US to make arms deal ‘worth $110bn’ with Saudi Arabia

Middle Eastern ally to purchase ships, munitions and equipment from military

The New York Times reporter Mark Landler details the U.S.'s 10-year, $110 billion weapons deal with the Saudis, and what it means for both sides. Video: New York Times

 

The US has reached a $6 billion (€5.35bn) deal for Saudi Arabia to buy four littoral combat ships made by Lockheed Martin in a package of major arms purchases as president Donald Trump travels to the kingdom, people familiar with the transaction said.

The US and the Saudi ministry of defence “designed and negotiated a package totalling approximately $110 billion,” vice-admiral Joseph Rixey, head of the Pentagon’s defence security co-operation agency, said Friday on a conference call with analysts, according to a White House transcript. “When completed, it will be the largest single arms deal in American history.”

While the package includes deals that were begun under president Barack Obama’s administration – and initial steps toward others that may take years to complete – the final letter of agreement on the littoral combat ships is the highest-profile element.

It includes a better-armed version of the ships, support equipment, munitions and electronic-warfare systems, according to the people, who asked not to be identified in advance of an announcement that may come as early as Saturday morning Washington time. That is when Mr Trump is scheduled to arrive in Riyadh on the first leg of an eight-day trip that will take him across the Middle East and to Europe.

Boeing deal

The US and Saudi Arabia will also sign a letter of agreement for about $500 million in what could become a $3.5 billion deal for as many as 48 CH-47 Chinook helicopters and related equipment built by Boeing. That sale was approved by the state department and congress in December, said an official.

Separately, the state department notified congressional foreign affairs committees on Friday that it was ready to approve export licences – pending a 30-day review by politicians – for the direct commercial sale by Boeing of 3,000 tail kits to convert unguided munitions into GPS-guided bombs.

The sales come as the Trump administration is promising to improve relations with the Saudis that were strained under Obama. For its part, Saudi Arabia has pledged to buy billions of dollars of US military equipment in the next decade and invest about $40 billion from its sovereign wealth fund in American companies.

The littoral ships, designed for shallow coastal waters, are part of a package of agreements on weapons sales that already had been approved in late 2015 by the state department. Congress also approved the sale, but it was not completed under Mr Obama. From 2009-2016, the Obama administration approved $115 billion in potential sales to the Saudis.

Saudi embassy spokesman Nail Al-Jubeir did not return an email and phone call seeking comment. Lockheed spokesman John Torrisi said in an email that “Foreign military sales are government-to-government decisions, and the status of any potential discussions can be best addressed by the US government.”

The defence announcements will also include a letter of agreement completing a sale approved in August 2016 for about 115 M1A2 tanks made by General Dynamics, as well as munitions, and heavy equipment recovery systems, according to two of the sources. A formal agreement is expected for Lockheed to sell more Pac-3 Patriot hit-to-kill missiles, which already have been approved by Congress.

In addition, announcements are expected on intentions to proceed with a number of other deals. They include a nearly $18 billion programme to upgrade Saudi Arabia’s military command-and-control structure and the sale of about 60 UH-60 helicopters from Lockheed for about $5 billion.

Thaad

Also anticipated is an announcement of the Saudi intention to buy Lockheed’s Thaad anti-missile system, which intercepts incoming missiles at higher altitudes than the Patriot. Thaad already has been sold to the United Arab Emirates, the first international customer, and its deployment by the US to South Korea has created tension with China.

The contracts for all the transactions in the package will be managed by the U.S. government with the companies, which is standard under Foreign Military Sales contracts.

Parts of the package may draw congressional criticism. A resolution to block the tank sale was introduced in September by several US senators, including Republican Rand Paul and Democrat Chris Murphy. They cited allegations that Saudi aircraft were killing civilians in Yemen with US-supplied munitions in attacks on Iranian-backed Houthi rebels. That resolution was defeated in September 2016 on a 71-27 vote.

Bloomberg