Saudi arms pie pales in comparison to US, UK and French share. However, deep European integration over supply chains in certain weapons programs complicates matters for other suppliers, as many use German-made components that are now covered by Berlin’s ban.

One purchase currently stalled is the sale of Meteor air-to-air missiles by consortium MBDA. A joint venture by the UK’s BAE Systems, Italy’s Leonardo and Airbus, both the Meteor’s propulsion system and warheads are manufactured in Germany.

For the UK, which supplies almost a quarter of all arms exports to Saudi Arabia, the ban could have a much deeper and expensive impact. Hunt warned Maas that several multi-billion contracts inked between London and Riyadh – including deals for Eurofighter Typhoon and Tornado fighter jets, may not be fulfilled due to the ban.

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Germany’s arms industry is already looking at ways to overturn the ban, or at least get a payoff for the inconvenience it has caused. In January, it was reported that Rheinmetall AG threatened to sue the German government for compensation for any existing arms deals that were affected by the ban.

Praising Hunt’s letter was Germany’s defense industry association BDSV, who said that the ban was “costing it the ability to partner with its closest European allies.”

The UK Campaign Against the Arms Trade (CAAT) blasted the letter as “appalling,” however, adding that the UK should follow rather than undermine Germany’s example in halting arms sales to Riyadh.

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